Make plans to make your ambitions happen
Financial failure is a blight on families.
Struggling to make ends meet isn’t the end of the world, but it does make life harder and often increases worry.
I mention this because one of the great myths around money was blown apart recently, a myth I always had mixed feeling about.
It was the myth that poor people are happy and the rich are miserable. Well, it turns out that while there may well be happy poor people, and there are certainly many happy middle-income folk, you’d be hard pushed to find an unhappy multimillionaire.
Researchers in the United States recently reached three big conclusions:
Richer countries are happier than poorer ones
When you’re poor, finding $10 makes you happier than it would a rich person
Doubling your income delivers a roughly equal happiness boost for a millionaire and a pauper.
What does this mean for the likes of you and me?
It does not mean you should chuck in your charitable work and simply strive to make fabulous amounts of money.
Satisfaction and happiness come from many aspects of life, not least knowing you are making a contribution and being a decent human being. Something of that is shown in the correlation between happiness and national wealth.
Ordinarily, richer countries are happier, but the very richest countries are not always the happiest ones.
its climate, beaches and sense of decency, scores highly for happiness even if it falls well short of the top of the richest country table.
But the research indicates that anyone who thinks money is unimportant, is fooling themselves.
But how do you give your finances the priority they deserve?
It’s not always easy, especially if you’re not earning that much.
In my household, we have something of a family philosophy – that every generation should be happier, wealthier and better educated than the last. The great thing about this approach is that it is a long game, and barring war, plague or famine, gains can be made by every family, even ones faced by ludicrously high house prices.
Like everything in life, it requires planning and putting effort into the activities that are likely to get the next generation the gains my mum and dad’s brains, application and financial prudence helped deliver to me.
For me that means prioritising the education of the next generation. I want to be humbled by my children’s achievements.
If there’s a discretionary dollar to spend, we try to either save it or spend it on education or something that genuinely makes us happier and keep frittering cash away in check. It means having a wealth and savings plan and one that includes thinking of saving for the next generation rather than spending for this one.
My aim is for the kids to leave university with no student debt, not to run out of money before I die and to leave chunks of change to the kids or pass through any wealth that comes down to me.
Life is a long and rocky road but without plans and ambitions, including financial ones, it would feel like there were no signposts to follow.