Can Money Bring You Happiness?
“Money can’t buy you happiness.”
Does this sound familiar?
Too many of us have heard this phrase again and again. While it’s true that we don’t get happiness directly from simply having money, it’s also true that money can be used as a tool to create happiness, joy, and fulfillment in our lives. I’m not saying that purchasing an unnecessarily large boat, or always spending too much when you go to the department store is going to make you happy. However, when we spend in a way that’s meaningful to us, it can be a source of happiness. Spending money can leave you feeling more fulfilled when it's spent in a way that aligns with your values.
What Do You Value?
Your first step is to define what you value, and how that impacts your family’s budget. Taking a personal values assessment can be useful, but you can also just take the time to sit down with a pen and paper and jot down the things in life you value most. Make sure you’re being honest with yourself and not just writing down values because you feel that you “should” prioritize them in your life. If you’re struggling with this exercise, you might try asking yourself a few questions:
How do I spend my time when I have no other responsibilities to take care of?
What do I value in my relationships?
When do I feel happiest or the most content?
How do my partner or spouse and I make decisions? What different things impact our lifestyle?
The list of values you might come up with is long, but a few that I consistently see among my clients are:
Family
Friends
Adventure/Travel
Experiences
Education
Faith
Security
When you start to build a budget, you should prioritize the things in life that you value most to set goals and use your wealth as a tool for personal growth and fulfillment.
Using Money as a Tool for Happiness
Setting goals that line up with your values isn’t always easy. We have a lot of financial responsibilities that weigh on us, and they can get in the way of us spending our money on what we care most about. Creating a budget that reconstructs your spending from the ground up can be helpful. To start, write down all of your current expenses - big and small. Are you grabbing a $5 latte on your way to work every day? Are you going on a weekly date night? Are you contributing a specific amount to your cash savings, retirement savings accounts, or a 529 plan for your kids each month? Are you donating money to your church or to a charitable organization whose mission you believe in annually? Knowing where your money is going is the first step in redirecting it toward things that will actually make you happy.
Once your expenses are written down, evaluate whether or not they actively contribute to your happiness each day. Are they connected to your values? Are you overspending on things that don’t really make you happy? A few common culprits are:
An expensive mortgage payment when you’d be just as content with a smaller, more affordable living space
An excessive amount of money spent on your morning latte or on lunches out while you’re at work when “eating out” money should be reserved for meals spent with family and friends.
Payments toward your debt.
If you can revise your current budget to decrease what you spending on things that don’t make you happy and funnel those funds toward expenses that match your values, you’ll be notably more fulfilled. This might mean making big moves like selling your home to downsize or paying down your debt more quickly to free up cash flow and start using the funds for something meaningful. However, it might only require small changes such as packing your lunch at work to contribute an extra hundred dollars a month to your child’s 529 plan.
It’s Your Wealth - Use It How You Want
Too often we get caught in a cycle of setting financial goals or making spending decisions, that don’t actually match what we value or what we want out of our lives. The sooner we’re able to release the need to do what we “should” do, or spend our money in a way that matches what our friends and families are doing with their money, we’re able to find satisfaction with our wealth. Ultimately, money can buy you happiness - it’s just a matter of spending it in a way that makes you happy.
Avoid the Quick Fix
One trap we often fall into is spending our money on “quick fixes.” The morning latte is a small way to treat ourselves when what we truly need is to devote funds each month to self-care, a gym membership, or time with our loved ones. We need to be willing to look past the instant gratification spending traps to focus on the ways we can spend our money that will bring long-lasting fulfilment and happiness. This isn’t something that’s easy to do on your own. Talking to a financial planner can help. If you’re interested in receiving help to set up a budget, an investing strategy, or a financial plan that guides you to spend in a way that lines up with your values, contact me today!