WHY IS IT SO HARD TO BE RICH AND HAPPY?
Updated: Apr 15
Having spent a lot of my life researching what makes people happy and also working with wealthy families, imagine my surprise when I discovered that wealthy people are the least happy folks in America! Yep, that's what the research shows.
How can this be true? I know plenty of business leaders who think wealth and happiness are exactly the same thing.
No one would argue that being poor leads to happiness, but it turns out that poor people in America are actually happier than rich people. The happiest group is the middle class. This is all very confusing. How does it make sense?
Consider these two pieces of evidence:
First, The Principle of Balance & Justification (PB&J). This comes from my book, and it turns out that many important things plot well on the Normal Distribution; i.e., too little or too much of a thing leads to sub-optimal results. For example, take conflict resolution. Being passive and unassertive about your needs doesn't work well in achieving win-win solutions (too little), being assertive works the best (the right amount), and crossing over into being aggressive/uncaring about the other person doesn't work well either (too much).
This principle certainly applies to money and happiness (see figure and rationale below).
Second, from the research in Positive Psychology, the four major sources of happiness are:
1. A caring relationship with yourself (good physical and mental health).
2. Caring relationships with others (we're biologically wired to form close relationships with others).
3. Work you love doing (paid or not, because you spend so much time at it).
4. Enough money to pay your bills with some left over for having fun.
Many people who get rich do so by focusing primarily on the money part of happiness and under emphasizing the other important aspects, thereby creating a lack of balance and a lack of overall happiness. Maybe you've heard the story of the CEO who spent the first half of his life getting rich and the second half paying off his ex-spouses and trying to buy back his health?
Also, children of wealthy families have a higher incidence of drug use, depression, and suicide than the general population. If you think about it though, this makes sense if what they've seen growing up are role models who value money more than people (including them)?
Furthermore, if you want to create a lifetime of unhappiness for your children, just give them a large sum of money they didn't earn. They'll spend the rest of their lives afraid of losing it and knowing they likely couldn't recreate the financial success if they had to. It will undermine their self-confidence and self-esteem from that day forward because confidence and esteem are built by overcoming obstacles and mastering life-coping skills. Wouldn't it be better to give them the gift of self-reliance instead?
1. Create a clear definition of success and happiness for yourself, and be sure it's about more than financial success; i.e., don't spend all your time focused on only one of the four major sources of happiness.
2. Stay balanced and enjoy the ride--don't wait until you have lots of regrets to realize how important this is.
3. I don't think John Lennon was exactly right when he said “All you need is love,” but relationships are a big part of lasting success and happiness in both your business and personal lives.