There are many definitions of wealth.
Some people equate wealth to your income level.
Others assume having a lot of stuff must mean you’re wealthy.
Still others believe there is a specific number followed by a few zeroes and some commas that define wealth.
Your financial situation is some combination of math and emotions so a rich life means different things to different people.
I’ve written plenty about levels of wealth as it pertains to dollar amounts to here are some other forms of wealth that go beyond the size of your portfolio or bank account:
Knowing how much you need to be happy. My older brother moved to Chicago when he graduated college. From my vantage point as a broke college student, the fact that he had an apartment in the city (with a roommate no less) seemed like a life of luxury.
I asked him about his salary to try to understand what it took to make it in a big city.
He told me it was enough money to live in a half-decent apartment in Chicago, go out with friends a few times a week and take a nice vacation once a year.
I liked that answer because while he wasn’t making a ton of money in his first job, it was enough to live comfortably at that stage of his life.
Not checking your 401k balance all the time. John Bogle had a great take on this in an interview:
This [not peaking at your statements] is one of the most important rules of investing. If you never peek from the age of 20 to the age of 70, you’ll rip that first 401(k) statement open at age 70, and I recommend you have a doctor on hand because you’ll go into a dead faint. Your heart might even stop. You’re going to have an amount of money you can’t even imagine.
I don’t have the will to never check my balance but probably only look once a year. As long as you’re saving and have a long enough time horizon the less you check the better.
The more you look the higher the odds of seeing a loss.
Taking a week-long vacation away from work. I enjoy my job. I like the people and clients I work with. I still think it’s important to shut things down on occasion to relax (if it’s a vacation) or just get away (if it’s a family trip).1
I don’t care how much you make — it isn’t worth it if you never get to enjoy it.
Use an iPhone without a protective case. I will never feel wealthy enough to do this. Like walking into public naked.
Not caring what other people think about you. One of the weird parts about getting older is in some ways you feel like exactly the same person but in other ways you are completely different.
In my teens and 20s I probably cared way too much about what others thought of me.
Now I see what wasted energy that is. I think having kids helps. You lose the ability to be embarrassed when you have little kids and paying so much attention to them allows you to stop worrying so much about yourself.
Having a short commute to work. There was a survey that said 35% of workers would take a pay cut in exchange for a shorter commute.
At my first job out of college I had to commute an hour there and an hour home, basically all highway driving. It was soul-sucking.
My office now is a 5-minute drive from home with no time spent on the highway. It’s lovely. I cannot imagine ever going back to a long commute to work.
Not fighting with your significant other about money. There are plenty of things in life to stress about. If money is a big point of contention in a relationship, that makes everything else even worse.
Being on the same page as your partner when it comes to spending and saving can save you a lot of headaches.
Being healthy enough to enjoy yourself. Building health is a lot harder than building wealth because you can automate your investments to deter bad behavior.
You can’t automate your diet and workout schedule. You have to show up and put in the work by making smart choices on a regular basis.
I am one of those weird people that gets an endorphin rush or whatever it’s called from working out. I actually feel better and happier after I work out. It’s my form of meditation and stress relief.
And just like no one teaches you how to manage your personal finances or save for retirement, you’re on your own when it comes to living a healthy lifestyle.
But it pays huge dividends if you can figure it out.
Health is a form of wealth because it gives you more time and more energy to do things with the people you love.
The 3 Levels of Wealth
1The difference between a family trip and a vacation is the kids, of course.