Living below your means

We sacrifice too much in pursuit of financial success, Hamm argues. Sometimes more money means more problems.

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    In this April 2010 file photo, a man walks past a collage of copies of Chinese RMB, U.S. dollar and other foreign bills at a money exchange store in Hong Kong. Hamm writes of his experience chasing wealth at the expense of everything else he valued in his life.
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Jennifer writes in:

I really appreciate the articles you write on frugality. My husband and I are very glad to have simple jobs that we can just walk away from at the end of the day without stress. We don’t make a ton of money, but we have everything we need and we don’t have the stressful situations that many of your readers encounter. More money equals more problems.

If you actually look into research on the topic, making more than $25,000 a year barely makes you any happier at all. A jump from $25K to $55K in annual salary matches with only a 9% increase in happiness. Beyond that, once you get to $75K and above, happiness actually starts to decline with more income.

This matches almost exactly what Jennifer is saying. However, I don’t fully agree with the idea that more money equals more problems. Instead, I’d argue that the quest for more money at the expense of other aspects of life equals more problems.

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Step back and ask yourself what you have to sacrifice to make a six figure salary. For most people, building a career where they earn a high salary involves quite a lot of sacrifice, mostly in the form of time and energy.

I saw this in my own life. I missed my oldest son’s first steps because I was away at a work conference. I remember calling my children on the phone and hearing my son ask when daddy was going to be home again. I remember weekends where I was unable to spend time wih guests because there was some career-related task that was absolutely urgent and had to be resolved.

There were many evenings when I would come home and all I would have the energy to do is kick back on the couch and either play a video game or watch television for a few hours. I remember many mornings where I’d tell myself that I was going to do something worthwhile that evening, but when I would arrive home from work, I was just too drained to do it.

When I started The Simple Dollar, it got worse. Most of late 2006 to mid 2008 is a blur to me, because I spent that time giving everything I had to what amounted to two full time jobs (and more).

I was making a good deal of money at the time, but I was sacrificing almost everything else I valued in my life to earn that money.

My relationship with my kids was damaged. My relationship with my wife was damaged. My circle of friends shrunk significantly. Most of my hobbies withered on the vine. I was sick very regularly.

Those costs weren’t due to having money. They were due to the effort put into acquiring it.

It wasn’t worth it.

I would far rather have a career that didn’t damage important aspects of my life and paid poorly than a career that paid me well but ran me through the ringer.

“Why not just stop?” It seems like an easy way out of the situation, doesn’t it? The problem is that many people, once they start earning a significant salary, make financial choices that lock them into that salary. They get under a giant mortgage, multiple car loans, student loans, and credit card debt. They value their perception of success in the community and they can’t or won’t let go of it.

It’s not a matter of more money bringing more problems. It’s the chasing of more money – and the bad choices that chase sometimes leads to – that brings about the problems.

The solution? Live below your means. Don’t be the person who is bleeding to get by in a rich neighborhood. Be in a less affluent neighborhood and be secure with your bank account. Don’t be the person who has to have the new everything. Instead, enjoy having things that you enjoy and have time to enjoy.

Less money, less problems.

The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on

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