Does money buy happiness?
According to the authors of Happy Money: The Science of Smarter Spending, the answer is “it depends”.
“Yes” it does if you make less than 75 large. Once past that threshold, you actually get less incremental happiness from each extra dollar. I see you shaking your head in disbelief as you scratch your Supreme lotto card (the purple and gold one with 12X $2 million dollar prizes), yet the two authors, one of whom is Elizabeth Dunn, a professor of psychology at the University of British Columbia, insist that it’s true and have pages of research to prove it.
It’s good to know that dinner with friends and parsing out treats like watching Arrested Development counts for more than luxury cars and jewels. That’s welcome news because, as another author, Niall Ferguson, has kindly pointed out in his book The Great Degeneration, we’re heading into some lean times. (At least most of us are.)
It’s not our imagination: social mobility really has decreased precipitously in the past 30 years. And, being a Scot, Ferguson concludes that things are only going to get worse because of onerous government debts that will force a slew of unpleasantness for the lumpen proletariat (that’s us!), including health and social security cutbacks, increased taxes and inflationary fiscal policies. Also, as a bonus, Ferguson adds that civic pride will fray. So, you can see how reassuring it is to know that money doesn’t buy happiness, especially when there’s likely to be a lot less of it to go-around. (Money, that is.)
Like other durable species, humans are remarkably adaptable to changing environmental conditions. That’s generally a good thing but flexibility comes with its own costs. For example, a recent story in The Globe and Mail showed that Gen Ys (Millennials) are lowering their living expectations. Wedged between soaring education debts, a rocky job market and sky-high real-estate costs, many have abandoned the dream of owning their own single-family homes. Instead, they’re anticipating some version of communal living once they can whittle down their debts. Kudos for managing expectations guys. But why should you have to be the ones to adapt?
Instead of accepting the status quo that supports the growing wealth of a small segment of the population, a time will come when it’s challenged. One unlikely Robespierre appears to be Robert A.G. Monks. A Boston Brahim who has held senior level positions in corporate America in addition to the Reagan administration, Monks has had it with corporate greed and poor governance and, as an insider, he is in a position to do something about it. In his book Citizens DisUnited, he issues a call-to-arms for individual investors to lose their passivity and demand corporate transparency to challenge, among other things, excessive executive salaries and corporate policies that work against public interest—essentially robbing us all.
What degree of discomfort will it take for us to demand a re-set to the status quo? Everyone knows the sad tale of the frog: the frog sits in a pot of water on the stovetop. The heat gradually rises. Once he realizes the water is hot, it’s too late to jump out.
Let’s not be frogs, okay?