Are You Wealthy, Successful, And Miserable?
Every once in a while I read an article that touches on so many points relevant to financial independence that it must be shared. Charles Duhigg’s recent article in New York Times magazine titled “Wealthy, Successful, and Miserable” is one of those articles.
Duhigg, a Harvard Business School graduate, details how he was shocked to discover how miserable his former classmates were at his 15-year reunion.
He writes:
They complained about jobs that were unfulfilling, tedious or just plain bad. One classmate described having to invest $5 million a day — which didn’t sound terrible, until he explained that if he put only $4 million to work on Monday, he had to scramble to place $6 million on Tuesday, and his co-workers were constantly undermining one another in search of the next promotion. It was insanely stressful work, done among people he didn’t particularly like. He earned about $1.2 million a year and hated going to the office.
The revealing part about the guy that makes $1.2 million a year is that when he considered a job change that would pay half as much (only $600,000 per year!), his lifestyle made the pay cut impossible. “My wife laughed when I told her about it,” he said.
A lifestyle that $600,000 per year cannot fund is something I can’t wrap my head around. But I don’t watch TV and have always avoided following celebrity culture etc. It’s like another planet to me.
The lesson here is one that you’ve probably read before. Most studies show that up to a certain amount more money doesn’t increase happiness or job satisfaction. This Purdue study says “We found that the ideal income point is $95,000 for life evaluation and $60,000 to $75,000 for emotional well-being. Again, this amount is for individuals and would likely be higher for families.” Remember the median household income in America is now over $60,000 per year.
The other obvious lesson here is about lifestyle inflation. I shudder to think about the things and consumer trappings this person has in his life that he cannot afford to “fund it” on $600,000 per year. When you elevate your lifestyle so that it always costs what you make or more, you’ve locked yourself into a situation requiring you to continually earn your salary or more.
And humans are adaptive creatures. We easily adapt to the Corinthian leather seats in the $60,000 SUV and 5,000 square feet of house, empty rooms or not.
Downsizing is probably much harder than never inflating in the first place.
The financial independence strategy is to continue to strive to earn more, but to live well below that amount. And of course invest the difference, and watch it grow. Then one day you’ll have a huge safety net which will allow you to take risks and leave your job when it’s no longer fulfilling.
I’m sure that guy wishes he could do that. But he made his bed.
Job Satisfaction
Duhigg then goes on to show data about declining job satisfaction in America. The reasons?
Oppressive hours, political infighting, increased competition sparked by globalization, an “always-on culture” bred by the internet — but also something that’s hard for these professionals to put their finger on, an underlying sense that their work isn’t worth the grueling effort they’re putting into it.
That last point is a big one – the work isn’t worth it. I’ve written about bullshit jobs before. I’ve also written about having a job where your work is connected to the mission, and where the mission means something to you.
Selling widgets may seem a meaningless and empty life to some, but meaningful to others. When you have some connection to the meaning of your work, you’ll be your happiest in a job. That’s not a mind blowing revelation but one that many of us ignore in the pursuit of a higher salary.
The example Duhigg uses in the article about hospital cleaning staff workers speaks volumes. Some of those workers found ways to turn a job cleaning bedpans into something with meaning. To me that’s amazing and admirable, and shows a level of stoic mindset and humbleness I doubt I could achieve.
Yet the investment banker in the article who moves millions of dollars around everyday only sees his job as playing with numbers on a screen. He’s not able to find meaning in his work by realizing he’s helping people’s pensions grow. And those growing pensions are helping them realize their retirement dreams.
That’s a lofty mission if you ask me, but he can’t make the connection. I can only imagine how hard it must be, given the environment he works in and the disconnectedness of his daily activities to that end state.
Happiness & Enough
At the end of the article Duhigg writes:
“I’m jealous of everyone who had the balls to do something that made them happy,” my $1.2 million friend told me. “It seemed like too big a risk for me to take when we were at school.”
So like me, he’s jealous of Evelyn Stevens and those like her. I can commiserate with him, it was too big of a risk for me too.
If anything this article highlights the America we’re living in today, one with riches and comforts never seen before for more people than ever, isn’t moving the dial on happiness.
