How much money do you need to be happy? In other words, can financial stability bring happiness?
Bestselling author of The Five Secrets You Must Discover Before You Die, Dr. John Izzo and Doug explore what happiness really is and the underlying question, “Does money make a person happier?”
Dr. Izzo spoke to 250 people with 18,000 years of cumulative life experience and found one thing in common: your internal mindset about how you see money impacts your happiness more than the dollar amount in your bank account.
Listen to his research that shows if financial stability really brings happiness.
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Whichever way you choose to handle your money, make sure you and your spouse agree on it!
If you would like a little more insight on including your spouse in portfolio planning, watch this video.
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Watch Does Financial Stability Bring Happiness? on YouTube.Read the Transcript
Interview with John Izzo
What is the secret of happiness? How do you have a long and fulfilling life? Is it by having $1 million in your account? John Izzo shares the secrets of having true happiness.
Douglas Goldstein: I’m very excited to have on The Goldstein on Gelt Show, bestselling author John Izzo.
John, I understand that The Five Secrets You Must Discover Before You Dieis basedon a seriesof some of the most amazing interviews ever conducted in the world, second only to the one interview that I’m conducting with you right now, here on The Goldstein on Gelt Show.
Tell me, why is that book is considered so amazing?
John Izzo: I’ve always been fascinated with the lives of older people, who could look back on their lives and tell us what they learned.
A number of years ago, I asked people to nominate the one older person who had found true happiness and had something to teach us, almost like who’s the wisest older person you know.
After getting 2,000 nominations, I interviewed 250 people with 18,000 years of life experience, from 60 to 106, with only that one thing in common.
Someone said, “Hey, this is the happiest older person I know,” and, “Man, what a journey to learn from them, what they wish they had known sooner, and what they learned about life.”
Douglas Goldstein: Since this is a personal finance show, I simply have to ask, these 250 people with 18,000 years of life experience, were they statistically wealthier?
By wealthier, I mean did they have more money than the next 250 people you might have chosen.
Is Money the Key to Happiness?
John Izzo: What I discovered is something very similar to the research you would know and support, which is that if you’re really struggling to make a living day in and day out, and your finances are poor, and you’re worrying where the next money is coming from, it’s hard to be happy.
But beyond that, I found they were people who lived quite simply and modestly, and they were extremely happy, and some who were quite wealthy managed to live extremely happily.
It was more about your internal mindset and how you saw money, and how you saw your life. But they all said, “Look, if you’re really struggling paycheck to paycheck, finances do matter,” and that mirrors the research as well.
Douglas Goldstein: So these were people who, for whatever reason, were very happy, and had all obviously achieved a basic sense of financial security. Once they had cleared that hurdle, it didn’t necessarily matter how wealthy they were.
Do you think you can extrapolate some wisdom from this, like when people are struggling to save for retirement, let’s say?
Maybe I’m guilty of causing people a lot of angst because I talk a lot about saving for retirement.
So they probably say, “Well, Doug Goldstein says I’ve got to save,” and they put so much emphasis on this that maybe they forget to be happy. Oh my God! Wow, I feel guilty. Should I feel bad that I’m pushing people to do this?
Having the Right Perspective on Wealth
John Izzo: No, no. I think the key is having a perspective on things. I remember one man I interviewed told me a wonderful story about his father, who had achieved a fair amount of financial success.
But he said, “When he was dying, at the end of his life, what I noticed was in the final days and weeks of his life, he didn’t talk about his money or all the possessions he had at all. He talked about the experiences he had, and the pictures of vacations and trips he took often that he paid for to go with his family. He talked about relationships and the people he loved.”
He made the point that it’s not that possessions are bad or good when it comes to happiness, but it’s more how we use them.
I would say to people, make sure you use your money for things that truly add value or happiness to your life.
Make sure you use it to give to people that you care about and for things that you care about. So many of these people said, “Happiness comes from giving, happiness comes from loving relationships, and having experiences that are meaningful to you.”
I think so many people accumulate money without thinking about, “What am I accumulating it for?” and so I think that’s one of the things I learned from interviewing these people.
Douglas Goldstein: The question that I wanted to know the answer to is, is it important to have a lot of money in order to be happy? John has been pointing out that you need to have a basic amount to cover expenses, but then it’s not clear that having a lot more money necessarily makes you more happy. Are there any other connections you can make to money and the secrets that people must know before they die?
Having the Right Balance toward Money and Your Future
John Izzo: A couple of things really strike me. One is that many people spend so much of their life worrying about money.
One of the interesting things I learned from the people I interviewed is the importance of staying in the moment, in your life.
