I’m working on a financial services brand, and so the whole business of “money” and “wealth” has been something I’m exploring with fresh eyes.
During my discovery I stumbled across the phrase “the hedonistic treadmill”, and it filled me with the dreaded realisation that this could be my life viz. the accumulation of stuff that just goes on and on and on and on, because there is never enough, with no end in sight.
In the movie The Social Network Sean Parker tells Mark Zuckerberg, “A million dollars isn’t cool. You know what’s cool? A billion dollars.” Oh how true this is. When I was a kid being a millionaire was a BIG deal. Today it’s nothing. Sure, I know there are things like inflation and CPI, but the point is that we are addicted to wanting more. And as we get more, and we up our standard of living and lifestyle expenses, it’s not long before we need more yet again. When it comes to money, having more money can be like a gateway drug to … well, wanting more money.
In a 2011 survey of millionaires by Fidelity Investments, 42% of millionaires reported not feeling wealthy. The respondents expressed fear that they would outlive their current assets. On average, the millionaires reported that in order to truly feel rich, and outlive their means, they would need to have least 7.5 million dollars.
Outliving your means is a relative thing really. It all boils down to spending more than you have, or not, whether you earn $50,000 a year or $1,000,000 a year. If $3.5 million [the average wealth of those surveyed millionaires] isn’t enough to get by, I’m going to guess that their lifestyle is a little more elaborate than mine.
Welcome to The Hedonistic Treadmill. As your discretionary income increases, so does your standard of living and your lifestyle. The result is that things once considered luxuries are now perceived as necessities. And this is how it plays out:
You buy a big house. You sit in your big house and say to yourself, “Great, I’m sitting in a big house”. And you invite your friends and neighbours over to visit your big house. “Look at my big house,” you think to yourself as they admire your big house, because it’s bigger than their house. And life in your big house is good … for about a year. After a year of living in your big house you get a little restless, and start to think, “I need a bigger house. I need a study and an extra bedroom. A bigger garden would be nice too. And a new car to match the big house. Then I’ll be truly satisfied and happy.”
In reality your happiness level will remain the same despite an increase in money [or in the size of your house]. The Australian Wellbeing Index explores this concept every year. They have found that beyond a certain income figure, happiness levels do not increase, but remain static. The cut-off point? $150,000. Though earning less than $150,000 a year is linked to lower happiness, people who earn more than that are no happier. Furthermore, people who earn way more than that start to experience lower levels of happiness once again. Like the millionaires club.
Investopedia explains it like this: “As a person makes more money, expectations and desires rise in tandem, which results in no permanent gain in satisfaction or happiness.” In other words, it’s a false illusion. A manufactured dream. A booby prize.
So there it is. Now I’m not saying don’t earn more money or buy a bigger house. I am saying don’t get trapped into thinking earning more money or buying a bigger house is the pinnacle of life success, and the key to everlasting happiness. Because if you do, you’re just like all the other rats furiously going nowhere on The Hedonistic Treadmill.
And never forget: You win the rat race, you’re still a rat.