When is enough enough?
Super article – and a good example of how we trap ourselves in our lifestyles.
We are our own worst enemies!
So true…
You are so right about the fact that once you get accustomed to a certain way, it is hard to lower that lifestyle. Your mind and body adapt quickly and the “downgrade” is often a very hard pill to swallow.
That’s why the hedonic treadmill is so dangerous and physicians find themselves in similar situations to this investment banker.
Downgrading a lifestyle is probably way harder than inflating…
>>Downgrading a lifestyle is probably way harder than inflating…
Sometimes, but speaking from experience, once my wife and I experienced trying to maintain a 4000 square foot home, we decided long term, we’re definitely not staying in this size house forever. Even with it paid for, if something breaks, you generally have 5x everything to fix instead of 1 or 2 (for example it’s got 2 water heaters instead of 1, 4 bathrooms instead of 2, etc). And of course keeping it clean is a lot of work, too. I realize this falls under the heading of “rich people problems”, but it’s real, and we’re looking forward to downsizing.
I can see an overbearing house being easier to downgrade from if you don’t have it filled with expensive toys
here’s my odd example of finding meaning in work. one time when i got bounced out of my lab job onto the factory floor i was pretty cheesed off to have to do a job beneath my qualifications. i found something out, though, and that was happiness in serving. it wasn’t for the company of the shareholders for sure, but for the other people on the line. i didn’t want to let them down up or down the line so i make sure i did a good job. if i screwed up it could cause a bad day for a bunch of nice people and you don’t want to be THAT guy.
i was in chemistry school with a bunch of future doctors who had huge family and societal pressure and expectations on them even at age 20. that was a time when my low family expectations were a great gift in comparison. easy breezy is the way.
Ha, low expectations for the win! I think my parents had the same for me
Isn’t it great not feeling trapped in a $1.2 mil/year job? Seriously, it’s quite freeing. Enough is a personal decision and probably changes for everyone over time, but when you find it it’s very calming.
That one word – enough – is so complex. Calming indeed.
Jeez, that’s crazy. Unfortunately, a lot of people are stuck like that. Some people can’t image spending less than $100,000 per year. That’s already a lot of money to me. $1.2 million is an insane amount of money.
I agree with you. It’s best to avoid inflating in the beginning. It’s really tough to go back.
$100,000 a year seems crazy to me, even the year I spent $40k on an Antarctica trip I only spent $75k the whole year.
$600,000 as too little. Wow. The mind boggles.
But yes, I think it’s about finding a way to keep your job from making you miserable. I work in customer support, which means my job could easily make me miserable. I can’t say that I’ve found a lofty mission in helping people in what I do, but I do at least focus on the fact that 98% of our customers are totally cordial to downright polite and pleasant. Only about 1.5% are unpleasant and just 0.5% are nasty. So when the nasty ones — who threaten my overall stomach for the job — come around, I just remind myself of all the nice customers we have and that I’ll soon be back to them, and then I can keep going.
That’s a tough job to do, kudos to you. I’ve actually had two good experiences recently with credit card and healthcare customer service. One was so friendly we chatted for like 10 minutes after the call was done!
When people ask what I disliked most about living in NYC and why I ultimately left, I always say, “I felt people valued the wrong things there.” This blog post and the original article are exactly what I’m referring to when I give this answer, though most people fail to understand my explanation. It could be a case that I just don’t share those values, but I would certainly prefer to have a healthy and happy husband instead of another manicure, house in the Hamptons, second nanny, $50k per year kindergarten, or more overpriced designer clothes. And, yes, that’s exactly the lifestyle that man in the article can not escape. I heard about and witnessed that lifestyle during my years and it always baffled me, but that is life for a certain segment of the population in NYC. But NYC is very much a race for the dollar and it’s why money is so important if you want any sort of quality of life there. Jeez, I don’t miss that place!
I love your example about the hospital cleaning staff. We had one woman on our cleaning staff who always said she was every bit as important as the physician. You know what? She’s right. I told her and the other cleaning staff that their role is vital to the success of patient care. Without them, patient safety would be compromised and infection rates would skyrocket. They have every right to be proud of their roles and the work they perform each and every day.
