Read this NYtimes article this morning about money and happiness. That was not a directive to you, rather, I read it this morning.
My mom sent it to me via virtual clippings, which have replaced the actual clippings that I received from her all through college. They would arrive in an envelope with a heart drawn around her initials, and at least 1/4 of the article ripped off from the careless way she had removed it from the magazine. These clippings represented most of the mail that I received in college. Except the credit card applications. There were more of those than clippings. My freshman year when I was friends with all of the athletes in my dorm (before I really found my place with the alternanerds) one of the super cute identical twin lacrosse players and I became penpals to make our mailbox visits more rewarding. That was the first of my many imagined college relationships. My notes were more frequent, his less until my optimism was drowned out by my realism, and his super cute new girlfriend.
But I digress.
The article authors suggest that hard statistically significant numbers to back up these assessments.
I didn’t read those. But you can if you want.
The co-authors Dunn and Norton are from Harvard Biz school and some BC school that I’m sure is also a great research institute. It is a preview of their book about money and happiness. I’ll share with you the boil down points.
- Having enough money to be out of poverty makes you significantly more happy than not
- Your first taste of something brings you the most happiness, it diminishes from there
- Earning more than $75,000 per year makes you no more happy than $75,000/yr
- Giving away your money makes you happier than spending it
- Saving it makes you happier than spending it but not as happy as giving it away
Money is an historically fraught issue for me. Started with little. Then had lots. Then less. Then more. Then lots again. Some due to luck or bad luck, some due to good choices or bad choices. The only commonality through those financial peaks and valleys was my lack of plan and care. I had it, I spent it (or gave it away). I didn’t have it, I spent a little less of it. I earned it. I gave it away, spent it, invested it. I was a little boat bobbing in an ocean of possible costs and opportunities.
Beyond the three broad actions of saving, spending, and donating the authors didn’t address financial mindset. I’m interested in how planfulness of spending, saving, and donating would be linked to happiness.
I can tell you that I have given a lot of money away in the past two years. Ostensibly I am “investing” this money in local companies…but when I actually write the checks I never expect to get the money back. Sometimes it feels great. Sometimes the opposite of great.
The biggest change hasn’t been happiness, but rather mindfulness. I open statements. I check electronic accounts. I read prospectuses. I have a mix of what I “risk”, save (invest in low risk blah blahs), and spend.
I come close to drawing from the correct buckets. It is an approximation of a plan. When an opportunity to donate (invest?) comes to me and I have already given away my 2012 allotment of money I feel tense. I want to stick to my budgetish, I also want to help these entrepreneurs. I know that that bucket is not bottomless. I can’t keep dipping in to finance every project that interests me. But I want to. And now there is research to support that instinct. Alright.
I’ve been kicking around the idea of angel investing in concert. I know there are big organizations that do this, but I am looking for something informal. Where this investing is really working as a form of charitable giving rather than strict attention to a bottom line. Its how I have been doing it for the past decade, and so far I have actually netted out positive. This makes me happy mainly because it means I can “give” more away. If anyone wants to join forces in this effort let me know. My interests are Vermont, Food, Software, and the environment.
I would also consider a pen pal like Pete, but maybe we could stop at the first letter exchange, I hear the first is the best and it all goes downhill from there.
*If you have never supported a social venture, or structured a low or no interest loan to a small business or non profit organization you should probably talk with your lawyer and accountant. Like I sort of do.