Nimi Akinkugbe Speaks: Why Money Can’t Buy You Happiness

April 15, 2013 – Nimi Akinkugbe Speaks: Why Money Can’t Buy You Happiness

The constant message relayed in our  materialistic society that money is the most important thing in our  lives and the constant desire for more, have had far reaching  consequences for our societal value system and morals.

This unending  pursuit of money has damaged family relationships, the environment and  global socio-economic systems.Sadly, in our consumption-driven society  many of us have come to believe that all our worries would be solved if  we have more money. Indeed, wealth has become the ultimate measure of  who we are, and we have become defined by it.

Chasing after money for its own sake can damage our value system, and we pay for it in time,  health, and stress.

• What does money mean to you?
• Do you have a healthy relationship with your money
• Do you worship it? Or do  you use it as a tool to achieve your goals?
• Does your life depend on it?
• Would you do anything, to get it? What really matters to you?
• What  really does make you feel happy and fulfilled?

It is important to understand your own  money personality and to put it in the right perspective. The ways in  which you make money and how you spend it reveal a lot about your  personality. This relates to the emotional aspects of money such as  needs, values, relationship choices, feelings about earning and career  choices, spending, saving, and investing.

Issues of control, security,  self-esteem, and a sense of well-being are always evident when money  matters come up.What do you need? Abraham Maslow was an  American psychologist best known for his theory of the “hierarchy of  needs” which he developed in the mid-1900s.

This model served as a tool  for understanding human motivation and development. He identified five  levels of human needs that must be satisfied by one’s own environment in  order for an individual to reach his or her full potential.Maslow’s pyramid illustrates human needs  stacked in layers with physiological needs at the base of the pyramid  which involves the most basic needs; that is, what a person needs to  stay alive, such as air, water, food, sleep, warmth, shelter and  hygiene.

At the second level, Maslow places safety, security,  employment, money and financial stability, and good health. By the fifth  and highest level, human beings seek self-actualisation and fulfilment.  We have the desire and the ability to grow; doing something that makes  life complete such as supporting a cause or following a calling to  realise personal potential or seeking personal growth.Why doesn’t the lucrative promotion or  the brand-new mansion in the best part of town keep us swathed in a  permanent state of happiness?

We like to think that if we just had a  little bit more money, we would be happier, but once we attain that  goal, something still seems to be missing. It appears that the more  money we have, the more we want; but buying the car, boat, or bike of  our dreams will only bring transient joy instead of a deep, lasting  sense of fulfilment. We tend to overestimate how much pleasure we will  get from having more money.Certainly, earning more makes us happy  in the short term, but we quickly adjust to a new lifestyle and all it  brings.

Naturaly, there is a thrill in having that shiny new car, but  soon most of us get used to it and start wanting the newer, more  powerful model. Having made a special purchase, we immediately dream of  acquiring the better, “latest” version. Scientists call it ‘the hedonic  treadmill’ – and many people spend far too much time on it.

Professor Emeritus Lord Richard Layard,  Director of The Centre for Economic Performance at the London School of  Economics, in his book ‘Happiness: Lessons from the New Science’,  discusses the relationship between happiness and rising standards of  wealth.A critic of consumer society and the  all-consuming pursuit of money, he suggests that we eventually get  trapped on the “hedonic treadmill”: Our happiness begins to wane as we  start to take the new positive changes in our life for granted.

Money can bring happiness but for the  most part it is temporary. A dramatic change in wealth such as the move  from abject poverty to financial security can significantly increase  happiness, but satisfaction will be transient; its effect will only last  until the beneficiary gets used to the new status.

Layard argues that  once poverty and discomfort have been eliminated, extra income is much  less important than human relationships. So how do we step off that  hedonic treadmill?Having spent several years interacting  with people with various levels of wealth, I am convinced that money  does not in itself create or sustain happiness. It certainly buys very  nice things and does improve the quality of life and a standard of  living.

Yes, money is important, as it helps you to pay your bills, to  educate your children, support your family and so on; but if you rely  upon it as the key to happiness, it can be illusory as it does not  always address life’s real issues, such as, concern for your family,  problems in relationships, and work-related stress.Money can buy food, shelter, education, and experiences, and it pays for health care and day-to-day comforts.Of course, if you don’t have enough  money to send your children to school, can’t provide for your elderly  parents, or can’t afford costly surgery that can alleviate the pain from  an old injury, it would be hard to be happy.

In that sense, money can  buy happiness by eliminating some worries and bringing quick relief to  financial concerns.Beyond that, longer-term happiness is  dependent upon your personality and on realising how fortunate you are  to have the things that truly matter in life: a strong relationship with  God, a loving family, good reliable friends, good health for yourself  and your loved ones, a fulfilling and secure job, a thriving business, a  safe environment, moral values, and freedom. Next to these things all  the money in the world pales into insignificance.

Happiness comes from giving

Having money is a great responsibility  because it enables one to do things for others. Material possessions  eventually lose their sparkle then beg to be replaced. Yet, one can make  transformational gifts by helping others and even shaping or saving  lives. It is through generosity that one can attain the best  relationship with money.

By deciding to make a difference in someone  else’s life, you can give much more meaning to your own. The joy that  this brings is by far the most lasting form of happiness.

About the author: Nimi Akinkugbe has extensive experience in private banking and wealth management. She is passionate about encouraging financial independence and offers frank, practical insights to create a greater awareness and understanding of personal finance and wealth management issues. She is married with 3 children.

Find out more via www.nimiakinkugbe.com