Inequality much worse than most think

[lektrode]

Re: money vs happiness

google "hedonic adaptation."
what the research shows is that income below the threshold required for decent food, clothing and shelter produces misery.
above that threshold, money doesn't seem to buy a lot, especially when spent on THINGS. in general people are much more rewarded when they spend their money on experiences, which are memorable, than on things, to which they adapt very rapidly.
then there's that famous story kurt vonnegut told about joseph heller....

yep, +1
since even a J6P like me figgerd out a ways back that NOT EVEN UNCLE WARREN (nor uncles bill nor even larry)
gets to have MORE than a nice sunset, with some jazz playing in the background, a couple/3 cocktails and a well prepared meal to wash it all down.

and at some places, even THEY have to wait in liftlines.

[santafe2]

Re: money vs happiness

This picture fits very well with some of the results I have heard about happiness research. One theme is that people get more satisfaction spending their money on experiences vs purchasing physical objects. So getting to drive a Lamborghini for 10 laps is probably much more "bang for the buck" compared to actually purchasing one. The thrill of most objects wears off pretty quickly.

What's interesting about studies of wealth and happiness is that in my experience wealthy people do think that they are happier by having lots of money. I've wondered if this contradiction has to do with the innate happiness levels of those who seek to gain lots of wealth vs those that are happy with what they have. Or if it's just a perception bias that rich people think that money is making them happier but it really isn't.

And the great thing about experiences is that you don't have to be rich to have them and in this case you won't have the annoyance of a $3-4,000 oil change or driving 65 mph in a car meant to be driven closer to 150. Planning experiences with family and close friends is the essence of happiness. It can be nothing more than a long weekend camping trip and a new biking or hiking trail. For us it's often any place without cell service.

[EJ]

Re: money vs happiness

This picture fits very well with some of the results I have heard about happiness research. One theme is that people get more satisfaction spending their money on experiences vs purchasing physical objects. So getting to drive a Lamborghini for 10 laps is probably much more "bang for the buck" compared to actually purchasing one. The thrill of most objects wears off pretty quickly.

What's interesting about studies of wealth and happiness is that in my experience wealthy people do think that they are happier by having lots of money. I've wondered if this contradiction has to do with the innate happiness levels of those who seek to gain lots of wealth vs those that are happy with what they have. Or if it's just a perception bias that rich people think that money is making them happier but it really isn't.

I think there is a very important concept of wealth that we as a community can encourage others to develop and that is Enough.

To my thinking since a very young age Enough is Personal Economic Liberty, that is, to have enough assets to never have to do anything that you do not want to do -- for ethical, health, or other reasons -- for income and still care for yourself, family, community, and others you love.

Other definitions?

[lektrode]

Re: money vs happiness

I think there is a very important concept of wealth that we as a community can encourage others to develop and that is Enough.

To my thinking since a very young age Enough is Personal Economic Liberty, that is, to have enough assets to never have to do anything that you do not want to do -- for ethical, health, or other reasons -- for income and still care for yourself, family, community, and others you love.

Other definitions?

see mine above, Mr J...
a good sunset, couple cold ones and a good meal - that and settin out on ones front porch/back deck or lanai, while ones at it, if i might add.

A lot of peoples happiness hinges on how many new products/clothes they can buy.

I am convinced a majority of people lack a thirst for knowledge. Thats what makes me happy, simply learning new facts/ideas.

The intellect thirsts only to satiate its fascination.

ayuh, +1
thats a roger, P.
and The Practical Application of em

[Thailandnotes]

Re: money vs happiness

The thrill of most objects wears off pretty quickly.

Just finished building this. First bread.

[lektrode]

Re: money vs happiness

Just finished building this. First bread.

whoooooo..... that _does_ look tasty TN!!!

NICE job.

[Forrest]

Re: money vs happiness

I think there is a very important concept of wealth that we as a community can encourage others to develop and that is Enough.

To my thinking since a very young age Enough is Personal Economic Liberty, that is, to have enough assets to never have to do anything that you do not want to do -- for ethical, health, or other reasons -- for income and still care for yourself, family, community, and others you love.

Other definitions?

Personal Economic Liberty in that sense is more than liberty, for that amount of liberty...to have that much command of your life, to do as you like, when you like; along with the power and money to live your life as you choose while still caring for family, and helping your community...that is much more than enough...that is the definition of Independent Wealth. You then stand in control of your life, dependent on only your will and desire. You speak of an autonomy, a level of wealth that buys sufficient power to guard you from the inconveniences of living, to buy what you need, and what what you want, and more.

Knowing what would make you comfortable, and a burden on no one else, and reaching that level of comfort should be the realistic goal. I would like to have more than I have, but all that I might want is irrelevant to what I need to be comfortable. Comfort is always having enough for yourself, to pay the bills and the taxes, to keep the car running, and to take care of your family, and those you love, and still have a bit to spare for others; to have time for the work that you enjoy, and time for the people in your life, and to have the occasional luxury that puts the spice and extra pleasure in life.

