The logo I chose for the 16th year of our newsletter is a golden figure balancing between time and money. It fit my philosophy and my work precisely and its meaning continues to be powerful.
We constantly attempt to balance our time between things we have to do and things we want to do. We balance our money between things we have to spend it on and things we want to spend it on.
In this article, I’d like to focus on the impact our spending has or can have on our happiness. I’ve just read a book called “Happy Money” by Elisabeth Dunn and Michael Norton. The premise of the book is “if you think money can’t buy happiness, you’re not spending it right!”.
If happiness is what we desire, spending our money only in ways that makes us happier should be our strategy. The book reviews all the studies done on the kind of spending that makes us happiest – and surprisingly they are not what we may intuitively think.
The five core principles of smarter spending – described in “Happy Money” are as follows:
1 – Buy experiences. Purchasing things often creates significant happiness – but for a short time. Studies show we get used to that new big screen TV, new house, new car very fast and it now becomes the standard. Much of the economy is based on consumption – falling into the “consumption trap” is like taking drugs – the ecstasy lasts only for a short time and you need another hit. A major trip – (like climbing Kilimanjaro) can provide years if not a lifetime of enjoyment – from the anticipation to the fond memories of the experience.
2 – Make it a Treat. Not surprisingly, delaying gratification and waiting for that major purchase can increase our satisfaction. I booked an afternoon tea for Elisabeth and I at Chateau Laurier a month beforehand – this gave Elisabeth lots of time to tell her mom and girlfriends about the tea and of course time afterwards describing the experience to all of them.
3 – Buy Time. There are things none of us like to do – so why don’t we hire someone to do them and have the time to do more of what we really like to do. I could handle our service with only one person (Nancy) but then I would have to handle a few things from time to time that I’m not great at and don’t like to do – having Andrew handle the extra client service items frees my time up to spend writing this article!
4 – Pay Now, Consume later. We all have this aversion to paying for things up front – but really enjoy getting experiences for free. So why don’t we manufacture the free part? I had to pay for our Spartan experience (for Sasha and Nik) in April, 3 months before the June 15th event. When the day came, it felt like I was getting the whole thing for free – including T shirt and Spartan medal! Paying for a trip long in advance makes the trip just that more enjoyable.
5 – Invest in Others. We all get enjoyment out of buying things for other people – why would be pay more for a gift than we would if we purchased it for ourselves? We are all inundated with donation requests from many important charities. Donating to charity is one area where we can gain a lot more happiness, if we did it right. When I climbed Kilimanjaro in 2011 we included raising some funds for the Amani Children’s home at the base of the park. The home houses and teaches children abandoned by their parents. Raising the funds and going to see the charity at work made the effort so much more enjoyable.
If you are interested in reading more about how to spend your money to make yourself happier – send me an email with “Happiness is spending right” in the subject and I will send a copy of the book, “Happy Money” to the winner of the draw from the entries received by July 22nd. I’ll let all know when the draw has been completed. (email@example.com)