Andy Gullahorn, a gifted singer-songwriter, recently delivered a gift of his own with an unlikely wrapper. Using a provocative metaphor, he asks: “Does it really count as ‘Yes’ without a chance of ‘No’?” His point is philosophical, not salacious—real desire requires the possibility of rejection; satisfaction requires risk.
He concludes, ‘We think we know what we really want, but what we really want lies underneath,’ and that is precisely the topic on my mind:
How do we know what we really want?
And I believe this question, while rarely asked within the financial planning domain, is actually one of the most important we could ask. Too many financial plans are accidental, unintentional, uninspired, or based on someone else’s answer to the question, “What do we really want?”
The Illusion of Optionality
Plans that are too open-ended tend to provide the illusion of optionality. Psychologist Barry Schwartz’s research on the “paradox of choice” demonstrates that excessive options don’t increase satisfaction—they decrease it. When everything remains possible, people experience more anxiety, more regret, and less confidence in their decisions. Paraphrasing Warren Buffett, you can do anything, but you can’t do everything.
For example, a retirement goal that only consists of two numbers—to have $4,000,000 saved to retire at 65—provides you with plenty of options for precisely what to do when you retire, but because there is no reference to why you’re retiring in the first place and how to spend your time in retirement, the result is a hollow plan.
It’s like you’ve purposed yourself to get a college degree without identifying a major or the job you hope to receive when you get out of college.
You might hit your numbers, but still feel empty because you never defined what the numbers were for.
However momentarily satisfying it can feel to hit our numerical financial goals, lasting satisfaction most often comes from the genuine lived experiences that you hope to fund with your savings, not the saving itself. And that may require closing some doors to enable you to walk more fully through others.
The Purpose Of My Wealth Is…
Research in behavioral economics shows that when financial decisions align with clearly articulated values and purpose, people experience less decision regret, higher satisfaction with outcomes, and better follow-through on their plans. Purpose acts as what researchers call a ‘commitment device’—it defines not just what you’re saving, but what you’re saving for.
While I don’t adhere to an exclusionary doctrine that insists there is only one way to imbue your financial planning with a greater sense of purpose, the simplest I may have found is to consider and answer this question:
The purpose of my wealth is…[fill-in-the-blank].
I’m not inclined to tell you what a good or bad answer is, but it could be a word, phrase, sentence, paragraph, or even a series of photos that illustrates what’s most important in your life.
Of course, one of the challenges with this question is that it, too, can be pretty open-ended, so I created an exercise (below) that allows you to limit the seemingly infinite range of response options to six simple prompts that should help you excavate the raw materials necessary to complete the sentence above, defining your Net Worthwhile®.
Because, as Andy Gullahorn sings, “What we really want lies underneath what we settle for when we don’t believe we could ever have what we really want.”
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