Wealth is more than valuable possessions & money
Wealth… what a beautiful word, don’t you agree? It rolls off the tongue and gives us a sense of satisfaction as it’s heavily associated with happiness (think, Scrooge McDuck taking a swim amongst his gold coins). For many of us, wealth is the target of our being, at least in a financial sense. Oxford defines wealth as “an abundance of valuable possessions or money.” Although I agree this is a good, straight forward definition - I ask you not to take it at face value and look within yourself for the true, deeper meaning.
Wealth is not directly equivalent to valuable possessions
Most people like nice things - a beautiful home on the water with a private dock, luxury vehicles, well engineered watches, high quality diamonds, custom tailored clothing - the list goes on. Do these items directly represent wealth? On the surface, potentially - though, maybe not if we dig a bit deeper. Why do we want these things? Is it for societal status or is it because we value the way they make us feel? I believe the latter and here is why.
Take the beautiful home on the water…
It’s early morning, the sun is rising and you walk outside, towards the water. You sit on your adirondack chair and take in the scene, closing your eyes to enter a meditative state. You focus on your breathing while taking note of the sounds of nature around you. Birds flying above, maybe a fish jumping out of the water. You are able to relax and be totally present. 15 minutes later, you return to the “real” world and its challenges - though, you are better equipped to not only manage your own tasks, but also positively support the people around you.
Now, you can argue the end state described above is attainable without the home on the water and I don’t disagree. Though, it is still an example how the valuable possession itself doesn’t equal wealth. Rather, wealth is the way the home makes you feel.
Wealth does not directly equal money, either
The second half of Oxford’s definition is wealth = money. This, I believe, is also true at a high level. Though, again, I prefer to look further. What kind of freedom or opportunities does money allow for?
Let’s say you want to take a vacation and at the same time it is your parent’s 50th wedding anniversary as well as your mother-in-law’s 60th birthday. Wouldn’t it be nice to take a group trip to Europe (mother in law has never left the US and elderly parents can no longer travel alone). Money allows you the ability to do this.
Going a step further, the joy of the trip really comes from the smiling faces around the dinner table after a long day of sightseeing. The stories that are shared amongst yourselves and the local Italians next to you. The waiter jumps in - there is an inside joke that emerges from the way your mother-in-law quietly orders panna cotta for dessert. This is a memory with loved ones. Yes, we have pictures to look back on, but it is difficult to replace the emotion and satisfaction stemming from this exact moment. Money allowed for this to happen. As a result, your bank account balance (money) does not equal wealth. Instead, the accumulation of these types of memories does.
How to accumulate real (intangible) wealth
First, it’s important to uncover what’s most important to you. What makes you happy and embodies your core values and beliefs? One way to do this is to have an open conversation with someone you trust - maybe a partner or an expert. This is where a Financial Planner can support you. We ask the right questions to stir emotion and discover these ideals.
Next, create a plan that aligns your core principles with financial goals. Our objective is obtaining wealth both now and in the future. We can do this through balance and moderation - spending money on things that make you happy now and not feeling guilty about it, since we have a secure strategy in place for the future. A great approach to solving this challenge is Reverse Budgeting - something we implement at Benzina.
Conclusion: Wealth = Emotions and Memories
Oxford is not wrong (I would never start a debate with the folks that practically invented the dictionary). Though, I prefer to dig deep in all aspects of life - including (unsurprisingly) the definition of wealth. On the surface, wealth is easily described as valuable possessions and money. Looking below the tip of the iceberg, it is actually how the valuable possessions make us feel and the byproducts of money (memories), that paints the full picture of true wealth.
Our personal example of wealth - trip to Italy with parents and in-laws (right before the dinner).