I don’t think money makes you happy. I know a lot of people believe it will, and we’re constantly surrounded by messages that suggest life will somehow be better when we earn more, have a bigger house, drive a nicer car or have more sitting in our investments, but I genuinely don’t think it works like that.

That’s not to say money doesn’t matter, because of course it does. I think you need a certain level of money to be okay and, more importantly, to feel secure. If you look at Maslow’s hierarchy of needs, after our basic physiological needs – food, water, sleep, shelter and the things we physically need to survive – comes safety. That includes having somewhere safe to live, physical security and financial stability.

Money plays a huge part in that. It keeps the house warm, pays the mortgage or rent and gives you a buffer when something unexpected happens. It gives you choices and, perhaps most importantly, it can give you peace of mind. If you’ve ever worried about money, you’ll know how quickly that worry can creep into everything else. It can keep you awake at night, affect your relationships and make even relatively small unexpected expenses feel enormous. Money worries can put a huge amount of pressure on relationships, so it would be ridiculous for me to sit here and tell you that money isn’t important. It absolutely is.

But I think there’s a big difference between having enough money to feel financially secure and believing that more money will make you happier. Once your basic needs are met and you have that security around you, does earning another £10,000 really make you happier? Does having another £100,000 invested make you a happier person? Maybe it gives you more options and makes certain things easier, but I’m not convinced it changes how you fundamentally feel about your life or yourself.

But have you noticed how often, when you finally get there, the number changes? The £50,000 salary becomes £75,000. The £500,000 house becomes the £750,000 house. The £500,000 pension becomes £1 million. There’s always somebody with more and there’s always another milestone you could chase. If happiness is permanently attached to the next financial goal, you could spend your entire life waiting to arrive somewhere that doesn’t actually exist.

And if you want evidence that money alone doesn’t create happiness, just look around you. There are people with very little who are genuinely happy and there are billionaires who are deeply unhappy. There are celebrities who seem to have everything – money, beautiful homes, incredible holidays, successful careers and complete financial freedom – yet still struggle with anxiety, depression or loneliness. There are children who have grown up surrounded by enormous wealth who struggle with their mental health, and there are people living perfectly ordinary lives who wake up feeling grateful for what they have. So clearly there is something else going on.

Money can buy comfort. It can buy freedom. It can buy opportunities, experiences and time. It might allow you to retire earlier, work fewer hours, travel more, help your children or simply stop worrying about what would happen if the boiler broke tomorrow. And those things are hugely valuable. In fact, I think that’s when money is at its most powerful – when you use it to support the life you actually want to live rather than simply trying to accumulate more of it.

But money can’t buy purpose. It can’t buy genuine friendships or meaningful relationships. It can’t make you like yourself. It can’t give you self-worth, gratitude or inner peace. Those things come from within and from the way you live your life.

That’s why I think one of the biggest financial mistakes we can make is believing that happiness is waiting for us on the other side of the next pay rise, the bigger house or the larger investment portfolio. Ask yourself what you’re actually hoping will change when you get there. Will you feel different? Will you suddenly feel successful enough? Will you finally stop comparing yourself with other people? Or is there a chance you’ll simply move the goalposts again?

For me, this is also what good financial planning should really be about. It shouldn’t just be about accumulating as much money as you possibly can. There will always be a bigger number. It should be about understanding what enough looks like for you and then using your money to create the security, freedom and choices that allow you to live your life.

Instead of always asking yourself, “How can I have more?”, perhaps the better question is, “What do I actually want my money to help me achieve?”

Because you don’t want to spend your whole life building wealth for a future version of yourself and forget to enjoy the life you have now. Yes, save. Invest. Plan for your future and give yourself financial security. Money is incredibly important and having enough of it can bring a huge amount of peace of mind.

But don’t expect it to create happiness for you. That part has to come from somewhere else.

Money is an incredibly useful tool. Just don’t ask it to do a job it was never designed to do. 🩷