Money-and-Happiness
00:00:00.000 | Hello everybody, it's Sam from Financial Samurai and in this episode I want to talk about solving the happiness money conundrum in five moves or less
00:00:08.000 | So if you live in America or you live in Canada or developed European country or Hong Kong Singapore, Australia
00:00:14.480 | you got more money than the large majority of the world's population and
00:00:20.720 | Yet you might not be very happy
00:00:23.480 | And I think the reason why you might not be very happy is because you're spending too much time
00:00:30.360 | Focusing on money power and prestige and not enough time on everything else
00:00:35.400 | So I don't think money makes up more than 40% of what makes us happy
00:00:40.800 | The other stuff is just much more important, but we neglect that other stuff
00:00:45.960 | Which I'm going to talk about in this episode and I think these are the things that will really make us happy
00:00:51.040 | So after a tense 14 to 12 softball victory, I'm in this weekly law league softball
00:00:57.840 | League and it's funny because I'm not a lawyer. I just decided to play because someone invited me
00:01:02.600 | The six of us went to a nearby brewery for some beers
00:01:06.200 | oysters burgers and so forth and we were just elated because the team was really really good and we got some clutch hits and
00:01:13.400 | I ended up sitting next to this guy really big guy six feet five inches tall
00:01:18.320 | Crushes the ball 300 plus feet and he's our cleanup hitter and let's call him Biff and in high school
00:01:26.400 | Biff said he was a pretty popular guy. He played varsity baseball
00:01:30.160 | varsity basketball
00:01:32.760 | But he also admitted he was a little bit cruel
00:01:34.880 | cruel to the smaller kids most kids were smaller than him and then cruel to the exchange students and
00:01:41.800 | I asked him why was he so cruel and he said well I was
00:01:45.720 | Because I was immature and because I could and he told me he wasn't proud of his actions
00:01:51.760 | And he wished he could apologize to them today
00:01:54.520 | and I see a lot of
00:01:56.520 | Biffs nowadays in the real world and in the online world where you know
00:02:01.440 | They were just kind of cruel and bullies when they're in school and they turned out to be bullied
00:02:07.080 | Bullies and really really kind of nasty people as adults
00:02:10.600 | So anyway after the financial crisis hit in 2008 Biff fell into a deep depression
00:02:16.920 | The house he had bought when he was 27 years old ended up losing half its value
00:02:22.600 | He was told he couldn't lose and that real estate was the surefire way to riches
00:02:27.120 | Not only had he lost all his equity, but he also owed more than the house was worth in just one year
00:02:35.320 | So Biff proceeded to gain over a hundred pounds as he literally locked himself within his rapidly depreciating prison at age 30
00:02:43.840 | He was morbidly obese
00:02:46.000 | broke and
00:02:47.800 | Girlfriendless life had no more meaning to him and he definitely contemplated suicide
00:02:52.200 | But good thing he didn't because one day out of the blue the state of Florida threw him a lifeline by offering him a free
00:03:00.000 | $75,000 to pay off some of his mortgage if he promised to keep up with the regular payments
00:03:05.640 | he took advantage of the taxpayers money and fulfilled his side of the deal and
00:03:10.320 | Despite feeling a little bit guilty for taking the bailout money
00:03:14.160 | Biff started gaining positive momentum in his life again over the ensuing two years. He lost about 70 pounds
00:03:21.560 | he got a promotion at work and
00:03:24.080 | Finally at the age of 32 found a girlfriend
00:03:27.400 | He also very importantly
00:03:30.200 | Stopped hating on anybody and everybody who seemed to be doing better than him because he was finally in a better place himself
00:03:38.440 | The first step to him feeling happy was to make sure his finances were no longer going in reverse. They had stabilized and
00:03:46.640 | Once they had stabilized Biff's happiness grew because he found someone who loved him despite all his flaws
00:03:53.320 | Today, they're married and they have a daughter and he's happy being rich didn't matter any more to Biff
00:04:02.720 | Making progress did oh and being able to win a softball game by crushing it over the fence
00:04:09.580 | 300 plus feet
00:04:11.520 | Makes him really really happy and I tell you the story because I truly believe that money is not the primary driver to happiness
