In Pursuit of Wealth

What is Wealth & Why Should We Want It?

I am not here to teach you how to boost your income or build a business. There is plenty of content around the “how” of raking in dollars, and frankly that’s not my expertise.

I did earn and invest enough as a private banker to retire from that career at 40. And while I remain a spreadsheet junkie who will happily debate safe withdrawal rates with fellow finance nerds, I don’t want to help optimize your portfolio either. Investments are increasingly managed quite well by algorithms (even if you think you’re paying a human to do it).

But I do want to talk about wealth. Advising and observing hundreds of America’s richest families over the last twenty years has expanded my understanding of how wealth impacts individuals, families and society. Beyond wielding it to reach (allegedly) quantifiable goals like retirement, I am interested in exploring the less tangible aspects of wealth.

How does your relationship with work evolve after you’ve reached your financial goals? How does financial independence impact the power dynamic in relationships? How can you use money effectively to create a life you love?

And beyond our personal aspirations, what is the purpose of wealth?

What is Wealth?

Much of our cultural narrative is centered around the pursuit of money and everything that is supposed to come with it: power, glamour, sex, fame. Or at least a nice home, regular vacations and the ability to DoorDash dinner without your chest tightening with anxiety.

The American Dream is all about climbing the socio-economic ladder, and those who don’t are alternately ignored, blamed or pitied. Just make sure not to get too rich, or else you’ll automatically grow a green aura of evil, greed and oppression.

First, some definitions:

Money:

Any circulating medium of exchange, including coins, paper money, and demand deposits.

Money is technically just a tool; it doesn’t have intrinsic value. You may realize this when you travel abroad and find your dollars worthless, or if you discover some foreign coins in the bottom of a travel bag and can’t use or deposit them anywhere.

Wealth:

1) A great quantity or store of money, valuable possessions, property, or other riches.

2) An abundance or profusion of anything; plentiful amount.

Being wealthy generally means you have a lot of money, but wealth is a broader and more subjective idea; under the “anything” category, it could refer to an abundance of time, friends, food, or knowledge.

I use the term wealth to refer to an amount of money that affords you a general level of comfort and freedom.

Freedom:

The power to determine action without restraint.

The price of freedom depends on a multitude of variables the internet money police love to debate. You can achieve it with a net worth near zero if you have no fixed costs, a good pension or access to a family trust. In many areas it can take millions to maintain an average home and lifestyle indefinitely.

In any case, having “wealth” implies freedom from the obligation to work. There’s a reason the pinnacle of the money goals hierarchy is often referred to as “financial independence.”

Independence:

Freedom from the control, influence or support of others.

Wealth suggests access to more than just money. Time is the ultimate resource, and having an abundance of it to do as you please is a defining feature of the wealthy across history (the “as you please” part applying primarily to men, of course).

Poor people have always been chained to their jobs, sometimes literally, while wealthy people were free to read, travel, invent and discover things, run for office, create art, and spend time with family.

Or drink, gamble, and invade a nearby village, as the case may be.

Why Should We Want It?

Freedom sounds great and all, but to what end? Do you really need to spend years earning as much as possible and spending much less than you make for the sake of building wealth?

In short - no. I don’t believe building wealth needs to be a universal goal (though typing that feels like heresy after spending most of my life submerged in the personal finance community).

Some vocations are more important than money, and many people lead fulfilling lives without accumulating wealth. And thank goodness: we all benefit from the valuable but less lucrative labor of ministers, artists, public servants and nonprofit workers.

But someone’s wealth enables that work. The taxpayers and donors who fund it get to dictate the terms of service. Business owners and shareholders similarly control their employees. In our capitalist society wealth isn’t just freedom: it’s power.

Those who have it influence everything from the media to public policy. That may sound diabolical, but we all get to vote with our dollars. The more people with wealth, the more evenly distributed the power. We all have a voice, but money is a really effective amplifier.

There are those who lack the ability to build wealth, but many waste the opportunity, needlessly sacrificing future freedom and power. They may still live comfortable lives in gilded cages, but some later regret it when they realize they are trapped in a job or marriage (or when unexpectedly ejected from it).

I’ve never been more grateful for prioritizing wealth than during my divorce. It was still stressful, but having that part of my life under control helped me feel secure and empowered. For the first time I shifted my attention from saving for the nebulous future to actually using my resources to design a new, authentic life.

The Next Phase of the Journey

Wealth enables us to move past survival mode and invest in whatever we value. Individual freedom is a worthy goal, but your highest purpose probably isn’t just to retire early and travel in style (though to be clear, those were big motivations for me).

Wealth provides the opportunity and the responsibility to create meaningful change. It changes us too, whether our impulse is to hoard it, spend it, or give it all away. Wealth alters our psychology, influences family dynamics, builds (or divides) communities, shapes culture, and drives political systems.

Whether you are currently building it, living off it, looking forward to inheriting it, or hopelessly longing for it, wealth is a powerful and inescapable force in our society. I spent the first half of my life pursuing it. Now I’m exploring what it means to use it well.

I hope you’ll join me.

Yours in Wealth,

Elizabeth