Lower your material expectations and find authentic happiness

Dubai school teacher Zach Holz has won a huge following for his blog, The Happiest Teacher, which he launched in January to share his obsession with personal finance with others. Every fortnight he will be writing in The National about his journey towards financial independence and how anyone can ease themselves out of the habit of living pay cheque to pay cheque.

What does it mean to be rich? A new Bentley and a villa with a household staff? Custom-made suits or dresses for every occasion? Not worrying about how you will afford to pay your bills? There’s no real cut-off that is universally accepted for being “rich” and it often comes down to how you feel.

There are many stories about people making Dh1 million a year and barely “scraping by” financially, living pay cheque to pay cheque without anything in savings. Even that much money can be easily absorbed with a high-flying lifestyle common here in the UAE, and in the end, they will be just as stressed as someone making far less who is struggling to save.

This isn’t rich, because they are not secure in their wealth – their high income is all going to supporting a level of consumption that is one emergency away from collapsing their entire life.

But there are many people earning far less who have modified their lifestyles to ensure they spend only a fraction of what they take home. The rest they save, investing it so that their money works for them to provide for the future.

That cushion of money gives them confidence to start new businesses, quit jobs they don’t like or retire early to fully pursue their passions. They won’t be destroyed by one piece of bad luck.

Those people might not consider themselves “rich” per se, but because their expenses are far less than their earnings, they have a level of comfort and security that I consider the goal of getting rich.

There are many ways to increase your income, from promotions at work to changing careers to starting side hustles. I’ve personally done all three of those to varying degrees of success, but I can tell you that even the lowly side hustle can drastically change your financial situation.

At various points of my career, my jobs on the side in tutoring, music, and photography were enough to pay all my bills and expenses for the month and allow me to save my entire pay cheque from my full-time teaching role.

You don’t have to be a doctor or lawyer to make enough money to build enormous wealth. In a 2012 study of millionaires by the consultancy and market researcher Spectrem Group, there were more millionaire teachers than millionaire doctors in the US.

The key to all this is to keep your expenses down, and there are two important ideas to understand here. The first is the idea of “hedonic adaptation”, which basically means that after you buy something, you get a burst of temporary happiness (we often call it retail therapy).

But then that temporary happiness goes away, and you need to buy a new shiny thing to get the burst. This experience also usually requires bigger and bigger “hits” to get the same materialistic high.

Sure, you were happy with your Toyota, but then you got your pay rise and you were even happier with your Mercedes. Until you got used to it and it was just “your car” and then you desired an even more luxurious ride.

This cycle never ends, driving your expenses upwards but never leaving you any happier than when you started. This leads to the second idea: buying things does not lead to permanent happiness, so why buy? Is there a way to shift your thinking away from consumption-driven temporary happiness?

The answer is in your definition of “enough”. If you want less than the average consumer, then your level of “enough” material possessions is also reciprocally lowered. For me, a good quality used car that won’t leave me stranded, and has a decent sound system (gotta have my tunes), is enough.

For me, non-luxury branded clothes that allow me to teach or relax accordingly are enough, and thrift shops are the best friends of my wardrobe. For me, even though I could afford a two-bedroom apartment, a one-bedroom does the trick nicely.

I choose to focus my “happiness energy” on a career that I love: being a teacher and helping children reach their goals. I have side hustles where I create with my band and through photography, and writing.

All of this allows for autonomy and creativity and community, which are three key aspects of long-term happiness. Putting my savings to work for me in relatively safe, productive investments leads to a feeling of confidence and lack of stress about finances.

None of the things that lead to real happiness come from buying stuff, so I lower my level of “enough”.

If you’re able to want less, you can be “rich” on a much lower salary. Your materialistic wants and needs will be met. You will be able to accumulate enough real wealth to retire, which will be easier because you will require less income in your retirement to be satisfied. It’s a win-win situation.

Don’t get caught up in the flashy lifestyles that you see around you. Become rich by being satisfied.

Non-luxury branded clothes that allow me to teach or relax accordingly are enough, and thrift shops are the best