The Secrets of Happy Billionaires: How to be Happy and Wealthy
Once you have enough money, can you be happy?
First, how much is enough?
A 2010 study concluded that money only improved happiness up until $75,000 in earnings, after that, more money didn’t make you happier. These conclusions were questioned, and the two battling researchers did a new joint follow-up study in 2022, that more money increases overall happiness up to $500,000 in earnings.
Why can more money make us happier? And why is there an upper limit to the money that can make you happy? Let’s not stop at $500,000 in earnings. What about billions?
More money can make us happier by making things easier.
Need dinner? Order it online. Don’t worry about being able to afford food and shelter. But this isn’t a guarantee, even at the $75,000 level.
When I was 9, I was sent to live with a family in Southhampton, England. We couldn’t afford meat. We had a few scraps in soup once a week. No heating. Yet, my adoptive (for the 6 months I was there) family was more present for me than my family at home, I was happier. I felt seen and heard. Making others feel special is something you can do at any income level.
Why is there an upper limit to the money that can increase your happiness?
I don’t know that there is. The follow up study concluded that once you earn $500,000 a year, if you boost that higher, you won’t be happier. But, the number of people who are earning that amount and are also willing to participate in a study are small, so it’s hard to say if that limit is correct.
Reasons for that upper limit are that those who are higher earners include a higher percentage of those who are driven by money as an end goal, via insecurity, so they are never happy. It’s never enough.
Higher amounts of money give us more choice. Choice is an additional mental load. Most prefer some choice, but not too much. And we can quickly become a prisoner to our assets, running from one house to the next.
Can you separate your happiness from money, so that there is no upper limit for you? Can you earn more and continue to increase your happiness, independent of your wealth?
In my 25 year career on Wall Street, I’ve worked for 4 billionaires and interacted with many more. Some are happy, some aren’t. What drives the difference?
How to be happy in 3 steps:
Control over your Calendar
Control over your Confidence
Control over your Capital
Control your calendar
Most people who have made big money enjoy a fair bit of independence, but you’d be surprised that not all are in control of their calendar. Run a large business and you are working for investors, keeping customers happy and feel responsible for multitudes of employees and suppliers.
Work as a board director and watch your calendar fill against your will when there’s a crisis. My friends on boards unexpectedly cancelled plans and worked all weekend after the run on Silicon Valley Bank.
Of my billionaire bosses, two had control over their calendar and two did not. How can you be that rich and not have control over your calendar? Be on multiple boards. Have large clients. Mike Milken should have really appreciated his freedom (I worked for him after jail a.k.a. “camp”). Milken had so many self-imposed obligations. He held dinners and benefits with Deepak Chopra (back in 1993!) headlining. He founded and grew the Milken Institute. All good works, but he had limited control over his calendar.
I once asked one of my billionaire bosses why he thought some super successful people never took control over their calendar.
He said they were used to not having calendar control. Many started as investment bankers or management consultants. They regularly got on a plane for a client at a moment’s notice. The power of habit working against you!
Even after making his first billion, Milken didn’t even consider changing his patterns.
I had far more calendar control, managing money on the buyside. I could decide whether or not to go to a conference…though we all knew which ones we had to be at. I could schedule a vacation… although we all did so in August when nothing happened in markets. And when companies reported their earnings, I still had 3 weeks of working 80-100 hours per week, each quarter, for decades. I had more calendar control than many, but still built patterns.
In 2008, I took my first attempt at retiring. I had absolute control of my calendar. No one to answer to. Yet, each morning at 6am I was on my computer, checking markets and analyzing companies. It took me a full year before I realized I could go on a trip, even during earnings!
No one was paying me. I was free!
We all get in these mental ruts, doing what we’ve done because it’s what we’ve done.
Just because you are used to not having control over your calendar, doesn’t mean it’s what’s best for you going forward. Most with control over their calendar, not having to leave their kid’s birthday party to pitch a deal, are happier and at peace.
Ask yourself: How much do I control my calendar? What would my life look like if I had more control over my calendar? Sometimes, it feels like you can’t change anything. You can. Maybe today, maybe in a month, or a year.
Progress on anything (exercise, diet, calendar control), starts with auditing your current state and making a plan.
Go through your calendar for the last month. What parts do you wish were more flexible? What parts are flexible but you treat them as fixed? Where could you hire an assistant to do some actions and remove them from your calendar? On a day-to-day basis, what would you like to start saying “no” to more to open up your calendar?
Calendar control is not an empty calendar. It’s a schedule (or lack thereof!) that perfectly suits your personality, goals, and desired life. Build it with purpose!
Control Your Confidence
Ego and insecurity are strange bedfellows…
Many billionaires are not confident.
Like a comic who thinks they need alcohol to be funny, some super successful people believe they owe their success to being insecure, untrusting and paranoid. Andy Grove, the former CEO of Intel coined the phrase: “Only the Paranoid Survive.”
Yet, the happy billionaires I know are confident. Not arrogant (markets will obliterate the arrogant). They simply don’t care what other people think.