Between my Comfort and your Personal Economic Liberty are many different levels of income and asset acquisition. Comfort is a level of choice in living that can be easily gained with an average income, if well managed, by not seeking to have all that everyone can have, but only those things that you really need, but having them in abundance, with quality, and sufficient leisure time that you need to enjoy them in. Comfort does not allow for the complete control of your life as Personal Economic Liberty does as that is a state of wealth and power beyond the ability of the average community member.

Young people must first be taught what it is in life that they need to be living comfortably, and then what they long for above and beyond that can be the driving force to take them into the state of being Independently Wealthy if that is their desire.

The problem always will be in showing people how to work towards that true wealth if it is within their ability to strive for, but they must also be informed of the real cost of acquiring that wealth. Not everyone is willing to pay the price of acquiring the level of wealth that is needed to acquire Personal Economic Liberty, and not everyone that is willing to pay the price has the ability.

[leegs]

Re: money vs happiness

Personal Economic Liberty in that sense is more than liberty, for that amount of liberty...to have that much command of your life, to do as you like, when you like; along with the power and money to live your life as you choose while still caring for family, and helping your community...that is much more than enough...that is the definition of Independent Wealth. You then stand in control of your life, dependent on only your will and desire. You speak of an autonomy, a level of wealth that buys sufficient power to guard you from the inconveniences of living, to buy what you need, and what what you want, and more.

Knowing what would make you comfortable, and a burden on no one else, and reaching that level of comfort should be the realistic goal. I would like to have more than I have, but all that I might want is irrelevant to what I need to be comfortable. Comfort is always having enough for yourself, to pay the bills and the taxes, to keep the car running, and to take care of your family, and those you love, and still have a bit to spare for others; to have time for the work that you enjoy, and time for the people in your life, and to have the occasional luxury that puts the spice and extra pleasure in life.

Between my Comfort and your Personal Economic Liberty are many different levels of income and asset acquisition. Comfort is a level of choice in living that can be easily gained with an average income, if well managed, by not seeking to have all that everyone can have, but only those things that you really need, but having them in abundance, with quality, and sufficient leisure time that you need to enjoy them in. Comfort does not allow for the complete control of your life as Personal Economic Liberty does as that is a state of wealth and power beyond the ability of the average community member.

Young people must first be taught what it is in life that they need to be living comfortably, and then what they long for above and beyond that can be the driving force to take them into the state of being Independently Wealthy if that is their desire.

The problem always will be in showing people how to work towards that true wealth if it is within their ability to strive for, but they must also be informed of the real cost of acquiring that wealth. Not everyone is willing to pay the price of acquiring the level of wealth that is needed to acquire Personal Economic Liberty, and not everyone that is willing to pay the price has the ability.

Very well stated!

I was just writing a response along the same lines, but gave up as I wasn't able to concisely articulate my point. I would add that Comfort is not only a function of income vs expenses, it does imply at least some choice in 'doing things you don't want to do'. For me Comfort did not include working quite hard in an unsatisfying but good-paying job for a large organization. Comfort does include working in my piddly small business, for half the money I made before, but doing satisfying (if often hard and dirty) work and having free time for family, hobbies, self-actualization, etc.

[Forrest]

Re: money vs happiness

Very well stated!

I was just writing a response along the same lines, but gave up as I wasn't able to concisely articulate my point. I would add that Comfort is not only a function of income vs expenses, it does imply at least some choice in 'doing things you don't want to do'. For me Comfort did not include working quite hard in an unsatisfying but good-paying job for a large organization. Comfort does include working in my piddly small business, for half the money I made before, but doing satisfying (if often hard and dirty) work and having free time for family, hobbies, self-actualization, etc.

Thanks, Leegs... "Comfort does include working in my piddly small business, for half the money I made before, but doing satisfying (if often hard and dirty) work and having free time for family, hobbies, self-actualization, etc."

My thoughts exactly...living in my small, but easily heatable/coolable house, on my five acres where I can raise my own veggies, and not have to spend so much money at the market...it's sooo comfortable to not live as I was trained to do, and expected to do by my family/community/society...ever so comfortable to not do ANYTHING I ever thought I would be doing, and only wish I had found this all out 40 years ago, and set my goals accordingly. Wouldn't have wasted so much time and energy on foolishness, but would have designed my life around living the life I really wanted.

[akt]

Re: money vs happiness

I think there is a very important concept of wealth that we as a community can encourage others to develop and that is Enough.

To my thinking since a very young age Enough is Personal Economic Liberty, that is, to have enough assets to never have to do anything that you do not want to do -- for ethical, health, or other reasons -- for income and still care for yourself, family, community, and others you love.

Other definitions?

There are three levels of success in my book.
The highest / first level = Ability to give happiness to people you come in contact with. That is why people with humor, singing skills, social adaptability as in such high demand.

The second level = Atleast be happy yourself always. Meditate and be content.

The third level = Freedom. Ranges between comfort as Mr. Forrest Says and personal economic liberty of Mr. EJ level.

