How many times were you ready to compromise your free time for making more money? Prioritizing money might deliver that temporary pleasure of fortune, but in the long run, it might actually undermine your happiness. Of course, this doesn’t mean you have to deny the salary raise you have been offered or give away all your wealth. It is true that making more money could give you happiness, but the way you utilize it shapes the joy you get out of it.
A recent survey on more than 500 people in the UK, showed that people with more money in their savings account were happier than those who saw depressingly low numbers every time they visited the bank. Some people might argue saying wealthier people are happier, forgetting the fact that with increased wealth, there is a surge in the lifestyle. With the surplus money, you end up buying more and more things, and to make space for these, you might end up buying a bigger house, and the list goes on. You might eventually reach a point where the ‘surplus’ money, which was giving you happiness, isn’t even surplus anymore, due to the change in lifestyle.
In that case, the idea of saving cash could be intimidating. You might get anxious about cutting down on your expenses, creating a budget plan, and might even end up sacrificing on things. Always ask yourself:
- Is what I buy essential for me?
- If not, is the expense genuinely worth it and brings happiness?
By this method of approach, you can cut down on unnecessary expenses and manage to maintain your money. Especially if your answer to the second question is no, you need to sit back and take a break from those expenses, at least for a few weeks. By now, most of you all might have this question in your head. Afterall, what is the right way to spend money, and still be happy?
Spend on experiences
It is normal for us to spend money on things that aren’t necessary for our survival. But, is it good? Is it worth it? If you are spending money on experiences that are going to give you a lifetime of memories to cherish, then definitely yes! Buying materialistic things such as clothes, gadgets, etc., might give you satisfaction for a while, until they get worn out. Experiences on the other hand, even though might seem a little expensive, gives you life-long happiness, rather than just being satisfactory at the moment. With the help of EarlySalary, you don’t have to worry about the expenditure. You can now pay all your bills and cover all the last minute-payments with the help of EarlySalary’s products. You can get instant cash loans up to Rs 5,00,000 for a tenure of up to 24 months. It comes with zero prepayment charge and you will get your loan amount transferred directly to your bank account.
Invest in time
In your busy lives, you might find it hard to make time for your leisure or have fun with your closed ones. Apart from your job, smaller things such as running errands for the home, cooking, etc. could consume a lot of time of your day. Instead, you can make use of delivery services to get your food, groceries, and other supplies delivered. There is no doubt you would be spending a little more money than how much you would have spent if you had done it by yourself. At the end of the day, you will be successful in buying yourself some quality time, so why not?
Invest in others
You could use your extra money in gifting something to someone, helping out a stranger facing some trouble, or even donating it to a charity or NGO. Although spending money on yourself is more tempting, several studies have proven that you are more likely to not regret spending money on someone else. Even research shows that giving away a little might also boost your mood. This might not apply to everybody. This is something somebody should do out of interest, and not because of any external force.
The Fulfillment Curve
The figure shown above is called The Fulfillment Curve. It depicts the level of happiness that comes along with more and more money. The curve consists of four parts. Let us look at each one of them in brief.
This simply means, you barely have money to buy necessities and even a little amount of money is going to bring in a lot of happiness. You will be much happier just by availing your basic needs such as food, clothes, and shelter.
Once you start making enough money for basic necessities, you will start investing money on your comforts such as sofas, bed, extra pillows, second or third pair of jeans, etc. These purchases too, bring you immense joy and happiness as you get the satisfaction of making more than necessities. This section of the curve is still considered to be positive, where money is still bringing you happiness. At this point, you will start towards becoming rich.
Eventually, your comfort expenditure starts to expand. From buying one chair, to two or three extra chairs, from a small house to a bigger one, and probably ten extra pairs of jeans. These aren’t comforts anymore, they are luxuries. They make you so happy, that you will end up wanting more and more, eventually pushing yourself to the peak.
Now that you are rich and you have reached the peak, you will start buying unwanted things and invest your money that might hardly give you any happiness. You uncontrollably start spending on things that are going to be a burden for you. The money which was once enough to buy you comforts and even luxuries, and make you happy, will push you further and further towards stress, in order to earn more money. If this goes on, it will be a never ending cycle, and you will end up with zero happiness with all the money that you’ve earned.The best section of the fulfillment curve is either the comfort or the luxuries section where you know you have enough. It is extremely important to know that you have enough money that would be sufficient to bring in happiness.
When will you know you have enough money?
When your spending and your happiness is equally balanced, and when all your necessities are fulfilled, that is when you know you have enough money to be happy. It is better to have enough money, than to be rich, that would eventually push you towards an unhappy life. You will feel content when you have enough, which is not too little, or not too much.Well, there is no simple answer to what ‘enough’ is. It’s a fairly subjective concept, after all. It is upto your realization, when you reach the luxuries section in the fulfillment curve, that you have enough money.Take time to analyse your income, your expenditure and what your ideal ‘enough ’would be. Work towards it, and never, ever, push it further ‘enough’.