In this post, I’m going to give you some ways to find out how much is enough for you. This is so important because it’s much harder to reach financial independence if we don’t know what our enough is.

Enough is where we could find more peace in our life. It’s where we’re going to have enough to be content or happy, but not so much where we stop being grateful for the things that we do have. And if you can find your enough, then that’s going to lead to true wealth.

At a party given by a billionaire on shelter island, Kurt Vonnegut informs his pal Joseph Heller that the host, a hedge fund manager, had made more money in a single day than Heller had earned on his first wildly popular novel, Catch-22, over its whole history. Heller responds, ‘yes, but I’ve got something that he’ll never have: enough.’

John C. Bogle*

So, enough is going to be different for everyone. And it’s best illustrated by a chart from Your Money or Your Life by Vicki Robin that shows the relationship between the money that we spend and the fulfillment we receive from it. While we all follow the same curve, the dollar amounts are different for each person.

• Survive
  • This is where you get a lot of fulfillment from every dollar that you spend because you’re spending it on things that are necessities: food, water, and shelter.
• Comfort
  • The next level is where you start to spend more and your fulfillment level grows equally. These are the things that make life enjoyable.
• Luxury
  • This is where it gets interesting. At the luxury level is where we have our fun, but this is also where the curve starts to flatten out. This is your enough. Up to this point, every dollar you spent increased your level of satisfaction and fulfillment. But after this point your satisfaction level starts to level off or decrease.

You might be thinking this decrease wouldn’t happen to me, but I’ll show you how it happens. As you start to spend money on things that you don’t need or use, this starts to decrease fulfillment because everything you buy will start to take up more mental space or more physical space, but the return on satisfaction is low. What ends up happening is more complexity and more responsibility, and really added on stress. This could also lead to poor stewardship for what we’re managing.

Have You Reached Your Enough?

There are a lot of people who have actually achieved this level of enough, but they just don’t know it yet. I was listening to an author recently and he was writing a book on the relationship between money and happiness. He interviewed dozens of people who we would consider wealthy.

First, he asked a friend who had over a million dollars in investments in the bank, do you feel rich? And the friend said, no, because I don’t have $10 million.

Next, the author interviewed a woman who had $10 million and asked, do you feel rich? She said, no, because I don’t have a private jet yet.

And then he asked a man who had a private jet and he asked, do you feel rich? He said, no, because this jet is only a six-seater and I could get a 12-seater or 20-seater.

That example might sound silly, but it really relates, because if we don’t define where our goalposts are or what we’re aiming for, it’s always going to be out of reach. I’m sure you can relate. And it might just be the way that we’re designed, our human nature, to always want to achieve the next level. But if we could find our enough, we’ll start to live a truly wealthy life.

How Do You Find Your Enough

First, we need to start with something that’s boring, but it’s evaluating where our current expenses are. MINT.com could be a good resource to help you do this automatically and easily. This is crucial to finding your enough.

Then, we want to make sure that we know what our values are; to define the things that are most important to us. When our values become clear, then money decisions become easier. We can quickly realize if our expenses line up with our values. For example, if health was important to me, then a purchase of a $2,000 exercise bike might be in line with my values, whereas a $1,000 new TV might not be. But my neighbor, who has different values than me, might think that $2,000 for an exercise bike is ridiculous because it doesn’t line up with the things that he values most.

It’s important to remember that everybody’s different and everyone has different values. Knowing yours and how they match up with your expenses is important. If you need help refining your values, click here to access a free one-page worksheet that will help.

Once we’ve defined our values and aligned our expenses, look at the fulfillment curve to discover our peak fulfillment point. Look for the place where you have what you need and you can buy a few luxuries that align with your values, but not so much where you start to over-complicate your life. Many people think that this is a lump sum number. But it might be easier to think of it as an income number. This means: how much would be enough to be coming into the bank each month without you having to actively work for it, and then work backwards to see how much in assets you need to provide that income.

An important final note

Remember that you’re enough right now. Your income and your assets don’t make you enough. Yes, we have to figure out the money stuff because the world uses it. But I’m sure you’ve heard, like in the jet example, there’s very rich people who never feel like they are enough or that they have enough because they’re looking for more money to prove it. And the sad thing is, I don’t know if they’ll ever get there. So none of it is easy, but I hope this helped you think about this idea of enough in a different way.

*The John C. Bogle quote is from his book Enough: True Measures of Money, Business, and Life.