“The world is not driven by greed. It’s driven by envy.”
This recent quote by Charlie Munger caught my attention. If you haven’t heard of Charlie Munger, he is Warren Buffett’s partner at Berkshire Hathaway. Munger was born in 1924 and has been an investor and observer through almost every imaginable economic cycle. He says that over his lifetime, the standard of living adjusted for inflation is more than five times what it was 100 years ago in the United States and most of the developed world. Some experts have estimated the standard of living is as high as 15 times what it used to be.
Advances in medicine, technology and transportation, to name a few, have made our daily lives almost unrecognizable from what they were just 100 years ago. In general, our lifestyle is materially better in nearly every imaginable way, but somehow, we are less happy. It defies reasonable logic. Create a better, safer and more lucrative environment, and we should be happier … right? Actually, wrong!
Researchers have confirmed in study after study that happiness hasn’t budged and, in most cases, is moving backward. It turns out that much of our happiness or misery is not a result of our lifestyle but from how we perceive that lifestyle stacking up against our peers. It gets even worse as people grow more successful and who they consider peers changes. Wealthier friends mean even less perceived wealth.
Morgan Housel is the author of “Psychology of Money.” In the book, he writes, “If expectations rise with results, there is no logic in striving for more because you’ll feel the same after putting in extra effort.” I think Housel is on to something. One reason our expectations rise is that who we compare ourselves to changes over time.
The concept of envy is so deeply hardwired into our society that most of us don’t even notice its subtlety as it silently steals our joy. Many of us are raising children that will be the first generation to grow up in a social media world. Many of us can remember the world before social media, but they do not have that luxury. If envy is hardwired into who we are, social media is gasoline on the fire.
In the 2019 World Happiness Report, researchers John Helliwell, Richard Layard and Jeffrey Sachs studied the impact on happiness as screen time increases. This study measured 8th and 10th graders from 2006 to 2017; regardless of age, the implications were clear for everyone.
Screentime’s rise and sleep’s decline mean we get little break from checking in on how great everyone else’s life seems to be going. We are comparing our reality to everyone else’s highlight reel, which makes envy’s grip on our lives a 24/7 ordeal.
Source: Helliwell, J., Layard, R., & Sachs, J. (2019). World Happiness Report 2019, New York: Sustainable Development Solutions Network.
We hope this article causes you to pause and reconsider your level of joy and happiness. Every once in a while, it is worth stopping to look around with a new lens. Whether we are in a bull market or bear market, in a booming economy or recession, our American lives would have been a dream world for our great-grandparents. We can choose gratitude and choose to figure out the people, places and things that bring us joy and let the Joneses worry about the Joneses.
Thanks to Charlie Munger for the reminder!
Can LiveWell Capital help you get your financial house in order so you can enjoy your life to the fullest? Contact Ben Beshear and his team at livewellcapital@nm.com or visit them online at livewellcapital.com to learn more.