00:04:18.000 | At most 40% in my opinion if you look at the post on the polls
00:04:22.400 | 50% is at most according to about 700 votes if you look at the annual world happiness report
00:04:30.160 | So the latest one comes out
00:04:32.440 | Came out recently and Finland Norway and Denmark are in the top three
00:04:36.240 | and the the reality is that these countries are always in the top five to top ten and
00:04:41.600 | The report highlighted six significant factors which contributed to happiness
00:04:45.240 | GDP per capita social support life expectancy freedom to make life choices
00:04:50.840 | Generosity and corruption levels and if you look at the United States, it's ranked 18
00:04:56.560 | So it's kind of weird because we have by far the largest
00:05:01.200 | GDP in the world, you know, but being 18 there's kind of some kind of disconnect and
00:05:06.920 | It's just such a conundrum that I think and the report attributed several reasons as to why Americans are not happier
00:05:14.680 | They include wealth and inequality
00:05:16.680 | obesity right like my friend Biff substance abuse and
00:05:21.840 | Depression and all of these things seem to kind of go hand in hand together
00:05:27.120 | The United States on a GDP per capita basis ranks only about 19. So that's pretty much in line with the happiness ranking
00:05:35.080 | however
00:05:36.520 | GDP per capita alone doesn't neatly explain why more of the wealthiest countries aren't in the top ten
00:05:41.480 | For example, Singapore has a GDP per capita of about ninety four thousand and that is number seven
00:05:48.040 | but yet it's ranked only 34th in the world for happiness and
00:05:52.200 | My my hypothesis is that's just too damn hot and humid out there in Singapore
00:05:56.160 | So I used to live in Kuala Lumpur Malaysia for four years, but gotta say food in Singapore is top three in the world
00:06:02.320 | So I wanted to figure out
00:06:05.240 | What are the things we should spend more of our time on?
00:06:08.920 | To make us more happy and I want to do some reflection because I think this is really important ultimately financial samurai is
00:06:15.760 | A site to help get your finances, right? So you're no longer going in reverse
00:06:20.720 | You've stabilized you're going forward and you can spend the majority of your time not worrying about money
00:06:27.880 | Really because the money is making money for you and it's going to be there for you, but you can spend more of your time
00:06:34.360 | Optimizing for the other things that hopefully will make your life more meaningful
00:06:39.280 | So there are five things that I think are really important. The first one is independence
00:06:45.160 | Independence grows over time the first taste of independence usually comes when you're able to live on your own without parental assistance
00:06:52.680 | Perhaps it's going away to school or landing your first job
00:06:56.000 | Independence continues to grow once you start gaining respect and mastery at your job the better you are at your job
00:07:02.480 | Generally the more leeway you're gonna be given to do what you want
00:07:05.700 | You might eventually get promoted to run a team or a department giving you even more independence
00:07:11.660 | You finally gain maximum independence when you no longer have to report to anybody
00:07:15.780 | Most think retirement is the ultimate goal, but based on my experience
00:07:19.880 | After being away from the workforce for seven years
00:07:23.200 | Retirement isn't a cure-all for happiness. There's plenty of negatives. You got to deal with as well, which again means money is not
00:07:30.280 | Money is not the main point for making people happy. Some people believe that entrepreneurship leads to maximum independence
00:07:38.480 | Instead entrepreneurship can lead to tremendous dependence if you hire workers and take in investors
00:07:44.120 | What people really want is a profitable bootstrapped solo business or the financial independence to do whatever without caring about money
00:07:52.320 | In my case, I was pretty happy to have a job right out of college, even though they worked me like a dog
00:07:57.680 | But after about I don't know three to six months that happiness really begin that began to fade
00:08:03.660 | Because it's just too stressful and too arduous. So my happiness level is probably around a six
00:08:08.600 | It was only until I moved to San Francisco and got some more
00:08:11.600 | Independence covering West Coast clowns and feeling like I was in a more entrepreneurial
00:08:16.840 | Office environment did my happiness take a tick up?
