Hi everyone! Back from a mini-vacation with my husband and good friends! Hope you all had a fabulous weekend!
While I was on vacation, I started and finished 2 personal finance books (who reads personal finance on vacation?). I love Jean Chatzky (you may have seen her on the Today Show or on Oprah) and I picked up her book "You Don't Have to Be Rich: Comfort, Happiness, and Financial Security on Your Own Terms". I thought it was a great book, and it had many interesting points. Three interesting points:
1) The amount of money you make has no bearing on your happiness - so the old addage "Money can't buy you class"....whoops, (too much Real Housewives of New York) I mean "Money can't buy you happiness" definitely rings true. Unless you are destitutely poor and cannot meet basic needs like food, shelter and clothing, the more money you make does not make happier. The research Chatzky conducted consisted of asking questions about happiness with your health, self-esteem, job satisfaction, satisfaction with friendship, relationship with a significant other and financial happiness to 1500 people. Once people made about $50,000 (close to the median salary in the U.S.), happiness in all categories was about the same. This is probably because once you make more money, your habits change. You start spending more because you tell yourself you deserve it or you somehow validate your extra spending to yourself. However, one thing the research demonstrated was that money could make you miserable. If people had too many bills, were incapable of balancing their household's budget, or constantly worried about the state of their finances, money turned out to make them unhappy, even if they made a six figure salary. Mo' money, mo' problems.....
2) Living within your means - I know, this probably gets so old. You hear it from us all the time at Lean with Green, but people (except you, dear readers!) don't get the message. According to the research, most people can meet basic needs (mortgage, groceries, utilities, etc) and they also have enough money to have a good time (65% of people said they had enough money to travel, eat out, shop, etc). But less than 1/3 of people could weather a financial hardship, 1/4 of people said they save the amount they would like for retirement, and 20% say they have enough for their children's education. What the what? People would rather go on a trip than save for retirement? Okay, yeah me too! But if you're shorting your future and your kids' future because you like cashmere sweaters in every color, something's gotta give. If you're already contributing to your retirement, have 6-12 months of living expenses saved, and have plans for your kids' education (if applicable), then go to the Bahamas! But I'm assuming for most people, you need to get to work and stop robbing your future self.
3) Make an "enjoyment list" - make a list of things that make you happy. That way, you know what adds to your happiness and you might be surprised to find that many of those things costs little to nothing. What's my enjoyment list? Getting a hug from my husband, spooning with my dog, taking a bath, a cup of coffee with a friend, hosting dinner parties, a long walk on the beach, eating Thai food, Sex and the City marathons, reading a good book, board games, cooking and baking, kickboxing, breakfast for dinner, blogging, Maui, family get-togethers around the holidays and good hair days. Almost everything I mentioned on that list is free or low cost. And Maui isn't free or low cost, but it's something I wouldn't mind saving for because it truly makes me happy (AND I have an emergency fund and contribute to my retirement - ha!).
Chatzky's book was great, and I'd highly recommend it. She has a lot of interesting statistics from her research, and she offers some good pointers for general personal finance from getting appropriate life insurance to how to consolidate your credit cards to save money and more.
I'm curious about what you all think - do you think money makes you happier? What are some things on your enjoyment list?