A favorite parable of mine is the story of a poor farmer who owned a horse. One day the horse broke free and galloped away. All of his neighbors witnessed the calamity and rushed to his side to sympathize with him for this misfortune. He simply responded with a shrug and said, “Maybe yes. Maybe no.” That story illustrates just one of the valuable points made in the book The Geometry of Wealth – How to shape a life of money and meaning by author and investment educator Brian Portnoy, Ph.D. While most of us are familiar with the assertion that beyond a base level, money doesn’t make a person happier, Portnoy offers a more thorough perspective. At the same time, he reminds us that there are usually at least two sides to every situation. And it appears that money may be exactly the same.
So, what was it about that horse that may or may not have been lucky? A day or two after the horse ran away, the horse returned bringing an entire herd of horses along with him. Now the neighbors came to congratulate the man for his new good fortune. Again the man responded by saying, “Maybe yes. Maybe no.” A day or two later, when attempting to tame one of the wild horses, the man’s son fell and broke his leg. Now the neighbors all shook their heads and frowned while telling the man how unlucky things had turned out to be. The man simply replied, “Maybe yes. Maybe no.”
A week later the military rode into town to draft all of the young men into fighting a faraway war. But because the owner’s son had a broken leg, he was not eligible and remained at home. Now the villagers heaped congratulations and praise on the man for being extremely lucky. And once again, all the man said in return was, “Maybe yes. Maybe no.” The lesson of course is that it takes a long view and wisdom to realize that every circumstance carries repercussions and that nothing is solely bad or good—including money.
As an investment educator Portnoy claims that in all of his lectures and workshops a primary question regarding finances always comes up. That question is, “Am I going to be okay?” Like it or not, money is a huge factor in all of our lives, and how we relate to it and what it means to us is one of the fundamental questions that affect our wellbeing and happiness. In other words, it is impossible to talk about happiness without having a sense that we will be “okay” and have the resources to live the life we feel called to live.
A key, of course, is recognizing that rich doesn’t mean the same as wealthy. According to Portnoy, rich is a push for more on “a treadmill on which satisfaction is typically fleeting.” Instead, “Wealth, by contrast, is funded contentment. It is the ability to underwrite a meaningful life—however one chooses to define that.” Going a bit further, Portnoy asserts that, “Wealth, truly defined, is only achievable in the context of a life in which purpose and practice are thoughtfully calibrated.” What that means to me is that unless we are practicing what we feel called to be, do and create in this world, all the money in the world will not make us happy.
Unfortunately, although money is an incredibly integrated part of our lives and wellbeing, most of us will do just about anything rather than talk about it. A study quoted by Portnoy states that “73% of Americans say that money is the most stressful factor in life.” Yes, more stressful that death, politics and religion. Yet unless we are willing to spend the time to explore what our “money lives” means to us and how it all plays out, most of us are either in deep denial or stuck in destructive patterns.
A critical factor in achieving funded contentment is both planning and recognizing at the same time that adaptability and change are always part of the equation. Calling it “adaptive simplicity, “ Portnoy quotes author Timothy Wilson who says, “those who fare better in life have better coping strategies in the face of adversity—they confront rather than avoid them, plan better for the future, focus on what they can control and change, and persist when they encounter obstacles instead of giving up.”
Then what is it about money that can make us happier, or not? Portnoy teaches that we must first identify what matters most to us because only then can set our intentions towards creating a joyful life where money fits in. Behind this thinking are four key areas Portnoy believes we must first recognize and plan to include. He calls them the “Four C’s”:
- Connection is the need to belong.
- Control is the need to direct one’s destiny.
- Competence is the need to be good at something worthwhile.
- Context is the need for a purpose outside of one’s self.
I think most of us who study happiness are well aware of the recent research that proves that happiness does not increase beyond a certain income level. That news is a reminder that the pursuit of more, more, more is not what really matters to us on a deep soul level. Owning a bunch of stuff or having a bigger bank account is a treadmill that can never be turned off. Portnoy suggests that what we really crave are his four C’s.
On the flip side, I doubt any of us would deny that money alleviates poverty and the corresponding pain that it brings on all levels of experience. Portnoy goes further by pointing out that in many cases, money is actually better at diminishing sadness than increasing joy. In addition, one of the more interesting points and usually not one that is part of the discussion is that money does increase a certain type of reflective happiness—and it is the awareness, understanding, and balance of all types of happiness that leads to funded contentment.
So again, can money buy happiness? Maybe yes. Maybe no. Or maybe it depends. Of course, the type of happiness that Portnoy refers to is Eudaimonia—or joy, not the fleeting experience of pleasure or pain. What does more money offer us? Primarily it allows us to live more of the four C’s—which in turn allows us to underwrite a meaningful life with experiences like:
- Funding quality experiences that deepen our connections to others.
- Doing things that bring us joy rather than “having” things that quickly lose their importance in our lives.
- Allows us to be generous to others and share our gifts which in turn brings us joy.
- Gives us more time to pursue the things that give our lives meaning and purpose.
But that isn’t the end of the story. How then do we get to funded contentment without selling our soul in the pursuit of the money to do that? Portnoy is clearly a strategist and offers a number of practical tools to arrive at ways to achieve the adaptive simplicity he recommends in terms of finances and investments. He believes that “Self -awareness and self-control” are key principles needed along the way. Portnoy suggests that the amount of money we make and have is not what’s most important. Instead he says, “The issue is calibration: Have you synced your scorecard with the life you want to lead? If so, you are wealthy.”
Even though I was offered this book for free in return for an honest review, I typically avoid most financial planning books. However, I found most of Portnoy’s advice interesting, accessible and relevant to a SMART Life. I did skip one chapter entirely when it bogged down in far more detail than held my interest, but I fully appreciated his messages about money, investments, and happiness that I found throughout the book.
Many of us avoid the topic of money. We end up doing what we’ve always done or just stay busy with what requires attention right in front of us. Yet always lurking in the background is that question, “Will I be okay?” The SMART approach is to always inform ourselves and do our best to stay as aware, engaged and as responsible as possible with those things we can adjust, refine and even rightsize. As always, each of us has the choice to either create our lives by design—or take what we get by default. Our money lives are no exception.
Okay, your turn. Have you managed to reach that sweet-spot of funded contentment in your life? If yes, please share some of the things you do that help you maintain it. If not, why not? If you have a few clues about why it hasn’t been working, maybe sharing them will help us all get clear about ways we can improve. Please share any thoughts you have on those questions or this post in the comments below….