00:08:20.440 | But then the financial crisis hit and then I was feeling a little bit miserable again
00:08:25.200 | and so it was only after I negotiated a severance in 2012 did my happiness level creep up to about an eight out of ten and
00:08:31.720 | Has remained at roughly this level with temporary spikes to ten and then obviously temporary spikes to like five or six
00:08:38.480 | So for those of you who want happiness
00:08:40.920 | Try your best to figure out an occupation or something that will give you as much independence as possible
00:08:49.040 | Independence has been I think the most important factor in consistently keeping me
00:08:54.560 | Happier at a higher level. So to
00:08:58.360 | Family no matter how much of a knucklehead you are most family members will provide unconditional love and forgiveness
00:09:04.800 | They will support you no matter what it is estimated that average friendship lasts only seven years
00:09:11.040 | Because life gets in the way maybe a job relocate someone you just maybe you lose interest or you have a family
00:09:18.720 | Whatever it is while friends come and go family members last for much much longer
00:09:24.240 | We must make an effort to regularly keep in touch with our parents and siblings
00:09:28.640 | in my situation
00:09:30.680 | I messed up a lot in high school and in grade school gotten you know suspensions because of fights
00:09:36.560 | Did some other bad things and I think in retrospect man. I think I gave my parents a lot of
00:09:42.280 | Headache and anxiety so sorry guys
00:09:44.880 | I'm gonna try to do better. Well, it's actually too late
00:09:48.240 | So I'm gonna try to teach my kids to do a little bit better
00:09:51.320 | But they've always been supportive whether you know when I got suspended from school or when I decided to change jobs
00:09:58.280 | They're like no the money's probably not gonna be worth their misery going to New York City
00:10:02.560 | And when I decided to leave work for good in 2012 at 34, they never had any pushback. They were just like well
00:10:09.640 | That's interesting. Let's talk about the pros and cons and what you want to do just really supportive and even when I
00:10:16.360 | Decided to get married. They were also so welcoming to my wife
00:10:20.560 | So I really really appreciate my parental support and I would say I'd give them eight out of ten
00:10:27.400 | They've always been there
00:10:28.400 | They haven't been like super lovey-dovey like you see in the movies and stuff, but they've always picked up my calls and been supportive
00:10:35.040 | three
00:10:37.240 | Your own family. I think this is pretty important for happiness as well
00:10:40.960 | If you're lucky enough to find a life partner, there's nobody you will love more in this world
00:10:46.880 | If you want to have children, and if you do have children the amount of joy you will experience is beyond anything you can ever imagine
00:10:53.560 | I
00:10:54.840 | Understand that not everybody wants children. In fact about 10 11 percent of you in my survey of over a thousand
00:11:00.320 | Said you do not want children and that's absolutely fine
00:11:03.640 | Having a family made up of just you and your soulmate is incredibly powerful
00:11:08.280 | So much freedom so much joy make it your mission to find someone who loves you as much as you love them
00:11:15.880 | In my situation, I got really really lucky. I met my wife when I was a senior in college and she was a freshman
00:11:21.840 | Because I met my wife so early. I've always had this minimum elevated level of contentment
00:11:27.880 | I knew that worst case if I could only make minimum wage working at McDonald's
00:11:31.760 | At least I'd have her in my life and we'd make things work and she felt the same way
00:11:36.600 | It didn't really matter how much money we had
00:11:38.760 | You know what we did is just like well we have each other
00:11:42.320 | So we'll figure it out and when you have some partner that will always support you and allow you to figure things out as you go
00:11:49.520 | Along, it's incredibly incredibly powerful. And when we finally had our boy in 2017 my happiness
00:11:55.800 | Temporarily rocketed to a 10 10 plus. I don't know maybe a 15 is it was like unlocking a feeling
00:12:02.960 | I had never known before and nobody really kind of tells you that for some reason
00:12:08.000 | But I'm telling you guys who want kids or thinking about kids. There's this unlocked feeling that you have when you have your own
00:12:13.800 | But as many first-time stay-at-home parents know taking care of a kid is tremendously difficult
00:12:20.200 | Some more than others right? I have a boy. He's very strong-willed. He knows what he wants. Like us what he wants
00:12:26.920 | Maybe he's kind of like me pretty
00:12:28.920 | Spool-headed and his temper tantrums are out of control at 26 months old
00:12:33.600 | And so that kind of doesn't make me happy that kind of makes me miserable sometimes
00:12:37.960 | But I wouldn't trade it for the world
00:12:39.960 | for
00:12:41.480 | The ability to stand up for yourself
00:12:43.960 | I don't hear about this much, but I think this is very very important
00:12:48.280 | One of the worst feelings is getting bullied and not being able to do anything about it in school
00:12:55.480 | You might get picked on by a bigger kid. You want to fight back, but you're afraid of getting your face punched in
00:13:01.280 | So you rationalize? Okay better to give him my lunch money and starve than face his wrath
00:13:07.840 | At work, you might get tormented by a senior colleague
00:13:11.800 | You want to tell her stop look just leave me alone. Why are you always making fun of me in public?
00:13:17.120 | Why are you making me look bad? Why are you throwing me under the bus?
