Gretchen Rubin

“Money Certainly Cannot Buy Happiness, But It Can Buy Comfort, Choices, and Freedom.”

“Money Certainly Cannot Buy Happiness, But It Can Buy Comfort, Choices, and Freedom.”

Interview: Danielle Town.

The relationship between money and happiness is one of the most complex and emotionally charged topics within the larger subject of happiness.

Danielle Town has written a memoir that takes the reader through her efforts to gain greater control over money and investing -- and with it, a sense of greater control of her life. Over the course of a year (I do love any one-year project!) she teaches herself how to invest wisely.

This memoir is just hitting the shelves: Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad).

Many of us don't even like to think about money, but Danielle Town explains why we're happier if we confront our fears, anxieties, desires, and habits related to saving, spending, and investing.

I couldn’t wait to talk to Danielle about the relationships among happiness, habits, money, and relationships.

Gretchen: You’ve written a wonderful memoir about learning investing that is, in many ways, really about happiness. For many people, money problems are huge obstacle to their happiness. Do you connect money and happiness? Do you think money can buy happiness?

Danielle: Money certainly cannot buy happiness, but it can buy comfort, choices and freedom. Which, for a lot of us, would feel like a lot like happiness. It's funny how wealth is like health - when you don't have it, it's all you think about; when you do have it, life is just easier. Feeling free financially removes stress and creates the space to focus on the important things that actually do create real and lasting happiness: the choice to work part-time, the ability to support wonderful charities, the peace of knowing your student loans are paid off or your kids have college covered – whatever financial freedom looks like for each of us. And I was forced into learning about financial stuff, so I know it’s not a happy topic for many of us, but it turned into a source of happiness for me.

Gretchen: You’ve gone through a fascinating journey and education. What has surprised or intrigued you – or other people -- most?

Danielle: It surprised me how much old childhood emotions around money shaped how I think about my finances to this day. Every single person has a framework of money and wealth from their childhood; every one of us, regardless of how much or little we and our family had, had an experience with money growing up. However, we probably didn’t realize or notice it until we got older, because it’s only once we’re older and see how other people handle money that we have any perspective on our own experience. Once I was several months into learning investing, I just couldn’t quite fully imagine myself as a successful investor, and I couldn’t figure out why. Finally, I realized it was because I didn’t completely trust my dad. Which is, on its face, ridiculous: my dad is a well-respected investor who has been investing for thirty years. So I looked deeper, and it went back to when I was a kid. My parents divorced when I was eleven, and my experience was that my dad left and took the money with him, and it was awful. But he came back, and we repaired our relationship, and until I started learning investing from him I would have told you that the childhood trauma was all in the past. It wasn’t. It forced us to talk about it, and for the first time in my life, I heard his perspective on the situation and, as an adult, I could see his point of view and his choices in a way I couldn’t have when I was a kid. Working through it released me from some of its effects, while at the same time, that was my experience and I will always need to be aware of how it’s affecting me as an investor.

Usually as soon as I start talking about childhood experiences with money with people, they flash back immediately and they know exactly what shaped them. It’s extraordinary how it’s right there, present, but we avoid it for years because it’s uncomfortable or painful – which is completely logical, actually, to avoid something that brings pain. However, by avoiding it, we’re compounding the pain by bringing money stress on ourselves, and I believe we have to think about it, transform it, and go forward with that information about ourselves to take our power back.

Gretchen: Would you describe yourself as an Upholder, a Questioner, a Rebel, or an Obliger?

Danielle: When I initially read Better than Before, I thought I was a Rebel because I absolutely love the feeling of not doing something I’m expected to do. It used to give me huge amounts of pleasure to, for example, cut class in school – but only when it was a class I knew was unnecessary and skipping it wouldn’t hurt. However, at the same time, I really care about the expectations of others and don’t want to let anyone down, right up until it gets to be too much and then I tend to shut down. So I wasn’t quite sure how I fit into the framework. But then, when I read The Four Tendencies, and discovered that you had identified a subset of Obliger that is also a Rebel, I felt seen. I distinctly remember reading your book on an airplane and, when I read that section, I flashed back to when I started looking into my Investing Practice – I think I was deep in Obliger-rebellion, overwhelmed at work, and trying to find a way out while still being able to pay my bills.

Gretchen: What’s something you know now that pushed you towards building healthy habits or happiness, which you didn’t know when you were 18 years old?

Danielle: I didn’t know inflation was destroying my savings without me doing anything wrong! Finding that out changed everything, and pushed me towards building the habit of my Investing Practice, which has created so much happiness in my life. It probably sounds ridiculous to those who are aware of it, but did you know that inflation reduces the buying power of your savings? I didn’t know that, because I had never connected inflation to my own personal money like that. I thought savings were incredibly safe, but they’re not safe from inflation.

