happy child with open arms not thinking about retirement planningA sign somewhere in the UK reads: “Money can’t buy happiness.  But it can buy marshmallows, which are kinda the same thing.”

The message encapsulates the findings of research carried out by psychologists into the correlation (if any) between wealth and happiness.

Their conclusion, in brief, is that the happiness we feel in life is linked to the amount of money we have – but that the link is a weak one.

The ability to savour the good things in life – such as a good meal, time in the company of loved ones, a country walk – is more conducive to happiness than wealth.  Indeed, too great a concern with money can reduce our enjoyment of things and experiences that are either cheap or free.

This is something we should all take into account when it comes to retirement planning and money advice.

Psychologists say that when resources are scarce people savour the limited experiences that come their way; and by savouring them are able to enhance and prolong them.

This ability to savour paradoxically seems to weaken when abundance and easy access to the good things in life are at hand.  After all, what is the point of buying a yacht if the basic pleasure of scudding across the sea with spray in your face holds no appeal?

So when it comes to the wealth and happiness debate, it seems that from a psychological perspective more really can mean less.

That is not to say there is anything intrinsically wrong with creating wealth, either for yourself and those who come after you.  There isn’t.

But it is important always to remember that the accumulation of wealth is a means to end, not an end in itself, and that our ability to enjoy and savour the benefits our wealth brings us is just as important.

When planning for retirement or seeking advice on money, perhaps we should all bear in mind the challenge that Harvard luminary and investment specialist George Kinder, recognised as the founder of the Life Planning movement, sets his students.

This is to imagine what it would be like to be told we have only 24 hours left to live and to have to ask ourselves these questions: Who did I not get to be? and, What did I not get to do?

Experience shows that most of us would focus on what we think we feel we have failed to achieve in our relationships with our families and friends, our failure to give back to life more than we have taken from it, or to express ourselves creatively.

How many people die wishing they had become millionaires, do you think?

The underlying message from numerous studies is that happiness flows from within ourselves, from our ability to savour life’s experiences, and has little or nothing to do with wealth and material comfort.

That is not to say that creating wealth is totally unimportant, but that when you draw up an investment strategy, start your retirement planning or take money advice we should do so by first identifying and understanding what it is we want from life and then make the financial choices that will reflect and support your values.

To help you to understand what you are trying to achieve and focus on what it is you really need from your investments, and to arrange a no-cost initial meeting, call The Whitehall Partnership today on 0845 43 49 250. We cover the greater West Midlands from our offices in Birmingham and Worcester areas.

 

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