My husband and I are both in our early 30s.
Our combined net worth is close to CA$750,000.
Recession risks and housing market fluctuations aside, becoming a millionaire within the next couple of years is a real possibility.
But guess what?
I feel financially insecure sometimes all the time.
No, I’m not being coy.
No, this is not a humble brag.
My net worth spreadsheet tells me that my finances are in decent shape, but my silly brain prefers to focus on the miniscule segment of financial overachievers who’ve reached financial independence in their late 20s – my financial success pales in comparison.
I can’t help but feel that I could’ve done more towards building an even bigger nest egg, and may be lagging behind the financial rockstars forever.
And I know I’m not alone in feeling this way.
The prevalence of social media heightens the impression that others are enjoying more financial successes, which in turn, make people feel inadequate and maybe even a bit depressed.
Social media isn’t entirely to blame, of course.
Human beings have this funny psychological tendency to normalize the status quo, and are thus never truly satisfied with the status quo. Comparing ourselves to others is an evolutionary gift that drives us to continually better ourselves and avoid complacency, but it does come with emotional costs and daily stresses we can do without.
Having survived being an underdog throughout my formative years, I have, somewhat reluctantly, mastered the art and science of giving myself insanely effective pep talks.
And now I want to share my perspectives to help others who are struggling with feeling financially behind.
I can’t promise to change lives, but hopefully you’ll find solace in this article.
Don’t Tie Your Self Worth to Your Net Worth
Whenever two people meet for the first time – at a networking event, a date or a house party – one of them invariably asks the other, “What do you do for a living?”
Most people ask this question to break the ice and find possible common grounds.
But answering this question inadvertently reveals a whole lot about the answerer’s financial status.
And that’s problematic because most of us instinctively place people in distinct categories based on their rung on the corporate ladder – and by extension, their socio-economic status.
Worse yet, we subconsciously rank their worthiness accordingly.
Yes, our identities are intricately tied to our careers and financial accomplishments.
But does that mean that a plastic surgeon is automatically a better human being than their assistant? That a decamillionaire is somehow more praiseworthy than a plain ol’ millionaire by default?
Nope. Non. Nein. Niet. Não. Nahi!
We’re more than the sum of our assets minus the sum of our liabilities, or the number of zeros on our paychecks.
What defines your worth should come from within you – something intangible that cannot be quantified or compared.
It could be your resilience, your integrity, your sense of humour, your emotional intelligence, the strength of your relationships, your uncanny ability to accurately predict the outcome of any situation. The life experiences you’ve had, especially the challenging ones that shaped your outlook on life. The cultures that you’ve appreciated. The moments that you’ve truly savoured. The people whose lives are better thanks to you.
All of these are insanely valuable accomplishments that money cannot buy.
Absolutely nobody can take them away from you, because they’re a part of you.
Therefore, absolutely nobody can make you feel “behind”, because nobody is better at being you than you.
As North Americans, we often talk about how the top 1% owns 99% of the financial assets, conveniently forgetting that – to the rest of the world – we’re that 1%.
Even among the OECD countries, the typical North American household’s wealth reigns supreme.
Case in point:
Source: HowMuch.net, a financial literacy website.
Interestingly, countries that top every world happiness ranking – Finland ($28k), Norway ($20.3k), Denmark ($73.5k), and Iceland ($64.4k) are nowhere near the richest.
Which goes to show that:
Happiness is subjective. Wealth is relative.
Chances are, we already have all the wealth we need to be happy. We just don’t realize it when keeping up with Joneses is top of mind.
Wealth isn’t just a dollar figure. It’s also having peace of mind, a roof over our heads, unlimited supply of clean water, more entertainment options at our disposal than we have time for, and a social safety net that insulates us from the vagaries of life in abject poverty.
Take stock of the unfortunate people around the world who consider everything we take for granted luxuries, and suddenly our own perceived financial shortcomings seems like a nothingburger.
In a way, we need to reinvigorate our ability to be happy, by recognizing that happiness is not brought forth by acquiring more “stuff”, and practicing gratitude.
A good way to remind yourself how lucky you are and gain some perspective is by volunteering to help the needy and donating to charities if your budget allows.
I know it seems counterintuitive, but giving money away actually makes you feel richer – not to mention more confident and content. And donating your time yields similar results.
It might just provide the much needed push to get us off the consumerism bandwagon.
