Why do so many of us, if we come into money like a big lottery win, mismanage it so badly? How many stories have you heard about the people who win huge sums of money and not only are miserable a year later but have lost nearly all of it?
First of all, you have to look at the human organism after the way it's evolved for the last million or more years into its current form. The reason we're so successful as a species is our adaptability to new environments and circumstances.
Our nervous system and emotional response to our surroudings and what's going on in our lives works extremely quickly - the reason we were able to survive when an ice age descended 100,000 years ago is the same mechanism as the reason it's so easy to get bored in today's world.
That means that when we suddenly get money, we get used to it a lot quicker than we think we will. Most of us spend all our lives dreaming of suddenly coming into wealth and being delivered from the constant grind about how we're going to pay our bills. We imagine that if/when it happens our lives will be changed forever and will turn into a constant parade of joy, a honeymoon period that never ends.
In fact, we're built to get used to it at a speed that's almost scary considering how long most of us spend wishing for it - in fact a matter of only months. After that, and just like our ancestors had done a few months into an ice age, we've reset our sense of normal and reached emotional equilibrium again like we're designed to - instead of struggling and worrying about money being our normal state, having enough money to do whatever we want is now our normal state. Problems don't go away, we now just have the problems that come with having lots of money (and they exist, in spades).
We do indeed go through a honeymoon period where we pay off our house (or buy another one), get rid of all our debts and go on an opulent holiday with all the trimmings, help our friends and family and everything else we've always dreamed of. But that feeling of joyous deliverance doesn't last any longer than it takes our nervous system to recalbirate to expect it.
In fact that's where the stories you've heard about how miserable lottery winners become comes from – after family, friends and hangers-on descend and resentment erupts over who gets money and who doesn't, many people say they were better off before having any.
The next thing is that I think the amount of time we feel like that depends on the kind of person we are. If we put particular emphasis on money in our lives it can be an even emptier achievement, the sense of joy and deliverance being even shorter.
We've spent all the time leading up to the change in circumstances believeing money itself will change our lives, but in believing that we've just bought into an outsized version of the buyer's remorse we all know to some degree, thinking buying things will make us happy.
The version of that when we get rich is only the momentary achievement of a self-imposed milestone, and we're no sooner there than we uncosnciously set our goal higher, ending up with the curious phenomenon of people with so much money they never have to work again if they don't want still feeling pressure to keep up with the Joneses and buy even more houses, an even more expensive car, a longer boat, etc.
You might have heard about one of two studies. In the first, researchers asked a sample of people how much money they'd need to be completely happy and satisfied with their lives, and the response was the same - twice as much as they currently earned. The kicker is that it didn't matter whether the respondents earned $20,000 or $20,000,000 a year, what they had was never enough.
In the other, scientists measured annual income against levels of life satisfaction and the magic tipping point was $70,000. Under that, income affected happiness in the form of stress because of financial worries, but above it, multimillionaires were no happier overall than those on $70,000 a year.
If you look at money the right way the honeymoon period can last longer, and you can even turn it into something more permanenet and meaningful over the long term. If you understand it's a means to an end and that it won't make you happy in and of itself, you're in a better position – we all learn very quickly that money can only buy so much and that very little of what it can buy will truly fulfil us.
Humans are by nature achievement machines. We evolved under the constant need to find the next meal and the next place of shelter. The modern equivalent of that is things like career advancement, winning at sport, etc. Take that away from the human animal by giving us everything we've always dreamed about and completely eliminating scarcity from life and you take away our reason to get out of bed in the morning, hobbling our most innate drives and leaving us moribund.
But if you use money as a tool to do what you should always be doing in your life - invest in relationships with people and with helping and serving your fellow man – it will remain what it should have been in all our lives (if the capitalist system was fair instead of being an all-consuming source of worry for so many people) - part of a vast toolset to live rather than a reason to live.
It's no wonder we all dream of being rich, but just like advertising and the consumerism it promotes, if we're not emotionally prepared for it, we're going to be taken in by it and left hollow and disappointed if we ever get it.