My reclusive billionaire boss came to a student meeting I was hosting. They didn’t know what he looked like. We were waiting for him at a coffee shop. I told them to point him out when they thought he had arrived.
Various men arrived in khakis and golf shirts. Was it him? Nope.
Others arrived in shorts and hawaiian shirts. Nope. Others in jeans. Nope.
The coffee shop fed the homeless. A few came in. One guy came in with so many holes in his shorts you wondered how they held together. The shirt had been eaten by moths. Hair totally disheveled, like a sandy blond Albert Einstein.
Between the golfers and homeless, the students scanned the room for the billionaire.
They missed him. He was the disheveled guy with moth-eaten clothes. He didn’t do this to be incognito. He just didn’t care. At all. He was my boss for years. He was his own person.
He met an entire room of Goldman Sachs investment bankers and company executives wearing old PJs and bunny slippers… Markets had gotten busy and he ran out of time to go downstairs and get changed, forgetting till it was too late that Goldman was coming… so he just owned it, looked them straight in the eyes, shook hands and went forward with the meeting. That’s confidence.
This isn’t about living a spartan life or a life of luxury. His life had plenty of luxury. It’s not about retiring. It’s about living the exact life you want, without being tainted by outsiders’ opinions.
He was a co-owner of the San Diego Padres, which gave him cred. Yet, the real thing we did for the Padres was manage the players’ retirement account, allowing many of the 1-2 season low paid players to retire comfortably.
His childhood dream was to play in a band. He didn’t let being an owner of the Padres, top charity donor, and hedge fund superstar, stop him from his dream. For years, he played guitar in a band he formed at local dive bars.
Confidence is different from acheivement.
In many ways, confidence is being able to separate you from your achievements. Be comfortable in your skin. Know you have value as a human being. Know you have value to others as a mother, father, partner and friend, separate from your net worth.
Confidence is being, not doing.
Confidence is also a life-long process.
It’s one thing to have confidence, and another to build it. Some keys are loving yourself, genuinely connecting with others, and letting go of your attachment to others’ opinions.
To be confident at any income level, you need to see yourself as a worthy person, a worth separate from your wealth.
Which brings us to the final key to happiness while being wealthy…
Control Your Capital
Don’t become a prisoner of your assets…
Assets are a tool.
The happy billionaires I know have a healthy relationship with money. Some are more free with money than others. It’s not about being cheap or generous. It’s about you being in control of your assets, and in control of your emotional connection to your assets.
Being a prisoner to your assets is working constantly to use and maintain all that you have bought. Planes. Boats. Homes.
My parents are far from billionaires, but they have two houses in two states. They don’t like to fly, so they drive 2 days with their cat and dog to move between houses. By the time they get to the new house, it needs repairs. Once they finish fixing up the one house, they drive two days back to the other one and start maintenance projects.
They are working for their assets.
Happy Billionaires solve this by buying back their time. Have someone manage repairs. When they arrive their time is spent enjoying their assets.
One of my former bosses enjoys investing, but not 24/7 like when he ran a fund. So he invests in stocks that are less volatile, where the returns are longer-term, and he doesn’t need to watch them trade all day. He also outsources managing of some of his money to various investment firms. They watch sectors and stocks all day and call him if something needs his attention.
He has customized his level of involvement to maximize control over his calendar and his assets.
Another way you can become a prisoner to your assets is to have an unhealthy relationship with money.
Just like the comic I referenced before that only thinks they are funny while drunk, many ultra-wealthy got that way with an obsessive focus on achievement as measured by the size of their bank account. They have FOMO with any missed opportunity, big or small, to make or save a buck.
Saving $1 by parking over a mile away has the same thrill as making $1 million on a controversial stock trade. And that next $10M trade, or a kid’s soccer game? Impossible to pass on the trade.
Not being a prisoner to your assets is both a physical design problem (hire people and only have as many houses, boats, planes as you want), and a mental growth challenge (changing your relationship with money and success). These are individual growth paths to greater happiness depending on your circumstances, goals and personality.
Combining happiness and money
There’s a different level of drive needed to generate big wealth. This drive can start from a feeling of inadequacy, a need to prove oneself. As you earn more, money becomes a badge of worth. It’s proof one is worthy… of being seen…of being recognized… of love.
Yet, equating money with love and happiness couldn’t be further from the truth. Success addiction combined with money focus pushes people we love further away, not closer.
My less happy billionaire bosses are still glued to their screens, unable to outsource anything, trusting no one.
The biggest trait unhappy billionaires share is an unexamined life.
Unexamined habits, like those without calendar control.
Insecurity that they could lose everything.
Ego, thinking they are the only one capable of managing their assets.
Penny wise, pound foolish frugality of not wanting to hire people even for simple home maintenance projects (my dad is 87 and still cleans the gutters).
To maximize your happiness at any level of wealth, examine your life along the 3 C’s (calendar, confidence, capital) to find an approach that matches your personality and passions.