Forgive Yourself for Your Mistakes
The feeling of financial inadequacy is sometimes tied to guilt over past financial mistakes.
I have certainly committed my fair share of financial faux-pas.
- I didn’t open a RRSP until I was 27.
- I didn’t open a TFSA until I was 30.
- One time, I even wasted $5,000 on plane tickets because I overlooked the expiration date on my passport.
In an ideal world, every one of us would avoid consumer debts altogether, save every spare penny towards retirement, have 800+ credit scores, never miss a bill payment or face hairy and costly emergencies at inopportune times.
In the real world, nobody is perfect. Shit happens.
But you have the agency to decide how to process the past.
You can choose to wallow in regrets forever. Or you can come to terms with whatever financial mishaps that burden your conscience, dust yourself off, vow to never make the same mistakes again, and come out stronger on the other side.
As for me, I have learned my lessons.
No matter how much I want to, I cannot travel back in time to start investing earlier. So I did the next best thing: I put in triple the efforts.
I knew I had a lot of catching up to do, so I’ve been contributing to my RRSP and TFSA like a mad woman (while encouraging my husband to do the same) for the past years. Now I have finally reached a point where I am honestly proud of my investment portfolio.
During the same span of time, I have pushed myself to take my digital marketing consulting business to the next level. Although I can’t attribute any specific earnings to the $5,000 incident, I’d like to think that this disastrous financial event manifested into a constant source of motivation for me.
I have forgiven myself for my financial oversights. So should you.
You’re Surrounded by Zuckerbergs
Mark Elliot Zuckerberg, the Founder and CEO of Facebook who celebrated his 35th birthday not too long ago, is currently worth around 70 billion dollars.
But I bet you aren’t too bothered by this tremendous wealth gap.
Well, isn’t that interesting?
Here we have one of the richest men alive “showing off” his substantial fortune every time we’re served a perfectly targeted Facebook ad. Yet, we’re far more envious of friends who share photos of their latest foreign excursions on the same social network – even though they’re nowhere as wealthy as Zuckerberg.
I can think of 4 plausible explanations why this happens:
- Zuckerberg’s journey of turning a silly site that he built in a Harvard dorm room into the mega tech giant that it is today has been well documented. If we were to be honest, this is something that most of us would not be able to pull off. So we feel like his wealth is proportional to his superior entrepreneurship, and is therefore well deserved.
- Second of all, his wealth is so far above that of the average person that we don’t even compare ourselves to him. He is in a whole other league, and rightfully so.
- We know of him, but we don’t really know him. He doesn’t come to our Sunday barbecues or baby showers. For all intents and purposes, he might as well exist in a galaxy far far away – another reason why we exclude him from our frame of comparison.
- He is not just financially ahead of you. He’s financially ahead of all of us. When someone is that wealthy, it doesn’t feel personal. He’s not rich at you. He’s just rich.
Just because a wealthy individual happens to be in your social circle, it doesn’t seem fair that you treat them less favourably than, say, an actual multi-billionaire that doesn’t even know you exist.
So let’s mitigate that.
Think of your richer friends as a small army of Mark Zuckerberg clones (minus the creepy factor).
They might not be as rich, but if their struggles and sacrifices made behind the scenes were suddenly publicized, I have a feeling you would applaud their tenacity and effort, and get off the envy train because you know that their wealth is well deserved, just like Zuckerberg’s.
So the next time you log on Facebook and get bombarded by perfectly-timed vacation photos, I want you to ask yourself: how would I feel if these photos are shared by Mark Zuckerberg himself? (Answer: you’d probably feel mildly amused and curious, with no hints of jealousy.)
Accept Others’ Privileges
Those who were born in well-to-do families are often granted privileges that are inaccessible to others.
Having privilege does not negate a person’s accomplishments, nor is the lack of it a convincing excuse for giving up.
With that said, I’m not oblivious to the fact that not everyone is on an even-level playing field to begin with. No matter where someone lands on the privilege spectrum – from extravagant gifts to trust funds – they have more pathways to success than someone with no privileges, all else being equal. It’s only natural to feel financially behind these lucky folks.
The best way to deal with it? Be cognizant of others’ privileges, tweak our expectations accordingly, and not let it influence how we perceive ourselves.
Dwelling on privileges we don’t have is a complete waste of time. Sheer will power alone never adds or removes privileges.
There’s no app that allows us to pick a wealthy family to be born into by swiping left or right, so why be bothered by something we had no control over?
