Paul Sullivan of the New York Times had an excellent article this week that concerns how people really think about finances and the impact they can have on our lives. In the piece he talks to Barnaby Riedel, a researcher who’s been trying to figure out how money and investments fit into a person’s overall financial picture and affect their happiness.

The results of his work shed some light on the things that really make a difference in most people’s lives:

By assigning certain codes to their answers, he was able to come up with four categories that better captured the stages of a person’s financial existence — working, spending, saving and investing.

“The traditional model says a financial life is about saving and investing, but when people talk about their financial lives they talk about working and spending,” he said. “It accounted for 90 percent of what we heard. Working and spending provide the drama of our lives.”

This is why I said earlier this week that personal finances are far more important than portfolio management. But the focus on your career is something I didn’t touch on and it’s a big one because it can be such a huge component of the level of happiness or unhappiness with your life.

Late last year, Chief Investment Officer ran a profile on the long-running success of Notre Dame’s endowment fund performance that’s been achieved because of CIO Scott Malpass. Malpass isn’t a household name, but he’s highly respected in the institutional investment community. His dedication to his alma-mater and investment process is admirable, but the conclusion to the article is what I found interesting from a personal standpoint:

From the age of 26 onwards, Malpass has dedicated himself wholly to the institution. As a consequence, he never married or had children. College campuses teem with romantic possibilities for students (although pity the soul caught canoodling in an opposite sex dorm after hours). But for single employees, these towns offer notoriously small dating pools. Malpass instead dotes on his nieces and nephews, and has mentored legions of young investors throughout their careers. One also gets the sense that—unlike so many ultra-dedicated financiers— Malpass couldn’t stand siring a family only to make guest appearances between business trips.

 “I wake up thinking about what I need to do as CIO,” he says. “That’s what I enjoy doing. I’ve given my life to this institution, and my blood is in the brick.”

There are people in the industry that would kill to be in the same position as Malpass, managing billions of dollars in a job that he’s passionate about. But most people don’t take into consideration the sacrifices Malpass has made to dedicate his life to his career. I’m in no position to judge the man if that’s what makes him happy, but I think this underscores the importance of work decisions on your life.

And career decisions aren’t just about money as Riedel discovered in his research:

“The big ‘aha!’ moment for us was that a financial life really isn’t about money,” Mr. Riedel said. “It’s about people struggling to be the best version of themselves, to live a life they can feel proud to have led. Sometimes that involves making a hard decision to make less money.”

Finding that best version of yourself is the goal, but it can be very difficult to get to that place and no two people are the same.

There are some people that define themselves by their job title or the amount of money they make. Others are more interested in the Frank Underwood dream of power over all else.

Some people are drawn to big cities where they might make more money on an absolute basis, but have a much higher cost of living. Others take less money to work in a smaller city, but have a much lower cost of living.

Some people focus exclusively on cutting back to save as much money as possible. Others are more interested in advancing their career to earn more money so they can both spend and save more.

Some people thrive in a cutthroat, competitive work environment where it’s kill or be-killed. Others are happy if they simply work with people they like and respect.

Some people can’t function if they’re not doing something work-related 24/7 and bringing their job home with them every night. Others are happy punch in at nine, punch out at five, and keep their work and personal lives separate (which is becoming nearly impossible these days with smartphones).

Like most things in life, there’s no perfect answer with these types of choices and decisions. Life is full of trade-offs. There are certain people who have figured out how to manage their time and create that work-life balance that is so elusive to others. Some people spend their entire working years searching for their passion while others fall into their dream job by chance.

My daughter has her first birthday next month (which is mind-boggling to me – part of me never wants her to grow up). It’s amazing how having her in my life has put these types of decisions into perspective for me personally. I am very ambitious on the career-front and have spent an inordinate amount of time trying to learn and improve myself. But I also recognize that all of the successes in the world wouldn’t mean that much without my wife and daughter there to share them with me.

I’m of the view that prioritizing is one of the most important aspects of creating a balance between your personal and financial lives. It also happens to be one of the hardest things to get right.

Financial Advisers Seek to Inject a More Human Element (NY Times)
The Malpass Model (Chief Investment Officer)

Further Reading:
What Constitutes a Rich Life?
What’s Your Tolerance For Complexity?


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  1. innerscorecard commented on Mar 21

    Great post. Just as I don’t want to be forced to live the life that others want, I would never want to force anyone else to live the way I want (which happens to be the pursuit of financial independence). It’s lucky that my spouse and I agree and sort of independently discovered some shared philosophical tenets, and thus can work together towards a common goal.

    • Ben commented on Mar 21

      I agree. There’s no one right way to make someone happy. Good point on finding someone that shares the same values as you. Agruing about finances constantly is no fun.

  2. Mark Zoril commented on Mar 22

    IMHO, your best post ever!

    • Ben commented on Mar 22

      Thanks Mark. I appreciate that.

  3. Tim O'Brien commented on Mar 24

    Ben, I agree wtih Mark- great post as usual. I subscribed to your blog several months ago and really enjoyed the blog and this post.

    • Ben commented on Mar 25

      Thanks Tim. Glad to have you on board. I appreciate the feedback.