02/14/2009

As tax season descends upon us and I spend my weekends gathering all of the documentation and cranking through the forms to create the mystical and all-powerful 1040, I can’t help but reflect on my financial state.

I started wondering– as most people do from time to time– what it would be like to have so much stinkin’ money that I wouldn’t need to worry about anything. Whatever I wanted I could have, and I could shower my friends and family with lavish gifts. A bit more thought refined that wish to something a little more realistic:

How much money would be enough but not necessarily too much?

In other words, how much would it take for me to meet all of my needs and a good portion of my wants? What kind of salary would that be? Would I want enough to:

  • Eat out every day?
  • Go to see every movie in the theater instead of waiting to rent it on DVD?
  • Buy a nice new car every year?
  • Pay off my house?
  • The list goes on, of course, and at some point I think I would cross the line (perhaps subconsciously) into extravagant excess. I drive a 1995 Saturn SC2 and love it. Even if I had the cash today, I don’t think I’d buy another car. Yes, someday this piece of rattling plastic will give up the ghost, and then I’ll get something else. But it’ll probably be used, and it’ll probably be something unassuming like a Honda, rather than a late-model BMW. So in that way, maybe I already have the salary I need.

    I remember my first job– when I was a lad of fifteen– working at a fireworks stand. As I recall, the job lasted about three weeks, and I made something like $400. To a fifteen-year-old, that was more money than I knew what to do with. I was rich! The world was my oyster!

    I probably blew it on cassette tapes and books.

    Then I remember graduating from college and moving to Colorado where I started my first “real” job. After five years in school, when scraping together five bucks to order a pizza on Friday night was the extent of my financial planning, it was amazing to have a salary. Again, I felt like I was the king of the world, basking in wealth.

    I bought a new 32″ television and a VCR.

    Fast forward to today, where I make a comfortable salary but still feel like I need more. After all, I have a family! And a mortgage! And Laralee always wants to buy organic free-range no-preservative chicken meat! There are always things sucking up the money, leaving me wondering where the paycheck went, and why we can’t seem to dump anything into our savings.

    Money is a funny thing. We never seem to have enough, but even more interesting is what happens when we compare our wealth with those around us. “I wonder if he makes more than me?” is a common thought in the corporate world. I’m reminded of a story of capuchin monkeys, which goes something like this:

    There were scientists doing some experiments on capuchin monkeys, in which the monkeys were taught to navigate a maze and receive a cucumber as a reward at the end. The monkeys were perfectly happy to do this, and learned the maze well. They were excited to get their cucumbers.

    Then the scientists built another maze beside the first one, and taught a different group of capuchins to run that maze. Their prize was a handful of grapes.

    When the first group saw this, they became enraged. They refused to run the maze, and those who did took their cucumbers and threw them at the researchers.

    The lesson is that the monkeys were content with what they had until they saw that others had something better. We might laugh at the little guys, but in many ways we’re exactly like them. I might be perfectly content making a salary of $50,000 a year until I find out that Bob, in the next cubicle, makes $60,000. Suddenly my salary seems inadequate, and I find myself resenting Bob and thinking how much better I do my job than he does his.

    Similarly, I might feel smug and satisfied making $30,000 a year if I know Bob is only making $25,000. It makes me feel more valuable, more respected, and like I’m somehow more important than him.

    As these sorts of thoughts run through my head while I consider my finances and calculate my taxes, I think it boils down to a couple of conclusions.

    First, it’s a bad idea to compare yourself with others in terms of salary. There are so many ways to measure the “worth” of a person, and the money each of us make is certainly a poor yardstick. Teachers and nurses make much less than web developers, but I would argue they are far more important in the world.

    And second, as I look at my income and compare it with my expenses, I need to keep in mind that in the end I really do have what I need. Sure, I could always use more, but all in all I have it pretty darn good. I should be grateful for it.

    More to the point, I am grateful for it.