How Much Money Would Make You Happy?

[UNEEK]

How Much Money Would Make You Happy?   By Joshua Kennon,

 

When It Comes to Your Portfolio, Science Has an Answer

 

As a new investor, you need to define what your goals are. What are your goals? Do you just want a comfortable retirement? Do you want to have your dream home with no debt? Do you want to own a private jet? The answer to those questions will determine the approach you might want to take when it comes to your investment portfolio.

 

I ask because contemporary sociologists such as Dennis Gilbert define "rich" as those who live off investments and not occupational-driven income. By this definition, a doctor, even one earning $1 million a year, isn’t as rich as someone who earned $1 million from stocks, bonds, real estate, copyrights, or other passive income sources.

 

The reason is because the investor can sit at home and make money, while the doctor stops receiving a paycheck if he fails to go into work.

 

Turns Out, Most Investors Don't Want to Be Rich

 

The truth is, most people don’t want to be rich. This was backed up in a major peer-reviewed study by Daniel Kahneman and Angus Deaton from the Center for Health and Well-being at Princeton University that proved money does buy happiness up to $75,000 per year.

 

 In other words, once you make $75,000 per year, your day-to-day experience doesn’t improve very much as your income grows. Your "life satisfaction" does – that is, how you feel about what you’ve accomplished. The degree to which you love your work is icing on the cake.

 

 It seems rational that most new investors should focus on how to earn that much each year, if they don’t already.

 

That means that a successful investing program is one that is designed to help you:

 

    Live debt-free. If you have no debt, you can’t go bankrupt.

 

    Avoid financial stress by having diversified, high-quality investments that provide you with the lifestyle you want.

 

    Maintain adequate insurance coverage so you don’t have to worry about losing everything if something goes wrong.

 

    Have diversified income sources so you don’t rely on a single job or source of income that could put your family at risk if it disappeared overnight.

 

The 4% Rule and Your Investments

 

The statistical rule for new investors is that if you withdraw 4% of your account value at the end of year each, you should be able to survive even another Great Depression. That means it would require a net worth of $1,875,000 to generate $75,000 in annual passive income without ever running out of money ($75,000 divided by 0.04 = $1,875,000).

 

That means that the average person, based upon research, needs a portfolio worth $1,875,000 to be happy without ever working again. How is that possible? Save $1,165 per month for 35 years at 8%. If you take advantage of 401(k) matching and other programs, you would only have to come up with a portion of that out of pocket.

 

Alternatively, if you and your spouse have an income of $50,000 per year, you’d only need $25,000 from passive income. Following the 4% rule, that would require $625,000. That would only require saving $303 per month for 35 years at 8%. Again, if you used 401(k) plans or other benefit programs, only a portion of that would have to come out of your own wallet.

 

The bottom line? If you are an middle-age or young, average American earning the median household income of $50,000 to $55,000 per year, your personal happiness is likely to tap out with a portfolio of $625,000 generating dividends of $25,000 per year on top of your salary, wages and benefits.

 

http://beginnersinvest.about.com/od/investing101/a/How-Much-Money-Would-Make-You-Happy.htm

 

[waterman13]

Infinity times Infinity!

I jest, money is debt, so I really don't care.

We really need to be focused on bringing down this system: "Mystery Babylon".

JMHO

WM13

[AirBorne]

I just want to be able to hire a full tine accountant to track all the money flowing in.

[DiveDeepSix]

_{My feelings on money are the same as on land.  I don't want all the land I just want all  the  land that borders mine, I don't want all the money I just want the money I don't have yet!!! ROFL      Thanks for the post Uneek!!}  

Edited July 15, 2013 by DiveDeepSix

[keepmwlknfny]

Im not greedy....i just want enough to be debt free and go on a long vacay.....

 

Is that too much to ask for?

[umbertino]

I'd feel comfortable with something between 1 and 1.5 Million Euros... I'm not that greedy.

 

A nice apartment here can cost about 750,000 Euros and up. So again I don't think I'm being greedy.

[sportfisher]

I am happy already 

 

but could be much happier if I was a debt free home owner, was able to buy my wife a new car, and fix the roof on our house.   

 

I would be really excited if there was enough for a new sportfishing boat 

 

To be comfortably retired with all the above, and able to spoil my family and friends would be the ultimate 

[eddiemac]

This much would make me happy, @ a one to one R.V. Please read below

Edited July 20, 2013 by eddiemac

[The Machine]

how much would I need ..... about 5  years ago I read a study stating someone at the age of 25 would need at least €3,000,000 to live the rest of there life without ever working, even at that they would only be able to be lower middle class.

 

personally I think I would be happy to retire right now with £1,000,000 ($1,650,000)

 

as far as this Dinar RV goes ..... I never got into this expecting to get rich just like the lottery ticket I buy every week .... if it happens , it happens . if it doesnt well I'll still have a good life, made some new friends and received an education in Middle east politics and economics.

I'd feel comfortable with something between 1 and 1.5 Million Euros... I'm not that greedy.