Nice post!
Katie – I’m not here to defend the spending of someone making so much money in NYC. But sometimes a million dollar income isn’t as great as people envision it to be purely at the face of it.
I’ve written a blog detailing the budget of a family with a $1,000,000 income.
$1,000,000 household income budget in NYC
While it is a great consumption lifestyle, it isn’t close to being extravagant as one might think.
Hi Sport of Money, Thank you for sharing your detailed blog post! It’s really interesting to see what’s left over after taxes and where that income is going. The housing costs are not surprising in the least, nor is the food, though I don’t think it’s necessary to spend to $15 per day on lunch or to Uber every day to work. Of course, I know many people at a certain income level refuse to set foot on a subway platform, but if Keanu Reeves isn’t above it with his obscene wealth…
Regardless, $262k is a substantial amount of discretionary income, even if it’s spread over education, vacations, entertainment, etc. It’s substantially more than a middle income family earns. But how that money is spent reflects a bit of lifestyle creep, doesn’t it? A middle income family in NYC (and most other regions) can’t afford an elite private school for their kids and will accept a public school (I’ve worked with many medical students and residents who are graduates of those public schools, including one today). They also can’t afford to spend $50k on vacation per year. Nor can they afford a car (or daily Uber rides), unless it’s a less expensive model and an actual necessity. While I understand that $1 million in NYC (or the Bay area, etc.) may not result in an ultra-luxurious, living-like-Jamie-Dimon lifestyle, it’s certainly not lacking. It boils down to choices for everyone.
This isn’t an attack on you, but I know plenty of NYC families who manage to live on far less. That said, I know it takes a substantial income to live a life most Americans would find comfortable.
The key word there is “extravagant”, which is really subjective and in the eye of the beholder.
I agree the key word is “extravagant,” but I think there’s also a mindset that’s very specific to NYC and the pressure to live a certain lifestyle. There’s a similar one in many other areas in the US, but not to the degree I have witnessed in NYC. And I think Chelsea Brennan touches upon it in this podcast that I’m listening to right now. She’s a former hedge funder and discusses her lifestyle choices and habits versus those of her former colleagues in NYC.
I’d like to try NYC for one year to see if I could hack it. I don’t think I’d be able to….
Charles also mentioned another item in his article which I thought was also interesting. He said the ones who did not immediately succeed after Harvard Business School (rejected from Google, management consulting or top tier financial services firms) are the ones who needed to perform an introspective to figure out what they truly want earlier in life. Subsequently, they are able to find jobs which are more fulfilling and can lead to greater happiness.
I guess this can be one silver lining in failure. It can also be a detriment of having success come too easily (like lottery winners not appreciating the value of their winnings).
Great point, instead of chasing the ‘template’ their education provides they found happiness elsewhere. The peer pressure must be intense though
The $1.2m friend needs a slap (metaphorically speaking) to come to his senses. If the family can’t survive on $600k a year something has gone horribly wrong. The finances are clearly structured incorrectly if he can’t afford to take job which pays vastly more than the average salary (and in fact is comfortably within in the top 1% of annual salaries in the US). Don’t get me wrong, trying to find decent assets to invest $5m a day sounds stressful job but it sounds like he’s compounding the stress by structuring his finances in such a precarious way. Pardon my French but that sounds like a b***s*** life. Cut down on the FATT (food, accommodation, transport and taxes) and then the need for such a high salary (and the stress associated with it) might evaporate.
As for the late bloomers, isn’t that just survivorship bias? Those that didn’t get the fancy jobs on graduation but still managed to become ‘successful’ in the eyes of their peers would most likely have needed to be even more impressive than the fancy job employees to attain that status. Little is said about those living ‘relatively normal, basically content lives’, although query whether being a Pulitzer Prize-winner and multiple NYT best-selling author is normal….(I’ll accept the point that the ‘relatively’ caveat is there for a reason). Nothing is said about the people, if any, who never rose above mediocre careers or failed to make much of their lives at all (then again, I posit that such people are unlikely to want to parade their lives at an alumni event in the first place).