Let’s focus instead on making the best out of the hand we’ve been dealt – that means, devoting more mental energy into paving the way for future generations to have access to advantages in life that we didn’t have.
Make Peace with Your Choice
For most of us fortunate souls, making more money is, without a doubt, an attainable possibility.
Off the top of my head, here are a few options:
- You could work overtime
- You could switch to a higher paying career
- You could start your own business
- You could start a side hustle or two
- You could rent out parts of your home on Airbnb
- You could schmooze with the higher-ups to get a promotion
What do all of them have in common? They require sacrifices.
In essence, you’d be trading time for more money, trading lifestyle for more money, trading mental health for more money, or even trading dignity for more money.
Don’t get me wrong. I truly admire ambitious folks who would stop at nothing to chase their financial dreams. But not all of us are willing or ready to make those trade-offs.
Some are truly okay with earning less money if it means pursuing a career that brings fulfillment rather than chubby paychecks, maintaining a healthy work-life balance rather than beefing up the wallets of therapists, and never missing their kids’ soccer games or dance recitals. And that’s equally commendable.
If you feel financially behind, ask yourself if making the necessary sacrifices to move up to the next income tax bracket is worthwhile to you.
If the answer is yes, great! Go rock the world and show us what you’re made of. (Feel free to skip to the next section of this article.)
If the answer is no, that’s great too! You might not be making as much money but you’re happier this way.
To those who’ve answered “no”, I have more to say:
We don’t all make the same choices in life (and that’s what keeps the world an interesting place). The key is that you get to make that choice, and make peace with the fact that you might be missing out on extra earnings to focus on things that are of higher importance to you.
If you’re finding it tough to defend this decision to yourself, it might be because you’re secretly harboring hope that it’s possible to have it all: a high 6-figure income, happy hours and date nights on the regular, while putting in zero ounces of extra efforts.
But that’s just not realistic. Even successful gold diggers don’t have everything handed to them (even though it appears that way) – it’s a lot of work to keep rich people happy and stay in top physical shape!
But I disgress.
My point is: if you’re anything but 100% content with your choice, you have free reign to make changes until you reach a point where you can accept the negative outcomes of your decisions.
When you’re genuinely happy with your choice, there’s no reason to feel behind. Others who’re financially better-off just made different choices and accepted a different bucket of hurdles to deal with.
It’s Not a Race (That You Can Win)
Let’s imagine a parallel universe where you’ve chosen a different path in life: you co-founded a ride-sharing company that went public after 10 years.
You’re wealthy beyond your wildest dreams.
You now live in a 11,000-square-foot stately mansion in Beverly Hills that is decked out with an indoor basketball court, heated marble driveway, and a helipad.
Your Saturday afternoons are spent attending charity golf tournaments, and other events attended exclusively by the upper echelons of society.
Your road to extraordinary success has been featured on every trade magazine under the sun.
You have finally made it.
You must feel on top of the world. Right?
But hold on.
In this alternative universe, instead of your wage-earning buddies, you’re hanging out with CEOs of public companies, heirs to the Wal-Mart fortune, and probably Kylie Jenner – the youngest billionaire in 2019 – if you’re lucky.
Newsflash: they’re even wealthier than you are.
In the end, going strictly by wealth levels, you still feel behind – the proclivity to compare ourselves to others doesn’t vanish into thin air once people reach 9 digit net worth.
As your net worth rises, so will that of the people you surround yourself with.
There is no dollar amount large enough to be “enough”.
Because no matter how rich you are, there are and always will be someone who is richer.
How to not feel financially behind is to, ultimately, be 100% okay with it.
After all, we are all financially behind.
Every single one of us.
Even Sir Richard Branson (69 years old, 3.8 billion net worth), Abigail Johnson (57 years old, 14.5 billion net worth), Li Ka-shing (91 years old, 31 billion net worth), Michael Bloomberg (77 years old, 51.1 billion net worth), Warren Buffett (89 years old, 82 billion net worth), and Bill Gates (63 years old, 105 billion net worth).
All of them are technically “financially behind” the Founder and CEO of Amazon, Jeff Bezos, who is younger (55 years old) and richer (113.5 billion net worth).
And it’s only a matter of time before a younger and richer person claims the “Richest Man Alive” throne from Jeff Bezos.
Knowing that takes the pressure off, doesn’t it?