00:13:19.440 | But you're afraid of standing up for yourself because you might afraid you might get a bad review from her
00:13:24.760 | You need the money
00:13:27.040 | Because I don't know you're raising a family. You bought a house. You bought a car, whatever it is
00:13:30.960 | online
00:13:33.080 | You're afraid to say what you truly think out of fear of getting ridiculed
00:13:36.280 | As a result you keep quiet and you might even join a mob that bullies others for thinking differently
00:13:43.120 | The fear of standing up for yourself and others is one of the reasons why bad things stay bad for a very very long time
00:13:50.560 | It's amazing how people aren't willing to step up and stand up for what they believe in or defend someone
00:13:58.920 | Who's you know being bullied or whatever because they're afraid of getting bullied or mobbed themselves. It's kind of sad
00:14:05.000 | so my situation ever since
00:14:08.040 | Elementary school for some reason must be DNA. I've had the courage to fight back and stand up for myself. I
00:14:14.880 | Hated bullies and I never never let them push me around or call me names and if they did
00:14:21.080 | They would feel my fist of fury and this was me as an elementary school kid
00:14:25.320 | And what I learned since I was a kid while standing up for yourself is that even if you take a few blows
00:14:30.560 | The bullies eventually stop some start respecting you some may even apologize
00:14:35.760 | The repercussions were plenty frankly
00:14:39.120 | Suspensions multiple trips to the principal's office and a few bruises
00:14:43.640 | But it always felt great to defend my honor. So I've been going through this since at least five years old
00:14:50.880 | I can remember so many altercations from five years old
00:14:54.240 | through college frankly
00:14:56.240 | I've carried this attitude of standing up for myself my entire adult life when there was BS happening at work
00:15:02.880 | I spoke up often to my own detriment
00:15:05.460 | I didn't appreciate nepotism and nepotism is very very strong in the corporate workplace
00:15:10.800 | The higher you go the higher you ascend in the ranks the more it's about who you know
00:15:16.660 | And not what you do and I often challenge senior employees whom I did not respect
00:15:21.960 | And this is terrible terrible career strategy
00:15:25.000 | Don't do what I do if you want to send the corporate ranks and get like that network of support
00:15:30.000 | Because when my big bosses who are in my corner were eventually pushed out
00:15:33.880 | I was left with few backers and this caused me not to be able to ascend to managing director
00:15:40.560 | Among other things right financial crisis and having to relocate to a headquarter office yada yada yada
00:15:46.720 | But for me, I knew my career was over at this firm. I had made too many enemies or just ruffled too many feathers
00:15:53.160 | It's because I didn't it's just I just called out so much BS. It was just whatever and
00:15:58.360 | Then online financial samurai has grown large enough to attract
00:16:02.980 | Unfortunately some hateful comments every week from people like the old Biff
00:16:06.900 | We're talking racist comments just really offensive comments and you know tons and tons of spam is just kind of crazy
00:16:14.000 | you guys have no idea and
00:16:16.320 | Even if only 0.1 percent of the people hate your guts
00:16:19.200 | however, that's
00:16:21.560 | 1,000 people a month if you receive 1 million visitors a month and that's what financial samurai receives about 1 million visitors a month
00:16:29.520 | And actually it's not point 1% It's probably more like point
00:16:33.520 | 001 percent but still even if you have like 10 haters every single month leaving you nasty stuff
00:16:40.200 | It's kind of annoying and kind of perturbing
00:16:43.120 | I generally delete 99% but if someone is stupid enough to try to come at me
00:16:48.480 | someone who doesn't rely on money to live who doesn't have a job to live and
00:16:52.520 | If you're stupid enough to still come after someone in this situation and you yourself need a job
00:16:59.880 | Well, there's probably something bad's gonna happen to you because I'm gonna stand up for myself
00:17:04.440 | Too many people too many people kind of ruin their their careers frankly
00:17:10.600 | Because they do something stupid online social media or whatever. So just really think twice or thrice if you need money to survive
00:17:18.560 | Before you write anything nasty or you come to someone's house and hate on them. It's just not worth it
00:17:24.840 | So this is really one of the biggest benefits of being unemployed is not being able to get fired
00:17:30.160 | So standing up for yourself can feel initially scary
00:17:33.840 | but the more you practice I promise you the easier it'll get and
00:17:37.920 | Then finally the final thing that I think will make people happy or happier is doing work that is helpful to others
00:17:45.840 | One of the reasons why 70% of people are disengaged at work is because they know what they do is probably not very helpful to society
00:17:53.400 | Think about the workers who work at PepsiCo
00:17:55.880 | Their entire goal is to sell sugary drinks and process foods that get people addicted and fat and sick
00:18:03.720 | That can't feel very good and then imagine working at Juul
00:18:07.280 | Their goal is to get adults and teenagers hooked on vaporized nicotine. I mean, how do you feel good about that?
