How Much Money is Enough?

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By Paul Polak

How much money is enough, and what will I do with myself when I get there?

This question is just as challenging for multimillionaires as it is for dollar-a-day farmers. The dilemma is tantalizingly similar for both.

For the one-acre farmer whose family now has enough to eat for the whole year because they have increased their income to three dollars a day, the question is what’s next? Do they keep increasing their income from farming, or focus on educating their kids, stabilizing their income, and living a happy rural life?

For the multimillionaire, the question is what’s next?

Do they keep making deals and growing their income just like they have been, or take advantage of their economic freedom to make a passionate commitment to write a great novel, make the world a better place, or pursue some other dream?

Small farmers who live on less than a dollar a day often have surprisingly big dreams. A one-acre farmer in Himachal Pradesh, India had just gone deeply into hock to build a small greenhouse where he had started growing carnations and roses for the Delhi market. His eyes widened as we talked about what he could do with low cost drip irrigation. After we finished our tea, he asked for my card.  Eight months later, he sent me an email from his newly acquired Apple computer connected to the internet. He told me his business was growing fast, and he would continue growing it.

When you start out below the survival line, enough money means access to food, shelter, and clothing. But how far should poor people go beyond that? How much is enough?

Warren Buffet and Bill Gates

At the other end of the spectrum, Bill Gates and Warren Buffett, with 53 billion and 47 billion respectively, have decided to give their money away.

Why give it away? Because it gives meaning to their lives, and because the marginal value of wealth beyond a certain amount becomes trivial.

I have several friends who have accumulated millions of dollars from a variety of enterprises, and I ask each of them the same thing.

“What’s your number?”

“What do you mean? They ask.

“Your number is the amount of money you and your family needs to live comfortably.”   For example, if you need $100,000 a year, and expect to earn 5% each year on your assets your number is two million dollars. Once you’ve reached your number, you can start doing whatever you’ve always dreamt of doing all your life.”

“What is it that you’ve always dreamt of doing?”

This is where it gets to the hard part. They may very well say

“That’s interesting. But I like doing deals, so I think I’ll keep doing it”

“That’s fine” I say, but some people dream all their life that if they don’t need to be a working stiff any more, they dream of writing the next great novel, or becoming a professional scuba diver, or a minister, or a philanthropist, or an actress. What’s your dream?”

That’s when we get into a really interesting discussion. Because a deep exploration about living the next dream often turns out to be the most challenging, upsetting and happily transformative things they have ever done.

What if you dream of writing the next great novel, and once you have time to do it you find you really can’t write worth a lick? Sadly, a great many just pass on the creative struggle of learning about their deeper gifts and dreams, and just keep on doing what they’ve been doing all along without thinking about it too much.

A Farmer in India

I have no doubt that the greatest peace and satisfaction comes to people who become passionately committed to something.

Warren Buffett’s passion and commitment is to continue making money to hand over to Bill Gates, whose passion and commitment is to make the world a better place through the Gates Foundation. Mark Zuckerberg, the founder of Facebook, just announced he will donate $100 million toward improving public schools in Newark, New Jersey, and a friend of mine who is an internist in Toronto is passionately involved in a nature preserve he started in Ecuador connected to his university.

What’s your passion and commitment for the years you have left?

For me, the opportunity to satisfy my insatiable curiosity and tackle the problems of extreme poverty that most people see as unsolvable has been more fun, and has brought more of a sense of deep peace, than anything I could have ever imagined. It all started when I reached my number from real estate investments 45 years ago.

The challenge is the same for the family who has moved from one dollar to three dollars a day and the entrepreneur who has become a multi-millionaire. How far up the economic scale should the poor family dream of moving to be happy? And how should the person who has become a multi-millionaire decide what to do next?

This Post Has 6 Comments

  1. Deborah

    I doubt I will ever hit my number, but I still spend a substantial portion of my time involved in helping youth leaders, social entrepreneurs, etc. as a volunteer and mentor. I’ve taken the time to study things that may help me contribute to solving major world problems. I may never be able to retire, but that has been no reason for me not to start to do something meaningful now. I see many other former MBAs who think they have to wait till they hit the number to do something simiilar; I don’t think it needs to be an either/or.

  2. Kathryn Polak

    I agree with you Deborah, I don’t think there needs to be an either/or to feel as if I can contribute something meaningful towards making the world a better place, regardless of where you are in reaching your number. For me, when reflecting on the where and who I am, knowing that I am reaching for something meaningful is far more important to me than reaching for that number.

  3. paul polak

    Deborah and Kathryn, I agree with both of you!

    I guess the point i was trying to make in the blog is that the challenge of figuring out what to do with your life is pretty much the same, whether you’re living on 3 dollars a day or a few million dollars a day.

    If that’s true, it also applies to everybody else in between

    paul polak

  4. Amanda Abu-Basutu

    Marslow’s hierachy of needs model propounds that human needs progress to higher levels as lower level needs are satisfied.I also think its interesting in the context of poor families,how when they satisfy one level of needs ,they immediately discover how much they really don’t have.The smallholder technologies you advocate is a real example of giving a man a fishing line.He can then go on to catch more fish to attain higher level needs.

  5. Stuart Dobson

    It depends what you want to do with your life. If you simply want to be free of the daily grind, be a true minimalist, the number should be very low. My number is zero. I want freedom from money but still want my basic needs. Is this possible? That’s something I want to find out.

  6. Liz Sinclair

    As long as your basic needs are met, I think the number can be illusory and a trap. I didn’t have my number, but I wanted to be of service in a developing country and be a writer, so I took a year off and went anyway. One year turned into three. I’ve created a new career as a grant writer and I’m an award-winning travel writer. I still don’t have my number. I may never have it. Sometimes, waiting for the number is just an excuse to keep postponing.

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