Does having more money actually make you happy? This is a question that has been on my mind since I was teenager. I never really knew what is was like to have lots of money (filthy rich), but I felt that my parents were financially solid and never knew want.
We always had new cars and our house was always in perfect shape- my dad built the house and also fixed everything as soon as it was needed. I went to good schools and enjoyed a wonderful childhood. I had all I needed, and to me, we were rich. As I got older, I realized that we were not rich, but my parents were very good at keeping on budget and prioritizing things in our lives.They took care of it all, so I had no worries.
In contrast, my older siblings were children long before I came along. They were around when my mom and dad first started out (I came along almost 20 years later). Over the years, I heard how they had a hard time when they were young. Although they went to private schools, like I did, my father was just getting his footing in the workforce. Whereas when I came along, he was talking about retirement.
I am sure that they did not think they had it bad at the time. I think that when they compared it to how I had it, they seemed to think their upbringing was not as extravagant. Also, my parents had to split their time between multiple kids at once, as opposed to just me. When I came along, they were essentially out of the house. Also, my father was basically retired when I was young, and we did so many things with each other until the day he died. The dad I knew was somehow different than the one they knew.
Money was never an issue in my mind, and I really do not know when it started to become such an issue. I do know that seeing my father retire early put a serious notion in my mind about living up to my father’s legacy. I was so proud of my dad, and I wanted to do, for my kids, what he did for me. Along the way, the dream has gotten bigger and so has the potential expense. I see the budget and know that there is only so much that can be earned and spent and invested. What do you do in that case? Do you say, ” No?” I know that I have been saying that recently. I do not want to do it, but what is the alternative? Go into debt? Stop contributing to the savings and retirement? Hard to say, but more money seems to be the answer. But, how much more?
I do think that a certain amount of money can bring happiness in our society. When you have way more money each day or month or year than you have to or want to spend, the day to day worries in life would seem to disappear. Oh, I am sure other worries would push their way in, but they would be a reality either way. If money issues were not part of everyday life, I am more than certain that life, as we know it, would be much less complicated, and day to day life issues would probably smooth out as to be hardly noticeable.
For example, the average person who’s car breaks down either has to do it themselves or have a mechanic fix it. The cost could be an issue either way. However, for those with lots of cash, the issue is just another phone call away from being fixed, and while it is being fixed, the rental car or taxi is a non issue. If the roof is leaking, the well off person calls a repairman, whereas the less well off person might have to have to empty the buckets for a while.
I am quite sure that the well off person would just take those things in stride and get on with their day. However, for those who do not have the money or time for repairs, life might feel like it is weighing extremely heavy on their shoulders.
I know in my case, if my current income was increased by a few thousand per year, my life would be so different. I would like to be in the position to fund my retirement and have that same amount of cash available to add to the living expenses right now. If that was possible, I would not even dream of adding more things to my life such as a bigger house or a new car. I would just live my life, while saving and investing the rest. Also, enjoying my time with my wife and kids would be even more pronounced.
I do not know how excited I would be at the thought of actually going out to work more in some form of labor to get that extra cash. Working at a job for more time than I currently do would not allow me to do the things that I want with the money. However, passive income from dividends and rental property is a possibility. The only thing is that in order to get more dividends, I have to put more money in the accounts. Well, that is not possible because I am already doing everything possible. Also, I do not have any desire to buy any more rental property. It just is not on my agenda at this time. It seems that I am in a catch 22. I am damned if I do, and damned if I don’t.
I know that I add up all kinds of numbers each and every day. Sometimes I wonder how much it would cost to just live in Disney 365 days per year. Could I make a deal and get an absolute bargain? Should I rent out my house and go travel to another country and live off the land? So many dreams, and yet, all of them require tons of money-at least from my perspective. All of these questions are difficult to answer. However, I do know that if I had passive income of $1500 per week and all my expenses covered, I would be the happiest dude walking. That was pretty much the number I had planned for when I was a teenager. However, things change and life adds to the pile. I made a few “wrong choices” along the way, and the number never really materialized as such.
I did not realize that property taxes would quadruple and insurance would do the same in the matter of a few years-For each and every house. My income has never increased at such a rate. Food has skyrockered, and although gas has fallen in the past few months, it was almost $4/gallon for quite some time. Expenses keep rising, and unless you do without, it is inevitable that income must move higher in order to pay for basic life expenses. I guess I could stop driving, or stop eating as much, or stop using my phone, but where is the fun in that?
I guess the best way is to continue the path that I am currently on. The dividends will, over time, be the main source of income. If I put the money in the Roth’s to good use, that potential income, when added to the other accounts, could eventually be enough to finance my retirement dreams. However, by that time, my rental income will be taxed quite extensively because, by then, the depreciation might be virtually 0. Then, the taxes will increase rapidly. Regardless, time will tell.
I may not know if money buys happiness quite yet, but I sure would not mind having a nice tidy sum coming in that was not to be used for bills or retirement to really test that theory.
How much is enough?
Do you think you would be happier with more income? How much more?
Robert the DividendDreamer