“Money can’t buy happiness.” It’s a wise proverb that most of us have heard dozens of times, many of us as children from our parents or school teachers.

But is it true?

I would say the answer is “yes…and no.” Let me begin to explain by first sharing a personal example from my own life.

How Are We Ever Going to Buy a Home?

My wife and I were very young when we were married. I had a job, but Kendall didn’t. For the first year of our marriage, we were forced to survive off of my income alone.

Oh yeah, and did I mention my job? A newly ordained pastor.

Let’s just say we weren’t bringing down the big bucks.

So while we survived, we were by no means thriving. We were renting and wanted to save to buy a home. But we weren’t able to save in any substantial way towards that goal.

After we had been married about a year, Kendall landed a part-time job with a private school in town teaching art and handling their after-school care. Again, we weren’t talking about bucket loads of money that we were bringing in from this job.

On average, it was probably between $800-$1,000 a month.

That would have bought a lot of extra groceries or a few more out-to-eat nights. It was tempting for us to just exhale and enjoy a little extra breathing room in our monthly budgets.

But instead, we made a decision that wasn’t easy. We chose not to touch one cent of this 2nd income stream, and instead put every penny of it away in our home fund.

Again, this was not an easy decision. But looking back now, this was one of the best decisions that we ever made as a couple.

Lifestyle Goals Are Financial Goals Too

What motivated us to adopt this financial strategy? Through ongoing communication, Kendall and I had identified a couple of lifestyle goals that were important to us:

1. We wanted to own a home.
2. We wanted Kendall to be able to be a stay-at-home mom once we started having kids.

Now here’s the deal. We couldn’t achieve goal #1 with my income alone. But in order for goal #2 to be possible, we would eventually HAVE to live off of my one income.

Living off my income and saving hers was the perfect way to reach both goals.

First of all, we were able to save over $10,000 for the down payment on our home in less than a year!

Goal #1- Check

But since our standard of living never rose during that time, it wasn’t hard at all for Kendall to quit her job once our first son was born. We didn’t feel any financial squeeze whatsoever when we lost that income.

Goal #2- Check.

Did our savings rate go down after Kendall started staying home? You better believe it did!

But at least we didn’t have to wonder if we were going to be able to pay the light bill or the mortgage. We knew we could do this on one income because we had been doing it all along.

Not every goal starts as a financial goal. Some goals are career or lifestyle goals.

But nearly every goal will inevitably BECOME a financial goal because nearly every career or lifestyle goal will necessarily affect how we handle our money.

• If owning a home is important to you, then you’re going to need to make a financial plan to make that dream a reality.
• If you want to give more to charity this year, that goal is going to have show up on your budget.
• If travel is important to you, then having a smaller home (and mortgage) that allows you to save money each month in a travel fund could ultimately make you happier than you would ever be in a bigger home with a suffocating mortgage payment.

How Money CAN Buy Happiness

When people say that money can’t buy you happiness, what they usually really mean is “THINGS can’t bring you happiness.” And with that statement, I wholeheartedly agree.

In my line of work, I’ve talked to many pastors who left high-paying jobs to pursue ministry positions. Many of them had to downsize their homes and cars in the process. But they always said that they were happier in the present than they had ever been before.

But I’ve also talked to numerous men and women who have told me that they wanted badly to work for a church or other non-profit, but because of past financial mistakes or debts, they simply couldn’t afford to take a pay cut.

My own brother and sister-in-law were in this exact situation a few years ago.  My brother-in-law desperately wanted to leave his job in education but felt trapped because of finances, especially student loan and credit card debts.

So what did they do? They made a financial plan to pay off their debts as soon as possible.

And they followed their plan with “gazelle intensity” as Dave Ramsey would say. They got on a crazy strict budget, sold a vehicle, and even downsized their home.

And remember, they were doing all this work so that they could have the opportunity to make LESS money each month.

In their case, just like for Kendall and me, freedom was what their money choices bought them. Or as the growing FIRE movement likes to put it, financial independence.

Reaching their financial goals gave them the freedom to pursue the things that really mattered to them…even if those things weren’t necessarily bigger homes, cars, or retirement accounts.

Whenever the whole “Can money buy happiness?” question comes up, think about these scenarios:

• When you are working at a job that you hate but you can’t leave because of financial obligations and pressures, I’m willing to bet that you are not going to be happy.
• When you feel burdened to help a friend who’s dealing with a financial emergency, but you can’t because it would mean having your lights turned off or being evicted from your home, I’m willing to bet that you are not going to be happy about that.
• On the other hand, when wise financial choices give you the freedom to pursue your passions, this certainly can make you happier.

Honestly, this whole concept is the #1 reason I started this blog.

My goal is for young people to be equipped to make financial decisions that lead to freedom—freedom to do the things that really matter to them throughout their lives.

Conclusion:

The point of this article is not that you should live off of one income for a year or that you should you quit your job in education. These are just examples used to illustrate a larger point.

That point is this: you need to create financial goals today that will enable you to have the life that you want in the future.

Money can’t buy you happiness. That’s true.

But money can keep you from having the freedom to do the things that make you happy.

Maybe that should be the proverb that kids start hearing from the wise adults around them.