Wealth: What do you want from it?

So, why do you want to be wealthy? Well, as I see it there are only two fundamental reasons: enjoying a long and happy life and leaving a lasting positive legacy on the world. Deciding between these two options is the first step towards optimal personal finances.

The first point to establish is that there is absolutely nothing wrong with just leading a simple, secure, long and happy life within our affluent modern society. To do this, you only need good health, nourishing personal relationships and a rewarding channel for creative expression (mostly expressed as job satisfaction) and yes, none of these things are very expensive. As shown in the two graphs below, neither the Chinese nor the Americans have been able to achieve that impossible pipe-dream that the whole world seems to be chasing: happiness-through-consumption.

The first two factors (optimal health and nourishing relationships) can be gained by building towards financial security and, if you do not yet have the third (free creative expression), this can be gained through financial freedom. As explained in the linked posts, financial security is very easily achievable and, although it is somewhat more of a challenge, financial freedom is also within reach of anyone who is willing to patiently work towards this goal. In general therefore, a long and happy life can be attained on a very modest budget.  

But even though massive wealth cannot bring any additional happy life years, genuine financial lack most certainly can subtract quite a lot. If you do not have the financial means to look after your health, to afford the leisure time to really look after your relationships or to work in a job you really like, your happiness and longevity will suffer greatly. But again, you certainly do not need to be a millionaire to prevent these ill effects. 

To be honest, the one and only legitimate reason that I can see for wanting to become super-rich is leaving a lasting positive legacy on the world by delivering a fantastic product or service to millions of people and by using your investments to steer the global economy towards ecological, economic and social sustainability. Aside from that, massive wealth really appears to have no constructive use.

In summary, for a long and happy life, you need only financial security and, as an added bonus, financial freedom. If you want to leave a legacy, however, you need financial power, something which is 1000 times more difficult to attain. If you chose the first, money really should be a non-issue in your life since it can be easily attained by simply saving 10-20% of the median developed world income today. If you choose the second, you have to be sure that, for you personally, the feeling of really having made a difference in the world will be worth the years of hard work, pressure and criticism that comes with the territory. Choose wisely…

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