Being wealthy does not equate to the easy life

Most people strive to become financially stable to the point of spending all their time on leisure activities. Money paves the way for such a lifestyle… freedom — from work, money worries, household chores and screaming kids. Free to veg out, watching a large-screen plasma TV or playing golf all day. 

According to research by Daniel Kahneman, the Nobel Prize-winning behavioral economist, quoted in an article in the Washington Post, “being wealthy is often a powerful predictor that people spend less time doing pleasurable things and more time doing compulsory things and feeling stressed.”

People who make less than $20,000 a year… spend more than a third of their time in passive leisure—watching television, for example. Those making more than $100,000 spent less than one-fifth of their time in this way—putting their legs up and relaxing. Rich people spent much more time commuting and engaging in activities that were required as opposed to optional. The richest people spent nearly twice as much time as the poorest people in leisure activities that were active, structured and often stressful—shopping, child care and exercise.

It turns out that wealth is a predictor (i.e., not necessarily a cause or effect) that people will spend less time on passive leisure activities (such as watching TV).  

A few things to note from the study:

• Poor was anyone making <$20,000
• Even though the wealthy spend more time with stressful activities, they report being happier in general (though not by as much as one would expect).
• Past the point of poverty, one’s happiness stays relatively stable throughout the $30,000 – $100,000+ income range.
• Increases in income are expected to raise well-being by raising consumption opportunities but these material possessions only offer short term pleasure
• People’s aspirations adapt to their possibilities (people always want more).
• There is a weak relation between income and global life satisfaction.

There are several holes in the study but in general, people with above-average income are relatively satisfied with their lives but are barely happier than others in moment-to-moment experience, they also tend to be more tense, and do not spend more time in particularly enjoyable activities (though I argue that active leisure is extremely pleasurable and I don’t find watching TV that pleasurable).

I say all one has to take from this study is to focus less on income and live life to the fullest (whatever your definition of fullest is). Here’s a little tip though, no one achieves goals by sitting around a television set.

The entire journal article can be found here.

Gas Prices in the US

It’s quite easy to complain about the drastic increase in gas prices. Looking at straight facts, the US remains a cheap location to fill up. Out of 155 countries surveyed, U.S. gas prices were the 45th cheapest, according to a recent study from AIRINC, a research firm that tracks cost of living data. The data below shows the findings from the firm.

Most expensive places to buy gas

Rank	Country	Price/gal
1.	Bosnia-Herzegovina	$10.86
2.	Eritrea	$9.58
3.	Norway	$8.73
4.	United Kingdom	$8.38
5.	Netherlands	$8.37
6.	Monaco	$8.31
7.	Iceland	$8.28
8.	Belgium	$8.22
9.	France	$8.07
10.	Germany	$7.86
111.	United States	$3.45

Cheapest Oil Prices

Rank	Country	Price/gal
1.	Venezuela	12 cents
2.	Iran	40 cents
3.	Saudi Arabia	45 cents
4.	Libya	50 cents
5.	Swaziland	54 cents
6.	Qatar	73 cents
7.	Bahrain	81 cents
8.	Egypt	89 cents
9.	Kuwait	90 cents
10.	Seychelles	98 cents
45.	United States	$3.48

Hidden data not strictly in the numbers above is what each government does with extra revenue received from gas taxes. For example, most of the European countries (with astronomical gas prices) use the revenue from taxes to fund improvements in public transportation. These improvements along with the high price of gas breeds a culture content with using public transportation for all needs.

The former EXTREMELY low price of gasoline in the US led to the purchases of automobiles into virtually every household. On a per capita basis, Americans use three times more oil than Europeans. With the recent increase in prices, people feel the crunch but remain committed in their love affair with cars.

Americans must accept the consequences of overconsumption and learn to adapt. Improvements will come with slight changes to our way of life. Making concerted efforts to reduce gasoline consumption by walking, carpooling, and using public transportation can reduce the price of gas, help the environment, and increase fitness. Accept responsibility, make some changes and let’s improve our world.

Keys to Financial Security

My previous posts dealt with running and my inability to stop smoking. The focal point of this post will be finances, I will lay insight into my financial situation and how I deal with it.

With marriage, buying a house, and one day starting a family being future goals, achieving financial security often lingers at the back of my head. Anyone knows the initial steps to attain financial security involves becoming debt free. Luckily my parents aided me in never getting into debt.

The next step would be to put some money away as savings. The frugality my parents demonstrated directly influenced my spending habits. With a somewhat modest 30K salary, I have been able to save up quite a large sum of money, well above an average 25 year old (I think).

Still I have much to learn in order to truly be financially savvy. Books have enlightened me into recently opening a Roth IRA (for retirement) and to start investing. Luckily my girlfriend comes from a similar financial background hence making decisions together easy. Hopefully our dreams will become reality in the near future.

I apologize if this post comes off as cocky, I have been feeling somewhat down and this provides a way for me to forget my shortcoming.

4/16/08 – 4.6 miles in 43:51 seconds