 

A nice apartment here can cost about 750,000 Euros and up. So again I don't think I'm being greedy.

 

I hear you buddy houses in my area go for £650,000 to £1,300,000   ($1,000,000 to $2,150,000)

 

I bought a new one last year on the lower end of that scale but would love to make the mortgage disappear

[securityguy]

My wife nailed it pretty good. She says all she wants is her own way.

[sportfisher]

My wife nailed it pretty good. She says all she wants is her own way.

take her to Burger King.

[umbertino]

how much would I need ..... about 5  years ago I read a study stating someone at the age of 25 would need at least €3,000,000 to live the rest of there life without ever working, even at that they would only be able to be lower middle class.

 

personally I think I would be happy to retire right now with £1,000,000 ($1,650,000)

 

as far as this Dinar RV goes ..... I never got into this expecting to get rich just like the lottery ticket I buy every week .... if it happens , it happens . if it doesnt well I'll still have a good life, made some new friends and received an education in Middle east politics and economics.

 

I hear you buddy houses in my area go for £650,000 to £1,300,000   ($1,000,000 to $2,150,000)

 

I bought a new one last year on the lower end of that scale but would love to make the mortgage disappear

Here in this Country people live mostly in apartments... One has to be generally rich or very rich to have a house... Or get it as inheritance.

 

Point being a single house is usually out of reach for most ( standard folks like myself).

[The Machine]

Here in this Country people live mostly in apartments... One has to be generally rich or very rich to have a house... Or get it as inheritance.

 

Point being a single house is usually out of reach for most ( standard folks like myself).

 

Its kind of the same here too .... but once your outside of the city it's all houses , the further out you go the more the price drops, unless its somewhere with spectacular scenery.

 

At the moment I'm only 5 -10 mins from the city centre ..... if I'd have moved 20 - 30 miles further out I could have saved myself £250,000 and got a lot more land but I really like where I am and it suits my life right now.

 

I will be moving further out in the future ..... I plan on buying a farm and just chilling in nature. but thats probably 10 to 15 years from now

[RodandStaff]

I was thinkin' about this myself as of late UNEEK... and if you don't mind, I wanna take a slightly different approach. 

 

Money- it can buy you some time to sit back and relax- but it can't buy you peace of mind.  It can buy you physical companionship and sex (if so inclined) but it can't buy you true love.  Money can buy you lots of "stuff"... but it can't necessarily buy you purpose and fulfillment.   

 

Imo...there is a void in each one of us that quite honestly can't be filled by just our own self serving interests or activities.  That void can only be filled when we put the needs of others first, when we do onto them like we would like done onto us.  To fulfill our purpose, or calling if you will...in this life... is to first realize we are not here just for ourselves, but for others as well... to walk hand in hand with them as we allow the Creator to point us in the right direction on this journey of "workin' it out" as we go.

 

Because of that... I see money as a tool only, not the end goal in and of itself.  Money can do some things... but will be hugely disappointing if I expect too much from it.  Life is a journey... and this journey does quite honest cost something as you go (a person's gotta eat, sleep, and live) but how much will bring personal fulfillment to each of us... has to be worked out individually imo, but overall I agree with the premise that the rate of return diminishes the more you put your trust in money to make you happy.  Just my perspective!        

[sandfly]

I DONT' WONT MY KIDS HAVE TO WORRIE LIKE I DID. LET ME ENJOY THE REST OF MY LIKE WITH MY KIDS. TAKEN THEM TO SCHOOL AND PICKEN THEM UP. ENJOY THE WEEKENDS WITH THEM. NOT TO MUCH TO ASK FOR

[UNEEK]

Rod thank  you for your contribution -  In terms of $$ I am not rich  (yet) - in terms of health and a few truly good friends I am wealthy. I think we all use a different scale to measure with  - maybe more importantly -- where  are we  and where do we want to be and what price are we willing to pay to get there?

I feel that most folks realize that  $$ money and fame do not guarantee happiness -  You can be very money wealthy and still be unhappy and you can be financially poor but wealthy in other areas and be happy - Just look at our  Hollywood stars - we have lost many wonderful gifted ones prematurely  due to  suicide or  unhealthy choices - Happiness is a choice - you  "choose" to be  regardless of what is going on - Rich & wealthy maybe a state of mind = also by choice -

Thanks for the  feedback folks - I just wanted to bring a little something different to read  and to stir our  minds - Have a great weekend with great hope & expectations for tomorrow  <3 <3 UNEEK

[umbertino]

Its kind of the same here too .... but once your outside of the city it's all houses , the further out you go the more the price drops, unless its somewhere with spectacular scenery.

 

At the moment I'm only 5 -10 mins from the city centre ..... if I'd have moved 20 - 30 miles further out I could have saved myself £250,000 and got a lot more land but I really like where I am and it suits my life right now.

