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Dalton Wealth Management …
The Economics of Happiness
David M. Dalton, JD, MBA, CFPR
Financial Consultant and LPL Registered Principal
Society and the media lead us to believe that having lots of money and material possessions is the ticket to happiness. Recent research suggests otherwise. Let's look at money as an example. Since Elvis made his first appearance on the Ed Sullivan show in 1956, the average American's disposable income (in 2000 dollars) has tripled from $9,431 to $27,792, according to data from the Bureau of Economic Analysis. However, as reported in the book "Happiness," by Richard Layard, our level of happiness hasn't increased at all during
that time.
Happiness from money is relative. As long as we make more than our "comparison" group, money makes us happy. It turns out happiness is partially based on "staying ahead of the Joneses." Even young people are money focused. The latest UCLA annual survey of college freshmen indicated that nearly 75% said it was essential or very important to be "very well-off financially." That's up from 42% in 1966, the study's first year.
Don't get me wrong. Money per se is not bad. It's what we do with it that counts. OK, so if becoming a millionaire is not the passport to happiness, what is? According to various studies, there are six keys that can make
us happier.
- Build strong family relationships. We need the closeness and love of a family. By contrast, (not surprisingly) divorce and separation are two situations that can cause the largest drop in personal happiness.
- Secure an adequate financial situation. As described above, a certain level of income is necessary for a base level of happiness.
- Find rewarding and meaningful work. Finding work that makes us feel like we are contributing to society and helping others is also important.
- Cultivate friends and a local community. Research from the University of Chicago's National Opinion Research Center indicates that people with five or more close friends are 50% more likely to describe themselves as "very happy" compared to people with fewer friends.
- Focus on health. We tend to ignore our health – until we don't have it. By proactively trying to stay in shape, we can feel better, live longer and be happier.
- Be grateful. It's easy to lament what we don't have but it's better to focus on appreciating what we do have.
Yes, life can be difficult and unfair; however, by consciously focusing on the six items above, we can improve our odds of living the good life and experiencing happiness. If you would like to make a no-cost appointment to discuss retirement and estate planning to ensure you are on the road to a secure financial future, please call me at 513-785-3512.
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