As greed continues to be the main driver of new highs in the market, it might be a good time to reflect on why we continue to invest and accumulate wealth. Also, since young, I have been hearing many people fantasize about being a millionaire one day. Enticed to the idea, I myself also bought into the idea that it would be awesome to have a million dollars. At the end of the day, so what if a person did reach a million dollars to his or her name? In today’s post, let’s consider the downsides of being a One Millionaire.
A million dollars is a nice number but it can’t be enough
What I mean is, if you actually worked for a million dollars, you probably would not stop there. Instead, a million will feel like a stepping stone for you in your pursuit of wealth. Also, “what can you really do with a million dollars (SGD) in Singapore?” While it can help to clear off your HDB debt and get you a decent car for sure, I guess that is about it. Yet, it is really difficult for anyone to hit 1 million in cash or liquid asset in this world. Beside risk-takers and successful business owners, shouldn’t the rest of us aim for other forms of success since it will be quite a fruitless goal to aim for a million dollars? This is perhaps something to think about for our younger audience.
A million means you can easily drop below a million
This is what I would refer to as a balance trap. At some point in your life, you would have reached a milestone balance in your bank account. Be it 10 thousand or a hundred thousand, you will be compelled to maintain that level of wealth otherwise why bother to work so hard for that meaningless number on the screen? For those of us who are spending as we earn, you will probably never have such goals, instead, those of us would constantly hope for a windfall in life. The point is that the whole idea of working toward a certain level of wealth might be pointless once you get there, as there is no cap to the amount of wealth one can accumulate. Furthermore, those of us who have accumulated a huge amount of capital in stocks will understand that it will be hard to call it quits and exit the market completely. That means that our monies are potentially trapped in stocks, maybe for our lifetime.
A million dollars hardly mean anything in today’s context
Gone are the days when a million dollars meant you can “do many things you want to do.” In today’s context, you probably know that inflation is constantly raising the bar of contentment in terms of wealth meaning that we are always running towards a goal that is moving farther. That said, the rate at which most of us earn and save still feels like it is an impossible task to accumulate a million dollars. Personally, I do feel that the sweet spot for one’s wealth shouldn’t be defined by a convention or common belief. It should be defined by one’s lifestyle and realism. This is because it will always be wiser to feel happy with X cash balance than unhappy with 100X cash balance in the long run.
Closing Thoughts
I hope that through this post, we can all reconsider our goals and adjust them if it is heading towards the “wrong” direction. Knowing that the accumulation of wealth can be rather tiresome and takes a long time, it might not be worthwhile for some people. As for those who claim to be able to do so in a rather short time frame, perhaps you can also consider how that wealth can truly make a positive impact on those around you when you get there. That way, you will not feel empty and selfish when you have plenty of excesses while others continue to drag their feet to earn their livelihoods.
