Your Happiness Portfolio : Part 1

Money Can Buy Happiness: How to Spend to Get the Life You Want
by MP Dunleavey

You Can Afford To Be Happy

MP Dunleavey, personal finance columnist for the New York Times and creator of the award-winning "Women in Red" column on MSN Money, presents a radical new plan for attaining happiness - and it doesn't involve taking money out of the equation. The secret to true and lasting contentment is learning how to spend your cash.

Don't just spend on-invest in yourself!

Learn how to use your money to buy:

• More Time
• Less Stuff
• Better Health
• Stronger Relationships
• Greater Confidence
• Rewarding Hobbies
• Life-enhancing Skills
• Financial Security
• Peace of Mind

How many times have you been told money can't buy happiness?

It's time to abandon this old chestnut because money is a powerful tool, which can in fact buy you all of the things you never thought it could: peace of mind, a healthier lifestyle, more time to do the things you love, stronger relationships, security, and loads of fun. In a world where we're bombarded with the temptations of conspicuous consumption, personal finance columnist MP Dunleavey presents an antidote to empty spending. Through quizzes, worksheets, real life examples, and sound financial advice, MP shows you how to stop throwing your money away on fleeting pleasures like the hot new designer handbag, or the biggest house on the block, and start investing in your own portfolio of happiness. Reallocating your assets to reflect what really satisfies you is the way to enjoy a life of true wealth. Money Can Buy Happiness is for anyone who believes finishing happy is more important than finishing rich.

Chapter 1

There is a gigantic difference between earning a great deal of money and being rich.

- Marlene Dietrich

For centuries, economists based their theories on the premise that man was a "rational actor" who could be counted on to make economic decisions in his own best interests at all times. (I know, I laughed when I learned that, too.)

As anyone who has put an overpriced vacation on Visa-or spent part of their rent money on clothes-can attest, neither man nor woman is terribly rational when it comes to making economic decisions. You know what you want-yet you go ahead and spend your money on something else. Just look at all the data on retirement: Repeated surveys have found that people aren't saving enough for retirement; moreover, people know that they aren't saving enough for retirement. Yet what are people most worried about? Not having enough money in retirement!

These inconsistencies don't affect just how well we plan ahead; they seem to be a flaw in the way human beings were designed to think and act financially. That's why it's important to be aware of your own mixed impulses as you think about using your money to make you happier. Let's do a short, fun exercise so you can see what I mean regarding some of your own quality-of-life choices thus far.

Exercise: The Cost of Living

This exercise works like the old "Mad Libs," but it's a little more free-form. Just fill in the blanks with adjectives, verbs, nouns, whatever. Add words where you need to, improvise if you feel like it- have fun, be honest, and see what emerges. Time required: About two minutes, if that.

1. I earn a living by ____ ; I consider my job to be ____.

2. My dream job or career would be ____.

3. My home is ____ and a realtor would describe the location as ____ and ____.

4. After work I usually ____ and ____.

5. On the weekend I typically ____ and ____.

6. The top three things I spend money on are ____, ____, and ____.

7. I'd describe my friends as ____; when we see each other we usually ____.

8. My family is ____ and I sometimes wish I could ____.

9. The main things that keep me up at night are ____.

10. The three areas where my time is most committed are ____, ____, and ____.

11. My spiritual life consists of ____ and I feel ____ about that.

12. Sometimes I feel like my life is missing ____.

13. When I have a free hour or two, I usually ____ or ____.

14. My last vacation was ____ and it was ____.

15. If I could change three things about my life, they would be ____ ,____ , and ____.

16.When I'm eighty, I hope to look back on a life that was ____.

Ideally, this exercise should make you feel somewhat surprised or even uncomfortable. Or it might provoke a moment of clarity. When my husband did a test run of this exercise for me, he put down his pen and said, "Well, I've just figured out that I hate my job." He knew that already, but these questions do have a way of giving you a fly- on-the-wall perspective so you can see how various lifestyle choices interconnect-and whether those choices are in sync with what's most important or valuable to you.

What's money? A man is a success if he gets up in the morning and goes to bed at night and in between does what he wants to do. -Bob Dylan

Now, as you begin to think like a happiness investor, here are some questions to ask yourself (you don't have to write anything down here, but do take a couple of minutes to consider your answers):

• What surprised you about some of the answers you gave?

• Did you notice any discrepancies between where your resources go and what you find most satisfying in life?

• What are some ways that you're using your money, time, or energy that yield the biggest payoff in terms of your own happiness?

• What are some of the ways you're using your money, time, or energy for paltry gains?

• If you could change one thing this week, maybe even today, that might be a better investment in your own happiness, what would it be?

Life Is Rich: Invest Wisely

It may seem strange to equate your personal well-being with an investment portfolio, but it's a pretty useful metaphor. It reminds you, the stockholder, that you have a fair amount of control over where you invest and why. And just as every financial investor has very different stakes in his or her portfolio, it's the same with happiness. Savvy money managers may know to put a certain amount of capital into something solid like bonds, blue chip stocks, or large- cap mutual funds, but the precise investments they choose are up to each individual. Likewise, how you decide to balance your assets in order to enhance your own happiness is ultimately up to you.

After all, how people define happiness is an extremely subjective matter, not to say downright idiosyncratic at times. It's pretty amazing to imagine the myriad types of joy, pleasure, contentment, and elation each person can have-even within a single day:

• There's the deliciousness of your first sip of coffee in the morning ...
• the thrill of overcoming a challenge...
• the bliss of lying in the sun...
• the physical rush of exercise...
• the peace you feel while watching a child sleep ...
• the fun of fall-off-your-chair laughter with friends ...
• the satisfaction of doing your best ...
• the joy when you hold someone you love ...
• the tingly relief of a shower after a sweaty workout ...
• the excitement when you've landed a new job ...
• the ordinary happiness of knowing, thank God, it's Friday.

You could add dozens of items to this list, and so could I, but the bigger question is: How do you decide which type of happiness to invest in? Are some better investments than others?

Yes, as it turns out, some are. Eons of human experience plus quite a bit of research have left a fairly thick trail of bread crumbs that show where the path to happiness lies. And as your official happiness adviser, those are the stocks that I'm going to recommend you put at the heart of your portfolio. I've outlined them below and will explore them in detail in the coming chapters.

Asset #1: Your Valuable Time

People talk about how much time they spend doing this or that, but how often do you think about the "spending" part of the equation? Yet how you spend or save or waste your time has just as much of an impact on your quality of life as the way you choose to spend your cash. Chapter 3 is about the trade-offs you can make to reclaim your time-and invest in a happier life.

Copyright © 2007 by MP Dunleavey

About the Author

MP Dunleavey is a personal finance columnist for the New York Times and creator of the popular "Women in Red" series for the MSN Money Web site. She lives in upstate New York with her husband, son, two cats, and more house repairs than she bargained for. But is she happy? You bet.