HH
I love the FATT acronym, good stuff!
As to your last point, I think you’re correct that those folks don’t give a rats ass about status etc. That’s a good trait to have.
Thanks for sharing! I could suck it up for a year to make 1.2 million.
I noticed you double space after your periods. My wife keeps making fun of me for doing that and is trying to get me to stop! I keep telling her I learned that in like the 3rd grade and there is no going back.
I was taught double space after sentences and the Oxford comma and I’ll die on those hills!
I think that guy needs to read some Accidental FIRE to get a reality check on how much he really needs to fund a lifestyle 😉
I need to get him in a frugal click-funnel
I had to smile at your last line. I once wrote a post titled “When Is Enough…Enough”. Amazing minds. Sad how many people struggle to find true happiness in life, and often it’s because they’ve never identified their “enough”. Great post.
I remember your post… thanks for the kudos!
Man… $1.2million per year. That’s a lot of money. He must live like a king. I can understand how a salary like that would be hard to give up. He bet lives a really big lifestyle, and his ego is likely wrapped up in the status that job brings too.
I highly doubt someone like that could ever be happy earning sub- $100k/year like the rest of us lowlifes. So hard as to be impossible.
Egos can become inflated just as easily as spending. 😉
But he’s also a slave to his stuff. His stuff owns him. To me that’s the furthest from a ‘king’ you can get.
And if I’m a lowlife, I’m a content one who isn’t owned by stuff 🙂
$1.2 million ain’t much,… if you’re living in one of those places with a high “Economic Vitality” Index. 😉
Ha!
Clap Clap Clap! Bravo on this one, Mate! I’m starting to feel like the miserable army more and more each day. Too much BS and manufactured pressure for my tastes (and fragile stress threshold.)
I’m feeding off these kinds of posts more and more as I try to figure out my life outside of the corporate green zone.
Sounds like the promotion might not be going so well. I found the further I moved up the more I disliked my job.
Glad you liked the post
Awesome read. I was constantly miserable working in investment banking, but the pay was good. It was a battle everyday. I’m glad I’ve now been able to move on to happier days!
Awesome!
All I can say is we’re all different and we have choices. If people would only stop complaining, they will live a happier life as simple as that.
Amen to that!
Its as if you described my neighbors. $2mil house, expensive cars, 2-3 kids in expensive private schools, six week summer vacations. We all have to decide when enough is enough
They obviously haven’t reached it yet…
I always come back to the concept of “enough” and it seems to resonate through all aspects of life. When is enough, enough? We live in a time of excessive surplus and waste and yet happiness seems to be hard to come by. I always need to remind myself that time spent creating a surplus of happiness is the most important investment anyone can make.
“excessive surplus and waste” describes America well. I see people whining on social media above how bad things are, they’ve obviously never been to Afghanistan or El Salvador. I have. They have no friggin clue.
For me, it’s all about time for my son, my wife, and my hobbies. My profession is coding, and I am happier coding at home, than I am at the office. The fact is that the w-2 supports it all, but I realized some time ago, that it would never be what I always wanted to do. Meaning for me is the people in it, and the things I do outside the office. I’m just doing that as long, and working as hard, as I need to to keep it all going. Time will tell with the rest.
Time will tell indeed. No reason you shouldn’t be able to code from home!
Uh, I actually knew Evelyn Stevens. She started in my racing club. She had something you and Duhigg probably don’t — incredible power, specific athletic talent that instantly revealed itself, international-level talent. She literally rode away from everyone in major races. So following that kind of talent vs staying in finance was probably an easier decision for her than you guys. 🙂 Plus I believe she had some savings, and it was a short-term detour: she was young and could go back to what she was doing later, especially as her story was going to provide her a lot of capitol with finance types, who are all into cycling now.
Very cool! I guess at that level you have to have a lot of natural talent and she no doubt had it. A guy who rides in my club actually raced with Greg Lemond as teenagers in the 1970’s. He said the same thing – same age, but they were in totally different universes.
You are correct though, to have that much talent makes it easier to choose because your chances of success are way higher.
Lastly, you are correct again, I do not have incredible power 🙁
But I try real hard.