We Always Want More

It feels like almost everyone I talk to isn’t happy about our current economy. The price of everything seems to be going up and no one knows how anyone can afford anything. In a recent survey from Empower, around 80% of Americans listed their biggest financial stressor as “the rising costs of goods and services” and “inflation.”

Yet, these concerns about higher prices have not stopped us from spending money.

The Sunday after Thanksgiving was the busiest day ever at airports in the U.S. And Black Friday shoppers set an online spending record of $9.8 billion which led to online revenue for companies to be up 7.5% from last year.

Of course, this is holiday travel and spending, but this spending trend has been going on for some time now.

Take a look at the inflation-adjusted spending across the country:

A lot of people are happy to complain about the state of the economy and especially how expensive everything is, but people also just keep on paying those higher prices no matter the cost. We love to consume in this country and that’s a difficult habit to break.

I do think this speaks to our constant desire for more. Most of us remain convinced that if we could just buy that one thing or increase our income just a little bit more our lives would improve drastically.

The Wall Street Journal shared some research on how much money people felt they needed to make to be happy:

“In the survey, most people said it would take a pretty significant pay bump to deliver contentment. The respondents, who had a median salary of $65,000 a year, said a median of $95,000 would make them happy and less stressed. The highest earners, with a median income of $250,000, gave a median response of $350,000.”

From the survey, employers are planning on an average pay increase of 3.9% in 2024 but Americans said they would need almost a 50% pay raise to feel happy.

Another study found that people who randomly received $10,000 (wouldn’t that be nice) tended to get a boost of happiness that only lasted about six months.

The following chart illustrates this point:

Regardless of how much you make, you’ll always want more.

From a macroeconomic point of view, this insatiable appetite for more is actually a good thing.

If you’ve ever worked for a company you’ll know that the primary objective of pretty much any for-profit organization is to grow, grow, grow, and grow some more. Every quarter you set new and higher sales goals. Each year you figure out how you can reach more people and increase revenue. Stagnant revenue is not acceptable. I’m sure most of us have heard the common saying, “If you’re not growing, you’re dying.”

This is why it’s beneficial to invest your money and buy stocks. Companies are continuously striving to improve, innovate, and produce more profits. And we keep spending more and more money on what these businesses have to offer.

The fact that we always want more is a bullish long-term outlook for humanity and the economy.

However, while this mentality propels us forward as a human race, it can be devastating on an individual level.

On one hand, it’s a good thing to be driven to improve your place in life but those same attributes can drive you mad if you never feel satisfied with your accomplishments. Unfortunately, there will always be someone more wealthy than you are and there will always be more money to be made.

This is why one of the most important financial skills is getting the proverbial goalpost to stop moving. It’s also one of the hardest. In a game that can’t be won, you have to define what winning means for you.
I love this analogy from Morgan Housel:

“Money buys happiness in the same way drugs bring pleasure: Incredible if done right, dangerous if used to mask a weakness, and disastrous when no amount is ever enough.”

Finding how much is “enough” for you isn’t easy and will likely change over time. It’s a hard question to answer, but I think simply asking yourself the question is a good place to start.

Thanks for reading!