Leonard Lauder, son of Estée Lauder, donated 78 cubist paintings to the Metropolitan Museum of Art. Thirty-three of them were by Picasso. Art expert William Acquavella described the donation as “without doubt the most important collection any private person has put together in many, many years. It is fabulous and worth a billion dollars, easily.” [source: Economist]
How did Mr. Lauder acquire such a momentous collection? “Focus, focus, focus,” Mr. Lauder said. “Only buy the best, even if you have to stretch for it.”
I wonder if a financial advisor ever cautioned Mr. Lauder to not spend so much money on art? He’s a billionaire, so probably not.
Financial advisors, like myself, often spend quite a bit of time convincing older clients to reduce spending and warning younger clients about the dangers of lifestyle creep. Saving and cutting down on consumption is necessary for a healthy financial life, but it shouldn’t be done to the point where you are missing out on life and deferring all enjoyment to the future. Especially since our future is never guaranteed.
Nick Maggiulli (@dollarsanddata), in the midst of a tweetstorm, said, “cutting spending to extreme levels only leads to stress and regret. What if you miss a good friend’s wedding to save a few hundred bucks? It isn’t worth it. You only live once, so start learning, grinding, etc. and RAISE YOUR INCOME.”
6 Finally, cutting spending to extreme levels only leads to stress and regret. What if you miss a good friend’s wedding to save a few hundred bucks? It isn’t worth it. You only live once, so start learning, grinding, etc. and RAISE YOUR INCOME.
— Nick Maggiulli (@dollarsanddata) June 22, 2018
I can’t reiterate how true this is. Responsible spending is obviously important, but not to the point where you don’t enjoy your life. Which is more irrational? Someone who mortgages off their retirement years to enjoy the present? Or someone who defers all joys to an uncertain future?
There must be a balance. Do some soul searching to discover what truly brings joy to your life and focus your spending there. Then cut back spending on things that are frivolous.
What is the one thing money can buy that could genuinely increase the quality of your life? Every person has a different answer. I will use the following example since it is what I enjoy. I love to travel and have great experiences. Does a huge house or a luxury car give me the freedom to this? No. So, I choose to forgo a luxury car and huge house despite the temptations of watching my friends purchase these items and focus on what actually makes me happy.
I’d like to point out that there is nothing wrong with focusing on a house or cars. That may be what is important to YOU, and trips across the world have less importance. Having a big house to host out-of-town guests and have parties is certainly understandable if it is your focus and brings joy to your life.
The point is, if you spread yourself too thin you won’t have the ability to achieve the things that truly make you happy. “If you enjoy doing something, never stop. Just keep going,” Mr. Lauder says.
Focus, focus, focus.