How Much Money is Enough - Two Ways to Figure it Out
Hey gang. Given the unusually high number of posts lately on how much money is enough to retire, what rolex should I buy, what luxury car should I purchase, and how much to spend on an engagement ring, I've decided to offer up a slightly different take with two ways to finally figure out how much money is enough.
But first, let me start with a story.
My grandpa was honestly one of the happiest retirees that I've ever met. He lived in the same house since the 1970s in a middle class to lower middle class neighborhood, never accumulated much wealth, and lived on a meager pension. In his retirement, he enjoyed his hobbies: working in his garden, tending to his orchard out in the country, and doing woodwork. Almost every day, he would get together with a different neighbor and have coffee. In the evening, he would read a little and watch a little tv and would then call his friends too old to visit any longer.
I remember watching tv with him one night and I asked, "Hey grandpa. Do you want me get you a better package with more channels? Don't you get bored with these?" He replied, "I've never been bored a day in my life. There's always something to do. Don't worry about it." The guy lived an outstandingly satisfied life and was loved by all.
Now, to the question...
How can we get enough money to fulfill our dreams?
1. Alternative one is familiar to this website. In fact, WSO does a great job of guiding the way. Go to the right school, the right bank, the right PE firm, and so on and on. Buy an intro level luxury car, then a Porsche, a better rolex, get the right suit, the right shoes, etc. etc. With this career path, all of that can happen if you play your cards right. But strangely enough, I can't tell you how many people I've met that have $5 million in bank but are still trying to get more. At a certain point, it becomes absurd…how much square feet do you really need in your mansion?
2. Alternative two is work on your spirituality. Reflect on what matters in life. Read the great authors, about Buddhism, Jesus, Allah, whatever floats your boat. Read some psychology books, some philosophy books, the arts, anything that gets you thinking. Every week try to reflect on what is important and what is not and what you really need in life. Try to get to a point in life where you no longer care about the Porsche, the rolex, the right suit, etc.
These paths are not necessarily mutually exclusive.
You can work hard and achieve success and at the same time have enough insight to not spend it on stupid bullshit. I've been down both roads at the same time. When I started finance, I only thought about being a BSD, driving a Ferrari, and owning a rolex. Now, I don't want any of that. At the same time, I own a nice home in an upper middle class part of town, have a basic luxury car, and earn a decent low 6-figure comp. It's way more than a lot of people, but I honestly don't need a penny more. I don't want a Porsche. I don't want a rolex. If an extra $100K popped into my account tomorrow, I might buy an $80 scotch and pay off part of the mortgage. There is literally nothing material that I want beyond what I have (which is no monastic lifestyle). It took a lot of self reflection to go from being the kid trolling the rolex website to where I am now. You can follow both paths and end up somewhere in the middle.
Only you know the answer.
So, there are your choices. Either keep running the rat race trying to earn more or figure out what you really need or do a little of both. So how much money is enough? Only you know the answer to that. For some people like my gramps, just growing your garden and drinking coffee with friends was enough. However, note that just like working for money is hard, it took him a lifetime of character building to get to there.
In short, you get to decide how much money is enough – there is no magic formula. You can work your ass of for more or you can start caring less about that crap. It's up to you.