The meaning of true wealth

My wife Tammy has a vivid childhood memory of riding through the nicest neighborhoods of her home town with her mother, a real estate agent. Together, they would dream of what it must be like to live in those huge, lovely, and expensive homes.

One day she asked her mother why the curtains were often drawn on so many of the houses, assuming that their occupants simply valued their privacy. “Privacy?” her mother replied. “Honey, half of those people can barely cover their mortgages, much less afford furniture. They just want you to think they’re wealthy.”

Contrast that with the story of Ronald Read of Brattleboro, Vermont, a man who had spent his adult life working a series of unglamorous, low-paying jobs: service station attendant, maintenance worker, department store janitor. He drove an old, inexpensive car and was often seen walking blocks out of his way to avoid paying for parking. Ronald’s friends recall him wearing a coat held together with safety pins. Yet by all accounts, he was able to lead a peaceful, simple, and content life until he died in 2014 at age 92.

Upon opening Mr. Read’s safe deposit box, they discovered a five-inch-thick stack of stock certificates representing ownership in nearly 100 companies, most of which had paid him regular cash dividends that he religiously reinvested.

Ronald Read – the janitor – left an estate of almost $8 million. Most of it went to a local hospital and the public library where he did his stock research, for free.

Ask many people for their definition of wealth and they’ll talk about a high-paying job, the spacious home they live in, the fancy car they drive. Occasionally you will hear about how well their investments are performing relative to the market averages. Eventually, however, the discussion gets down to what seems to be a simple, universal definition of wealth: how much money you possess.

I must confess to sharing some of those same beliefs for the early part of my life. Society teaches us to study hard in school to get a good-paying job, and then work your way up the ladder of success. Move to a bigger home in a trendier neighborhood, buy a nicer car, take more expensive vacations. It won’t be easy, of course. You’ll have to work longer and harder than most folks to get where you need to be. But one day, you’ll become truly wealthy.

At least that’s how I used to think.

I’ve taught our clients many things about saving and investing, but I have to give them credit for helping me understand the true measure of wealth.

Some of our clients spend the year traveling from one exotic destination to another. Others simply relish the opportunity to take their grandchildren to free concerts at the botanical garden. One of our clients went from a corporate downsizing to a wildly profitable home business. Another’s idea of seeing the world involves annual mission trips to third-world countries.

They come from a variety of experiences, education levels, incomes, and net worth, but most of them seem to share a definition of wealth that I might have realized much earlier in life had I been more diligent in reading my Thoreau:

“Wealth is the ability to truly experience life.”

Our clients have taught me that wealth is not about having a specific amount of money but having enough of it to support a lifestyle of their own choosing. And the day they realize that they get to make that choice for themselves – and thereby define what qualifies as true wealth – their lives get a lot simpler and more enjoyable.

True wealth is not how much money you make or how much of it you possess. It’s not where you live or how you spend your summers. And it certainly isn’t about how your investments stack up against some arbitrary benchmark.

True wealth is about the freedom, security, and dignity that comes from simply knowing that you have… well, enough. It comes on the day you realize that you no longer have to work for money. It’s when your money makes more working for you than you did working for it.

I hope that one day you will enjoy true wealth if you’re not already. And I hope you realize that you alone have the power to define it.