00:18:14.520 | How do you feel good about getting people addicted and hooked to something that's poisonous? It's just beyond me
00:18:20.520 | It doesn't feel good. And I think deep down
00:18:22.600 | Every single employee knows this and that's why again 70% of people are disengaged
00:18:29.360 | But if you create or do something that's helpful to others, you will feel extremely extremely wealthy talk to veteran nurses
00:18:36.240 | Teachers firefighters and social workers really listen to them
00:18:40.840 | You will hear many of them glow about their rewarding careers
00:18:44.680 | Sure, they'll have issues just like everybody else pay office politics and so forth, but it's really a big difference
00:18:52.760 | In my situation before 9/11 happened. It felt great working in finance in New York City
00:18:59.200 | After 9/11, I felt a tremendous amount of sadness
00:19:02.280 | Deep sadness suddenly nothing I did at work mattered anymore compared to what the brave
00:19:07.480 | First responders did to try and rescue the people trapped in the World Trade Centers
00:19:12.040 | I wanted to join the US Foreign Service to actually serve my country and do something more productive like my parents
00:19:18.280 | But I was neither smart enough or motivated enough to pass those exams
00:19:23.640 | It took at least three years to get over my disillusionment of working in finance
00:19:28.800 | During this time. I went to business school part-time
00:19:31.200 | Partly to see if I could gain some knowledge to do something else just kind of explore
00:19:36.040 | That's what you do when you go to business school
00:19:38.160 | but part of the deal of having my tuition paid for was to continue working at my firm for at least two years after graduation and
00:19:45.720 | During this time, unfortunately, the financial crisis had hit in 2008 and there was nowhere I could go
00:19:51.560 | The best I could do was hold on tight for my employment life as I had just taken out a 1.1
00:19:57.880 | Million dollar mortgage in 2006 when I was 28 years old
00:20:01.200 | I mean that was everything I had after the town payment and that's scary stuff
00:20:06.280 | so it wasn't until about
00:20:09.000 | 2011
00:20:11.600 | That I decided that my biggest joy was writing and helping people get their finances straight
00:20:16.640 | I started financial samurai in 2009 during the depths of the financial crisis and
00:20:20.840 | That was a period where I had to really reassess what I wanted to do with my life and by 2012
00:20:26.760 | 2011 all I could think about was financial samurai. So
00:20:30.480 | That's what I did. I finally said goodbye to my employer then and the thing that has kept me going for so long
00:20:38.480 | I mean 10 years. It's just kind of crazy
00:20:41.280 | Three to four times a week of writing something commenting
00:20:45.520 | producing things
00:20:47.600 | It's man. It's just tiring thinking about it
00:20:51.000 | But what has kept me going for so long has been the consistent positive feedback that I get from readers that outnumber the negative feedback
00:20:57.080 | Probably 200 to 1
00:20:59.600 | Over the past 10 years. I've witnessed readers eradicate their debt fix their spending habits buy their first homes
00:21:06.560 | Leave toxic work environments negotiate amazing severances create thriving side hustles build substantial
00:21:14.120 | retirement portfolios start families and so much more
00:21:18.200 | It's been really a wonderful journey and an honor and a treat to hear from each and every one of you. So, thank you
00:21:24.560 | Before you reach financial independence, you might get tricked into believing that money is the main reason why people are happy
00:21:31.880 | It's easy to lose sight of all the things on your quest for greater wealth
00:21:35.680 | However, you can be the richest person in the world
00:21:38.800 | but if you have nobody to share your fortune with I
00:21:41.520 | Doubt you'll be happier than someone making 40,000 a year in a job in which he or she loves
00:21:46.460 | And who has a loving partner and supportive friends in real life
00:21:49.920 | For the sake of happiness. I think it's worth staying fit
00:21:53.560 | finding people in real life who love you as much as we love them and
00:21:57.640 | Doing something that's helpful to others and who knows you might even reach a point where you're so happy
00:22:03.680 | That money starts pouring in as a byproduct
00:22:06.400 | So I'd love to hear from all of you on what you think the proper percentages are for money family
00:22:13.280 | Purpose. I really think we need to focus more much more on everything else besides money
00:22:20.480 | Let's get our money, right? Let's keep it from going in reverse. Let's keep it safe
00:22:25.140 | Let's keep the money productive so that it can free up
00:22:28.440 | Tremendous amount of time to spend on things that truly matter. Thanks so much everyone