[DSpencer]

Re: money vs happiness

Just finished building this. First bread.

Very nice! Does it also make pizzas? Definitely an "object" that will likely bring joy for some time. Of course, I would say that's in part because you get to relive the satisfaction of building it each time you use it.

[jk]

Re: money vs happiness

then there's that famous story kurt vonnegut told about joseph heller....

kurt vonnegut and joseph heller were at a party hosted by some billionaire. vonnegut asked heller how he felt, knowing that the host made in one day more than heller made in total from catch 22, his best seller. heller replied that it was ok, because he had something the host would never have. what was that? asked vonnegut. "enough," said heller.

[lakedaemonian]

Re: money vs happiness

Personal Economic Liberty in that sense is more than liberty, for that amount of liberty...to have that much command of your life, to do as you like, when you like; along with the power and money to live your life as you choose while still caring for family, and helping your community...that is much more than enough...that is the definition of Independent Wealth. You then stand in control of your life, dependent on only your will and desire. You speak of an autonomy, a level of wealth that buys sufficient power to guard you from the inconveniences of living, to buy what you need, and what what you want, and more.

Knowing what would make you comfortable, and a burden on no one else, and reaching that level of comfort should be the realistic goal. I would like to have more than I have, but all that I might want is irrelevant to what I need to be comfortable. Comfort is always having enough for yourself, to pay the bills and the taxes, to keep the car running, and to take care of your family, and those you love, and still have a bit to spare for others; to have time for the work that you enjoy, and time for the people in your life, and to have the occasional luxury that puts the spice and extra pleasure in life.

Between my Comfort and your Personal Economic Liberty are many different levels of income and asset acquisition. Comfort is a level of choice in living that can be easily gained with an average income, if well managed, by not seeking to have all that everyone can have, but only those things that you really need, but having them in abundance, with quality, and sufficient leisure time that you need to enjoy them in. Comfort does not allow for the complete control of your life as Personal Economic Liberty does as that is a state of wealth and power beyond the ability of the average community member.

Young people must first be taught what it is in life that they need to be living comfortably, and then what they long for above and beyond that can be the driving force to take them into the state of being Independently Wealthy if that is their desire.

The problem always will be in showing people how to work towards that true wealth if it is within their ability to strive for, but they must also be informed of the real cost of acquiring that wealth. Not everyone is willing to pay the price of acquiring the level of wealth that is needed to acquire Personal Economic Liberty, and not everyone that is willing to pay the price has the ability.

Great post.....and it articulates the choices we made a very long time ago.

My now wife and I were fortunate to both work hard as well as be at the right place/right time with Amazon and left just before the Dot Com Crash.

We moved half way around the world and made some good choices.

But I have always kept periodic track of financial performance comparing post Amazon life with a hypothetical one if we had stayed.

In 2013, we would have surpassed our NZ financial performance, if we had stayed with the company.

But after a fairly brief conversation we figured it was not even close to an apples/orange comparison as the $$$ comparison fails to account for our vastly improved quality of life, but most importantly the time we have had to pursue exactly what we want to pursue, without the shackles most people are either born into or voluntarily place themselves in.

My wife said that I should factor in a $$$ value for every hour of free time gained since then to try to get a better(although still an impractical comparison).

I think of the optimal financial threshold for your concept of Personal Economy Liberty as a quote from Warren Buffett:

''enough money so that they would feel they could do anything, but not so much that they could do nothing.''

[santafe2]

Re: money vs happiness

kurt vonnegut and joseph heller were at a party hosted by some billionaire. vonnegut asked heller how he felt, knowing that the host made in one day more than heller made in total from catch 22, his best seller. heller replied that it was ok, because he had something the host would never have. what was that? asked vonnegut. "enough," said heller.

Here's the poem from the New Yorker:

Joseph Heller, an important and funny writer now dead,
and I were at a party given by a billionaire on Shelter Island.
I said, "Joe, how does it make you feel to know that our host only yesterday
may have made more money than your novel 'Catch-22' has earned in its entire history?"
And Joe said, "I've got something he can never have."
And I said, "What on earth could that be, Joe?"
And Joe said, "The knowledge that I've got enough."
Not bad! Rest in peace!"

--Kurt Vonnegut

And to honor the man who ensured that poem and idea were not lost to history, here's a link to Robert Sutton's book. I love the directness of his observation and it is a rule I've enforced at every business at which I've worked or owned over the last 30 years. I may be forgetting one of the top tenets of running a successful business but this one comes right after the one that roughly points out, a business makes money, a hobby does not. And there's a third one, make a list in two columns of the employees you can lose and the ones you can't lose. Don't be wrong. I'm fairly sure they all say, be a leader, set an example, know when you have enough.

http://www.amazon.com/gp/product/044...rismartenso-20

[Polish_Silver]

Re: money vs happiness

Until they do a study of those that purchase their freedom with it.

Right. Money matters when it frees you from oppression, persecution, or physical poverty.