I think about the difference between doing good planning and letting worry over future finances ruin your life. Many of these people said, “Look, all you can do is in the present moment. Do whatever you can to create the future that you want,” but worrying about it won’t help you. It will just rob you of your happiness.
I think that with regard to all the people that I know who have means, who spend so much time worrying about, “What if I lose it? What if there’s a stock market crash?” Just this idea of staying in the moment and not letting that worry about future finances can rob you of your happiness.
And one can extrapolate worry about future health, worry about all these things that might happen one day, instead of being in the moment, knowing that when these things happen, you’re probably going to handle it.
I think that’s one thing I learned.
The other thing, I think, is almost no one regretted their failures. That was one of the most fascinating things I discovered in these interviews.
People tended to regret the risks they didn’t take, much more than the risks they did take that didn’t work out.
Here, I’m not so much talking about taking risks with your finances per se, but I think it’s often that someone might have a choice between risking an investment that might bring them some varieties of happiness and wealth vs. just playing it safe.
One of the things I discovered is that most people didn’t regret the failures they felt were well-intentioned, but they did regret often not going for the things they wanted.
Douglas Goldstein: All right, I have to be very frank with you, John. I was very excited to have you on the show, and now I’m absolutely regretting it because you are saying all the opposite of what I say.
You are telling people, “Don’t worry about the future. Live in the moment,” and I’m telling people, “Plan for the future, save money, put it aside.”
The one difference I can hear on what we’re saying is you’re saying, “Don’t worry about the future.” I don’t want people to worry either, but I do want them to plan, I want them to focus on it. Help me out here. Maybe I’m just wrong. Maybe I’m looking at it in the wrong way, but I feel like we’re really on opposite of the scale here.
You Can’t Control Everything That Happens in Your Life
John Izzo: It’s a perfect question. I’m a real planner in my own life, for my finances and my financial future, and I think you hit the nail on the head.
It’s not, not to plan, stay in the moment, and to hell with tomorrow. It’s being in the moment and not letting worry about the future rob you of your present happiness.
It’s almost realizing that there’s some things I can control in my life and things that I can’t. I’m sure when you’re asking people about managing their money, for example, everyone says, “When is the next market crash?” and of course, we can’t control that.
All we can do is stay in the present and stay with that plan that we have in many ways.
I think that that’s more what people were saying. It’s not, “Don’t think about the future.” It’s “Plan for the future, but make sure that you don’t let the worry about tomorrow rob today of its present happiness.”
Douglas Goldstein: Okay, but let’s be realistic here. A day in my life looks like, I come into my office, a couple comes in - they’re in their 50s. Let’s say the husband suffers from overconfidence and the wife suffers from worrying all the time.
I say, “Listen, it looks like we have to put a percentage of your portfolio in the stock market, even though there’s no guarantee. You might lose money,” and then I can see the wife gets pale and the husband says, “No, that’s of course what we have to do.”
Now I have to tell them, “Don’t worry because statistically, it’s going to be okay.” I can show them all the charts and graphs, but how do you get someone not to worry?
Becoming a Master of Your Own Thought Patterns
John Izzo: You have to become a master of your own thought patterns. The other thing I discovered in these interviews is that happy people master the inner life, and I think here’s where there’s a lot of parallel with managing your finances.
My financial planner, who is brilliant, as I’m sure you are, in my country, always says, “My job is mostly to manage your inner life because the secrets of investment are not really that complicated, but you’ve got to do it.”
I think, in some ways, the keys to happiness are the same as the keys you are probably trying to teach your clients, which is, they have to manage the inner game that gets in the way of them managing their finances properly. That’s where I think there’s a lot of parallels between happiness and managing your money.
It’s more of managing the inner game. Once you do that, you have a much better chance of managing the outer game.
Douglas Goldstein: Yes, I bet that’s true. I’m trying to think of some of the wealthiest people I know, and you can even start with a guy like Warren Buffett.
I watch him from time to time, and he doesn’t look like he’s the worrying sort.
John, I want people to be able to learn more about what you are talking about. How can people follow you and follow your work?
How to Follow John Izzo
John Izzo: Yes, they can follow me on Twitter @DrJohnIzzo, find me on LinkedIn as well, or go to our website www.drjohnizzo.com and find out all about the books and the things that we do, and we’d love to stay connected.
I love the work that you are doing. Keep it up, and again, plan for the future, but don’t let the worry rob you of your happiness.
Douglas Goldstein: All right, that’s a great place to leave it. Dr. John Izzo, thanks so much for taking the time.
John Izzo: Thank you.