marginal utility of money

Something our boss said this morning hit home more than I care to admit. He said the marginal utility of money is very small, much smaller than we give it credit for. When you've earned enough to cover your basic necessities, the quest for additional money just to keep up with the luxuries of life is often where you get into trouble. Definitely, when you are in need of money, because you cannot cover the basic needs of you and your family, then money is at its most use (and of most importance) to you. Then you crave more, to cover life's little luxuries, which I guess is still okay. After all, what differentiates life from existence is quality. And certain aspects of a quality life do require some measure of money. For example, travel is life-enriching but is also a rather expensive hobby. Education is another, though basic education would mean getting educated here whereas "luxury education" would mean a foreign degree or even an additional degree like an MBA. You would also need a cushion to cover a rainy day (or days, as last week proved to be), especially when you have aging parents or many dependents or simply just for your sanity. In Manila too, a car is almost a necessity, as is the occasional movie and dinner date to destress.

However, after you've checked those marks, and you crave more money, you'll find this incremental moolah to deliver way less than what the earlier amounts did, at least in terms of satisfaction and happiness. In fact, you'll discover that what you need to sacrifice, in the name of this additional money, may cost you more than the benefits to be derived by the possession of these incremental pesos. Such examples are time with your family, your health, your spiritual life, or simply just your life. In the quest for more money, you run faster and faster on the hamster wheel, only to end up not being able to enjoy the very money for which you exerted that much effort for. Worse, after earning so much money, you find yourself dying due to the stress of the quest.

So I guess the point is to continually reflect and evaluate the "point" in everything we do, including everything we sacrifice. There's obviously a tradeoff, and the reward that you're working for may or may not end up to be as satisfying as it appeared to be in your head.

Definitely, at this age, my husband and I are still very much justified to stay in the rat race. After all, we don't have children yet, and I've heard children tend to cost a substantial amount of money. Plus, we do have dreams yet to be achieved, before we can say we've had enough of our work. But it's good to see this perspective from a 50-year-old marketing veteran and learn that, after a certain point, you really don't need "more" anymore. Life is not about that at all. What's tricky is knowing where to draw the line and keep your sights at it, no matter the temptation (whether in your head or through people around you). Hopefully, you'll also be brave enough to get off the horse when you need to, in recognition of better things to allocate your time, effort and attention for, even if these things do not appear in a bank statement or chequebook. Unlike in the corporate world, achievements in life are not supposed to be in numerical format.

:)