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IF YOU’RE A HISTORY buff, you know how difficult life was during the 1930s. In our modern American world of plenty, it can be hard to appreciate what life was like during that period. The Great Depression, as it was later dubbed, was a time of incredible strife and struggle.
Today, we have an unemployment rate of less than 4%. During the 1930s, it reached 25% in the U.S. Think about that. A quarter of the country was looking for work to feed their family, and couldn’t find any. Even those who could afford goods were faced with shortages of things like gas, sugar, fish, butter, eggs, cheese and meat. There was even a shortage of leather, causing people to ration shoes for their children. Can you imagine? I struggle to.
Learning about history is a great way to gain the perspective we so desperately need in our world of plenty. By some measures, people today are more unhappy than they were back then. Yet all of us, from the top 10% of income earners to the bottom 10%, are exponentially better off than we would been at earlier times in human history. We have come miles in almost every category that defines an affluent, civil society: human rights, shelter, poverty, starvation, clean water, heat, air conditioning, education, work conditions, employment rights. The list goes on and on.
Why then, if everything has gotten so much better, are people chronically unhappy? I have a theory. It comes down to a simple idea: Comparison is the thief of joy. We aren’t satisfied with having more when someone else has even more. We judge and grade our lives in comparison to our peers or, worse, celebrities. One thing is certain: Someone will always have more than we do.
One stimulant to our feelings of inadequacy may be social media. We see an endless stream of often carefully curated, meticulously edited and finely filtered posts from peers and from the rich and famous. Each post is created with the intent to illustrate an illusion of perfection. I don’t mean to claim that social media is inherently bad. It can be a great way to connect across the world. But when we use social media as the measuring stick for our life, we get a distorted view of reality that can lead to unhealthy comparisons. We might be tempted to ask, “Everyone looks so happy all the time. What’s wrong with me?”
Another reason we might feel that things are worse than they are: the current state of the news. Bad news sells, plus it spreads twice as fast as good news. You won’t see a headline tomorrow that reads, “Global Poverty Down Again for the 20th Decade in a Row.” I don’t mean to claim that following the news is bad. It can, however, cause us to become convinced that life is getting worse—when, by almost every measure, it’s getting objectively better all the time for most of the world. No, not perfect. But yes, better.
When it comes to finances, this game of comparison can cause us mental anguish, with feelings that we’re behind, or inadequate, or inferior. It can cause us to forget that our quality of life is so incredible, right here and right now. Worse even than the mental aspect, the comparison game can cause us to act irrationally. We may be attracted to dangerous investments we don’t understand because our neighbor purportedly got rich owning it. Berkshire Hathaway Vice Chairman Charlie Munger said it best at a recent meeting with his business partner, Warren Buffett: “The world is not driven by greed, it’s driven by envy.”
The grass is green where you water it. Gratitude is an antidote to envy. Keep that in mind when comparison tries to steal your joy.
Luke Smith is a CFP® professional and practicing financial planner. He creates customized financial plans for each family he works with around the country. Luke pursued financial planning to combine his two favorite passions: finance and people. He spends his free time with his wife Heather and their family in Maryland. Outside of work, Luke enjoys the outdoors, golf, reading and writing. You can reach him at Luke.Smith@Wealthspire.com. Check out Luke’s earlier articles.
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I laugh when I hear so many people lamenting the “good old days”. I keep , just as a reminder , many items from decades ago, that used to belong to my grandparents. I have gasoline rationing stamps, a radio that is about three feet tall and two feet wide , it must weigh about fifty pounds. It is nothing more than a radio.
Years ago, no Social Security or unemployment insurance. OSHA, the FDA and welfare were non-existent. World travel is done in a fraction of the time as compared to years ago, prior to air travel.
Smart phones, online bill payments, investing costs virtually zero, automobiles, much better medical services, and so many more. we truly have it made.
In Colorado it’s snowing at the moment. Some hate it!
My oldest son and wife sent a picture of their two hands holding cups of hot cocoa, looking out the window. Aaaaa yes, life is good!
Alas, I fear the sources of deep unhappiness among broad swaths of the most recent generations have far more to do with the culture and society than material conditions. Specifically, deep confusion about what makes life worth living.
This is a personal finance site so I’ll say no more, but I think the thesis as stated has a big hole in it.