Sometimes people love using a blunt instrument. Yet, this person is implying that a high savings rate will inevitably lead to regret when we die young. You only live once, they say!
I agree that there must be a balance between our current happiness and our savings rate (I recommend The 10% Rule as a tool to find that balance). But it isn’t this simple.
The relationship between money and happiness is complicated. And that is exactly what we are going to examine.
We must first realize our propensity towards irrational decisions. Then, we must follow a carefully crafted plan to keep us on track.
The Easterlin paradox suggests that happiness does increase with increasing income, but only to an extent.
Spending money does make us happy. However, there is a catch. We must spend money on the right things.