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How do you know if you are wealthy or not?

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How Do You Know if You Are Wealthy or Not?

What makes someone wealthy? Is there some sort of definition somewhere which clearly defines who is wealthy and who isn’t? Traditionally, I believe that most people thought that in order to be considered wealthy you had to have a certain amount of money. Although it’s a moving target, $1 million seems to be the benchmark that most people would have in mind. If you are a millionaire, you are certainly wealthy right? The reality of life is that there is no clear definition for what makes you wealthy or successful and so it becomes open to interpretation. To be clearer, it becomes open to your own personal interpretation.

Throughout my years of experience in the wealth management industry, I have learned that people can have very different goals for how they want to live. I have seen many people who live on large amounts of income who aren’t as happy as others who live on more modest incomes. Without being too cliché, it’s become evident that having money is no guarantee of happiness, despite the fact that it provides more options for you to achieve your happiness. Given this, how can we define “having wealth” as only a measurement of how much money one has? In my mind that is a shortsighted and even lazy viewpoint because clearly you cannot be considered wealthy if you are not happy. Otherwise, what is the point?

Understanding What Wealth Is

I have regularly defined wealth as having the ability to do what you want, when you want, with who you want. In other words, you are wealthy when your understanding of what makes you happy is met by your ability to make it reality. In order to achieve wealth, you must first understand and find the things in life that make you happy and then work and plan towards having the ability to achieve them considering both financial needs and of course time. What might surprise most people, the most difficult determination in that equation is the first component, understanding what makes you happy.

Understanding What Makes You Happy

(Happy Lifestyle + Financial Ability + Time) = Wealth

As in most things in life, we spend too much time thinking about things that don’t actually get us to where we want to be. Most people spend a disproportionate amount of time thinking about what they are invested in, instead of thinking about why they are investing and how they actually want to use their money to add to their happiness. The importance of happiness is not just a priority for global health, as defined by the UN, it is a fundamental human goal from which all things even economic growth can benefit. So, what makes you happy? What are doing when you find yourself to be your happiest? Who are you doing those things with? These are all important questions and are worth while taking the time to consider and document.

Characteristics of Happy People

Here are some characteristics of “happy people” that you may also want to consider, but this is far from an exhaustive list:

  1. They get good sleep – This might be a bit chicken and egg, but it is difficult to be positive when you are constantly over tired. Happy people tend to make sleeping habits a priority. Note: This is not necessarily a recommendation to sleep more
  2. They resolve conflict – don’t you hate going to bed angry? Despite my wife’s best efforts some times, I try and make it a priority to resolve conflicts at home and in business constructively and with a positive outlook for everyone.
  3. They value time – People who don’t manage their time well are generally rushed and therefore stressed out. Making your time management a priority could be the biggest contributor to your day to day happiness and ensure you are prioritizing the things and people that make you happy.
  4. Participate in cultural activities – Getting out to experience a museum, a sporting event, or even a movie can boost your mood. A study that was conducted in Norway  found that people who participated more in cultural events were less likely to experience anxiety and depression. Make the things you enjoy doing in the community a priority.[i]
  5. Make it about more than just yourself – Volunteering your time in the community, gifting to your family or other people you care about, helping out people in need, these have all been found to increase an individual’s happiness. Prioritizing your community, your family and other people and causes you care about is something everyone should consider if they are going to achieve their own wealth.

Knowing that the definition of wealth is completely subjective, I believe that the wealth management industry needs to reframe what it means to be wealthy. Growing people’s assets is only one part of the equation and if we are going to truly accomplish what we are capable of, which is helping people to live happier lives, then we must consider all of the components that determine whether or not someone is truly wealthy. That’s how we truly help people to “find their wealth”.

[i] https://pubmed.ncbi.nlm.nih.gov/21609946/

-Grant White, CIM®, CFP®

Grant White is a Portfolio Manager/Investment Advisor at Endeavour Wealth Management with iA Private Wealth Inc, an award-winning office as recognized by the Carson Group. Together with his partners he provides comprehensive wealth management planning for business owners, professionals and individual families.

This information has been prepared by Grant White who is a Portfolio Manager for iA Private Wealth Inc. and does not necessarily reflect the opinion of iA Private Wealth. The information contained in this newsletter comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors. The Portfolio Manager can open accounts only in the provinces in which they are registered.

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