Decreasing the Amount of Money, You Need to Be Happy

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I believe that one of the biggest offenders on the journey to FI is an inflated lifestyle, which doesn’t give long-term happiness, adding instead to the number of financial obligations we have. Decreasing the amount of money we need to be happy, is a long-term lifestyle choice, not a quick fix that can make people feel better for an hour or two.

Photo by Michael Longmire on Unsplash

In my 20’s I used to visit designer shops a lot. During those visits, I usually bought clothes (I still have some of those items and fit into them, as the more expensive brands have much greater quality than fast fashion, so it’s good for sustainability), bags and shoes, of course. Over the years, I gave away or donated many of the bags and shoes I paid so much for. Every time I bought something luxurious, I felt fantastic. That feeling lasted until the evening when it evaporated as fast as it arrived.

Soon enough, I needed another fix, so I kept on spending on things I had nowhere to wear. Every time I earned extra money, instead of investing it nicely, I was re-paying my credit cards or buying more things I had no need for.

Of course, I was desperately trying to fill in the happiness void with my shopping addiction, but no amount of shopping could possibly subsidize my unhappiness. A much better investment would have been travelling, studying, or just staying at home and reading while waiting for my investments to compound.

The social norms aided by the social media culture, corporations and the governments push us to spend what we don’t have, trying to persuade us that more and bigger equals happiness.

In reality, if anyone expands their lifestyle on credit, that comes with a lot of stress and pressure to pay off the debts and loans. From my experience, I can definitely say that financial strains don’t give much happiness. The more money we spend on things that don’t matter or don’t have long-lasting value, the less we have left for travelling, pursuing dreams, taking time off to enjoy life, or retiring early.

Everyone’s time on this planet is finite, and allocating that time to making other people wealthy, while at the same time living an unhappy, anxious, and stressful life shouldn’t be perceived as the optimal solution. With decreased financial needs, lifestyle changes and shifts can happen organically. If the need to pay off credit cards and loans diminishes, you will have extra money to invest, build an emergency stash and focus your financial recourses and your energy on what is essential for you.

Of course, everyone says that money doesn’t bring happiness. However, I think that this saying is very much misleading. Money gives freedom, and that, in itself, is an equivalent of happiness for many. For me, the hidden meaning of that saying is that the race to keep up with the social and cultural pressures often leads to an inflated lifestyle, which doesn’t bring happiness.

However, the changes leading to decreased budgeting should be organic. Otherwise, if we restrict ourselves too much and too soon, it may just create a yoyo effect (think ineffective dieting) and send us on a crazy shopping spree, maxing out our credit cards.

In my case, a slow, organic change is best. I’m pretty excited to experiment with how far I can push myself and still be happy, not feeling deprived in any way while living my best life.

PS. What makes me happy and gets my heart racing is checking my Vanguard account and seeing how much I’ve invested and how much the market has helped my portfolio grow. I’ve become geeky like that; what can I do 🙂

This is my last post for the summer. I’ll be back in September.

In the meantime, head over to my blog section to check out some of my previous blogs.

Don’t forget to read “School Runs” chapters, which were the real catalyst for creating this website.

Other blogs recommendations for the summer:

JLCollins (well, this blog and JL Collins book is a must to learn about investments. On his blog you will also find recommendations for the Europeans)

rich and Regular  (for people with families)

A Purple Life (she writes a lot about what happens after retirement, which is a nice change)

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