Three Questions to Increase Happiness

Three Questions to Increase Happiness

Shelter-In-Place Offers Opportunity for Reflection: What makes us happiest?

Our quarantines and shelter-in-place this year have been difficult for many, but it would be a shame not to use the current situation to learn more about ourselves, says Shlomo Benartzi, PhD, an expert in behavioral finance and a professor at the UCLA Anderson business school. He suggests three questions for us to ponder that could lead to a greater sense of happiness. Money means different things to different people, and he encourages people to use this opportunity to think about what it means for them specifically.

Question 1 – Am I Spending Money On the Right Things? If the goal is to maximize happiness, am I spending in line with that goal? Many behavioral scientists believe that spending on experiences rather than things leads to a richer emotional life. We can be thrilled by a pair of new shoes or a new set of dishes, but we habituate quickly to the new purchase – it does not continue to thrill us. But experiences, Benartzi says, give lasting pleasure in a few ways. Experiences such as vacations are fun to plan, and then they are fun while they are happening, and they are fun in the re-living of them through shared memories and photos. Experiences can make us happier for a longer period time, these scientists say. The pandemic gives us a unique opportunity for us to find out what kinds of spending makes us happiest. Going to eat at a restaurant gives pleasure to many, and how much do we miss it? What about going to a gym? Once things are open, do we run to the clothing store or to a yoga class with others?

Question 2 – Is This What Retirement Will Feel Like? Behavioral economists have always suggested that people take a “test drive” for retirement, by taking a break from work to explore what retirement feels like. The Coronavirus quarantine has felt to many like a kind of forced mini-retirement. Several of our clients who are furloughed say they feel this strongly. What does it feel like to stop working? What fills your day? What gives you a sense of fulfillment and contentment? Benartzi says that most of us might never actually take a test drive of retirement in real life because we are too busy to put our lives on hold, just to find our answers to these questions. So with the current situation, he says it’s a good thing to fully explore our situations. Do you have trouble with isolation and miss the office? You might want to plan to work longer. Do you find interests to fill your days and feel fine without colleagues and meetings? Are you anxious to go back to work, or do you never want to go back? Do you dream of a different kind of work? Thinking about these questions will help you create a plan for your real retirement that could make you happier. It’s not the same for everyone, but we can learn from each other’s responses.

Question 3 – Can I Spend Less? The pandemic has certainly curtailed most of our spending nationwide, whether we wanted to do that or not! Spending dropped more than 23% in the quarter from the year previous, and that’s not surprising, considering that most everything had to be purchased online. This offers an opportunity to analyze ourselves and our spending – are we more happy or less happy with the reduced spending? Academic research gives conflicting results about whether money can buy happiness, and much of it depends on Question 1, how you choose to spend. But Benartzi encourages people to think whether the cut-back in consumption has made them feel better or worse. If you have remained fairly content despite buying considerably less, maybe there is room for more savings in your future.

Behavioral finance is the application of a specific field of psychology—cognitive psychology—to finance. Cognitive psychology focuses on “the study of higher mental processes such as attention, language use, memory, perception, problem solving, and thinking.” What we have learned from behavioral finance has emerged from laboratory research and large group data sets, often conducted by economists.

Another Set of Three Questions

This shelter-in-place is definitely a time to think about values. Many people want to sort that out,  but how to even begin? George Kinder, author of The Seven Stages of Money Maturity, has developed his own “three questions” to try to elicit what people want from their lives.

Question No. 1.  Imagine you have enough money to satisfy all of your needs, now and in the future. Would you change your life and, if so, how would you change it?

We can think about what we would do if we didn’t need to worry about money. What would you change about your life? Would your values remain but your goals change? “It’s the winning-the-lottery question,” Kinder says. “What we’re trying to get at is, what do you care about the most?” He says people often mention hobbies they wish they had more time for, things they want to buy, and trips they would like to take. “The people who say they’d quit their job is less than 10%, but the people who say they’d work less might be 40%,” he says.

Question No. 2. This time, assume you are in your current financial situation. Your doctor tells you that you only have 10 years to live, but that you will feel fine up until the end. Would you change your life and, if so, how would you change it?

By narrowing the focus to 10 years or less, Kinder says, he challenges people to consider what is most important to them right now. “You get a sense of mission,” he says. What are you going to deliver? It might be a greater orientation to family, or to travel, or to doing something creative. This is where people might say they want to write a book. This is the question where virtues come out, “People say they want to be better.”

Question No. 3. This time, your doctor tells you that you have one day to live. Look back at your life. What did you miss out on? Who did you not get to be? What did you fail to do?

“The point is to reflect on your life,” Kinder says. It’s about what would you regret not being able to do, if that diagnosis were true, and what would you change given the chance. “With this final question, you get down to bedrock, what’s absolutely critical.” Sometimes it’s something creative, like ‘I never got to play jazz in a club.’ Or it could be something that’s blocked a person for years, like ‘I never resolved my relationship with my father.’ Kinder likes this question because it goes to the inner core of what is important in people’s lives. “It’s not about paying the mortgage. It’s not about putting in the new kitchen.” He says that many people find satisfaction from using that framework for thinking about their lives and then making small changes – whether it is spending a little less time watching television and focusing on something they always wanted to learn to do. “If you can figure out what you are passionate about, that can provide a road map. But it can also spur you to consider how you can find extra time for the things you really care about.”


Blue Spark Capital Advisors

We're a fee-only Registered Investment Advisory and financial planning firm based in New York City and the Berkshires.

We specialize in working with women after divorce, death of a spouse, or other life transitions such as retirement or job change. We provide financial planning and investment management services.

We believe in a holistic approach. Movement in each piece of your financial plan impacts the others, so we consider your entire picture.


Contact Us

31 Hudson Yards (11th Floor)
New York, N.Y. 10001
(212) 537-3899

Berkshire Block
321 Main St, Suite 205
Great Barrington, Mass. 01230
(413) 551-7000

Home Bottom #4 Widget

This is a widgeted area which is called Home Bottom #4.

bluespark financial in the news
"Integrity without knowledge is weak and useless, and knowledge without integrity is dangerous and dreadful."
– Samuel Johnson (1709-1784)