Inflation on average is 3% per year. Which means that just to stay even, just to keep my money and not lose it, I have to get 3% per year on my money. No one had EVER told me that. It still blows me away. Why don’t they teach this stuff in school? And I have a father who is a long-term value investor, and I didn’t know. So when I found that out, I knew had to do something with my money simply to not lose it, and I still hemmed and hawed and tried to avoid learning how to invest. I’m such a reluctant investor. Investing is often scary, volatile, and emotional. Of course it is - we get virtually no financial education but live in an incredibly complex financial world. But now my practice of investing - which I treat as a practice, just like yoga or meditation – has, surprisingly, become such a wonderful part of my life because it’s not really about making money. Money is a nice byproduct. But the real reward is in the learning, studying, and appreciating knowing so much more about my world around me, and then getting to make a difference by voting for my values with my investing dollars.

Gretchen: How does bringing your values into your Investing Practice make you happier?

Danielle: It makes me feel like a joyful warrior – who knew investing could do that? My money is a vote, and if it’s in the market, it’s being voted – even if I didn’t choose the companies my money supports. That vote still counts. Which means that if I’m not choosing the companies my money supports because it’s in a fund or index, it probably is literally helping companies do things I hate – polluting, hurting animals, treating employees poorly, just to name a few things that are important to me to avoid. Once I took my power back and started voting my money myself in wonderful companies for the long-term, it made the process of learning about investing in the markets so much more interesting, because now it’s personal. We little investors control so much of the market that, if we all voted consciously with our money, we literally could change the entire market. If we took our money out of companies doing terrible things, those companies would change or die, quickly. They really would. Within a year, probably. We have so much power, and we have the skills, we just need a bit of knowledge about how to use it. It makes me happy to use it for good.

Gretchen: What’s a simple habit or activity that consistently makes you happier?

Danielle: Meditating. I’ve practiced Transcendental Meditation since I was ten years old, and it consistently reduces my stress and gives me an experience of stillness that I draw on in many situations outside of meditation. Knowing that I have that experience inside me, no matter what, gives me the groundedness to be brave and take leaps like quitting my law firm job and moving to another country.

Gretchen: Do you have any habits that continually get in the way of your happiness?

Danielle: Staying up late is a terrible habit of mine. Lack of sleep really negatively affects me. After a string of days of little sleep, I get pessimistic and down and start feeling depressed. Someone called out that connection between sleep and getting pessimistic for me a few years ago, and it was really helpful to be made aware of it. Now, I try to notice those negative thoughts instead of being consumed by them, and review whether I’ve been sleeping enough, and I almost always haven’t been. It’s pretty amazing how much rosier the world looks in the morning after a night of great sleep.

Gretchen: Have you ever been hit by a lightning bolt, where you made a major change very suddenly, as a consequence of reading a book, a conversation with a friend, a milestone birthday, a health scare, etc.?

Danielle: I am extremely introverted, which means that people pull energy from me instead of giving energy to me. Not a bad thing, just how it is. I had always felt uncomfortable about being introverted, but reading Susan Cain’s book Quiet was a life-changing lightning bolt that made me realize it was ok to be me – or, as you would put it, to Be Danielle. Her research proves it’s not only ok to be introverted, it’s beneficial in many ways. Our world is not particularly conducive to introversion, though. I remember being called ‘shy’ in a derogatory way when I was a kid and being constantly pushed to be around people. My respite after a long day at school was to come home and get to read alone in my room, and I remember one afternoon my mom asked me, “Why don’t you make plans to play with your friends after school?” All at once it occurred to me for the first time that that was something the other kids did, so I was different, and also, I didn’t want to do that at all. After all, I had just spent all day with those friends. But I tried to be “normal” and more social and carried that effort with me my whole life. So reading Quiet, as a 35-year-old attorney, taught me more about myself than I could have imagined. I understood why I went into law – because I loved getting to spend long hours thinking out an agreement or problem – and why I was miserable in my legal practice – because we didn’t have long hours to think; work had to be done quickly and while being constantly pulled away to answer emails within a few minutes of them arriving and juggle clients. I realized that’s probably why many lawyers are unhappy. We go into it for the intellectual challenge and deep thought, and come out of it into a peripatetic job managing the constant needs of others. The two don’t match up. I started thinking seriously about my future and how to structure my life so that it fit me, instead of me trying to fit it.

Gretchen: Is there a particular motto or saying that you’ve found very helpful? (e.g., I remind myself to “Be Gretchen.”) Or a quotation that has struck you as particularly insightful? Or a particular book that has stayed with you?

Danielle: I remind myself to be thankful for my problems. I struggle with gratefulness practice because it feels a bit forced to me, and I don’t like that feeling. But noticing my problems and being thankful for them – that they’re not bigger, that there might be a silver lining to them, that they show me what’s important to me – is simply noticing reality and shifting perspective a little bit. There was an investor in Japan, Wahei Takeda, who was often called the Warren Buffett of Japan, and he actually required that the companies he invested in have thankfulness as an institutional practice. If they refused, he pulled his money out. I think it showed him whether the people running those companies shared his values or not, and he didn’t want to be supporting a company of people who didn’t share his values. And neither do I.

icon schooled

One Last Thing

Want to harness self-knowledge to create the life you want?

Sign up for the waitlist for my new Four Tendencies course. Registration opens on May 1 for a limited time. If you're on the waitlist, you'll have the chance to get access with the early bird discount.

Join the waitlist