 

I will be moving further out in the future ..... I plan on buying a farm and just chilling in nature. but thats probably 10 to 15 years from now

Same here as well... Granted the price of a single house is  generally high ( compared to an apt.)....It's certainly lower if you buy it in a small village lost somewhere where's there's no business or touristic interest... If you buy a house in a city  ( Rome, Milan, Florence, etc) it'll take Millions of Euros ( depends on the city area, how big house is etc. obviously).

 

The more far south in the Country you go, the cheaper prices get ( excluding super tourist areas like Capri, Taormina, etc.).

Edited July 20, 2013 by umbertino

[easyrider]

8- 10k  a month residual  would be ideal for me. Also understand i live in California, everything is expensive here and housing.I just want to stop renting and buy a new home and a new truck and invest properly.

 

2013 dodge ram sport lifted

 

 

Edited July 20, 2013 by easyrider

[umbertino]

take her to Burger King.

Ex wives literally ruined me ( financially).. I know...My bad....Lesson learned.....Hopefully.

 

Now I'd need a couple Million Euros to get back in shape and stay that way.

Edited July 20, 2013 by umbertino

[waterman13]

http://www.youtube.com/watch?v=cZh105_r2Qk

Ex wives literally ruined me ( financially).. I know...My bad....Lesson learned.....Hopefully.

I've had four, no more of that ....

WM13

[umbertino]

I was thinkin' about this myself as of late UNEEK... and if you don't mind, I wanna take a slightly different approach. 

 

Money- it can buy you some time to sit back and relax- but it can't buy you peace of mind.  It can buy you physical companionship and sex (if so inclined) but it can't buy you true love.  Money can buy you lots of "stuff"... but it can't necessarily buy you purpose and fulfillment.   

 

Imo...there is a void in each one of us that quite honestly can't be filled by just our own self serving interests or activities.  That void can only be filled when we put the needs of others first, when we do onto them like we would like done onto us.  To fulfill our purpose, or calling if you will...in this life... is to first realize we are not here just for ourselves, but for others as well... to walk hand in hand with them as we allow the Creator to point us in the right direction on this journey of "workin' it out" as we go.

 

Because of that... I see money as a tool only, not the end goal in and of itself.  Money can do some things... but will be hugely disappointing if I expect too much from it.  Life is a journey... and this journey does quite honest cost something as you go (a person's gotta eat, sleep, and live) but how much will bring personal fulfillment to each of us... has to be worked out individually imo, but overall I agree with the premise that the rate of return diminishes the more you put your trust in money to make you happy.  Just my perspective!        

I agree Rod.....Good points and sensible.

 

 Having said that.... Money is painfully useful and one realizes that esp. when they lack it bad.

http://www.youtube.com/watch?v=cZh105_r2Qk

I've had four, no more of that ....

WM13

Wow.

[FlintNPebbles]

8- 10k  a month residual  would be ideal for me. Also understand i live in California, everything is expensive here and housing.I just want to stop renting and buy a new home and a new truck and invest properly.

 

2013 dodge ram sport lifted

 

 

We just bought this truck...in deep cherry red! Love it. The seats are beyond comfortable and it rides and handles like a dream! But it's not lifted....4x4 factory standard and we added running 'boards'...or as I used to know them by Nerf bars.  Put some Rhino liner in and a cover on the box...it's very very nice

[easyrider]

We just bought this truck...in deep cherry red! Love it. The seats are beyond comfortable and it rides and handles like a dream! But it's not lifted....4x4 factory standard and we added running 'boards'...or as I used to know them by Nerf bars.  Put some Rhino liner in and a cover on the box...it's very very nice

Awesome. They look really nice love the new features they installed and has more of an agressive look to it. Also the new 2014 dodge ram 1500 comes with a V6 ecoboost twin turbo diesel it will be the best truck out on the market for fuel economy they are available at the end of 2013. The 2013 sport caught my eye in black with the sport hood looks badazz.

Edited July 20, 2013 by easyrider

[mrparrot]

If you don't think that money can buy happiness,

then you don't know where to shop...

 

All kidding aside,

one of my clients is the manager

of a local financial management company.

I asked him a question:

"If I brought you one million in

cash and said that I wanted to make

between 6 and 7 thousand a month,

could it be done relatively safe,

without too much risk?".

He said yes.

He then went on to say that the people

that really drive him nuts are the ones

who want to make over ten thousand

a month, without risk.

"Unless you have a crystal ball,

that's almost impossible.".

 

As for me, on a personal level, I like simple.

Don't need a big house.

The wife can keep the one

we have now.

I'll buy my own.

Don't need a fancy car.

Love my truck.

Don't want to take cruises.

The wife can go with her friends.

All I really want is an Olhausen

pool table, a new paint job on

my truck, a new computer,

and a second refrigerator for

my beer...

Edited July 20, 2013 by mrparrot

[millionaire in training]

I agree 100% with Rodandstaff.

 

But I must say that I do believe that money does buy you opptions.... Without a doubt.... Its important to have perspective on yourself and on your life.

 

Stay grounded and real but most off all always be humble. Dont ever loose that.

 

Money cant buy that......