The recent forays of billionaires into space have proven that if you want something badly enough, and you have the money, you can probably buy it.

Material belongings and once-in-a-lifetime experiences are certainly desirable and being financially stable can help you attain them. But what about more intangible aspirations, like future happiness?

As you accumulate wealth during your career, you’ll probably have some thoughts about the retirement lifestyle you’d like. And – if we have done our part correctly – you’ll have an idea of how much that lifestyle is likely to cost.

So what is the price for your future happiness? Can money help to make you happier? And can too much money alter your attitude to risk?

Keep reading to find out.

The billionaire space race provides a glimpse into the aspirations of the super-rich

In August, Richard Branson’s Virgin Galactic VSS Unity took its first crew of tourists to the edge of space. 

Among those onboard were 80-year-old Jon Goodwin, the first Olympian in space, and Keisha Schahaff and Anastasia Mayers, the first mother and daughter. 

Branson’s space tourism company competes with those of two other billionaires, Elon Musk’s SpaceX, and Jeff Bezos’s Blue Origin.

It seems that humans, and more specifically, the super-rich are drawn to dangerous environments. 

Whether these endeavours are an addiction to adrenaline, a need to assert control or a quest for inner peace, is hard to say.

According to Dr Adele Doran of Sheffield Hallam University (speaking to Sky News), some of these risk-takers are control freaks rather than adrenaline junkies. 

Business psychologist, Lee Chambers, meanwhile, suggests that the lack of financial consequences for the super-rich can lead to an “erosion of perspective” and “dulled risk perception”.

Of the three billionaires in charge of space tourism companies, only Elon Musk has yet to enter orbit. He will only be happy once he has used his SpaceX to send people to – and then colonise – Mars, possibly beginning as early as 2025! 

Studies disagree on whether there is a limit to how much “happiness” money can buy

In 2010, Princeton University professors and Nobel laureates, Daniel Kahneman and Angus Deaton conducted a groundbreaking study into whether money equals happiness.

They found that wellbeing rose with increasing salaries but plateaued once income reached $75,000 (around £54,000).

The report suggested that money could indeed buy you happiness… up to a point.

Kahneman and Deaton used emotional wellbeing as their marker. This looked at daily instances of joy, stress, and anger, and the intensity of these emotions. They also looked at “life evaluation”, or the feelings people have when they think about their life.

In 2013, a study by the Centre for Economic Policy Research (CEPR), looked at overall life satisfaction and suggested that there was no upper limit monetary limit. It found that increased wealth continued to improve happiness without plateauing. 

Finally, cutting to March 2023, a new collaborative study has seen Kahneman and Deaton revisit their own paper. In partnership with Michael Killingsworth – Senior Fellow at the University of Pennsylvania and a sceptic of the original study – this new research gives a more nuanced answer to the age-old question.

They found that “money can keep buying happiness for already happy people, but among the most unhappy, the money helps stave off unhappiness only to a point.”

Concentrating on wealth and happiness combined (or “financial wellbeing”) is key

Financial wellbeing could be key to balancing money and happiness. It weighs your long-term money aims and the things that make you happy now, with what is likely to make you happy in the future.

That means thinking about:

• Providing yourself with a secure income
• Maintaining a safety net against the unexpected
• Building long-term savings aligned with your goals.

You’ll also need to think about how these financial factors fit into your wellbeing. That means:

• Being clear about your long-term plans and what makes you happy
• Managing this happiness in the present without damaging or jeopardising your future lifestyle
• Setting realistic goals and points of comparison to ensure your dreams remain attainable.

Putting a long-term financial plan in place is the perfect way to start thinking about what you want your life after work to look like.

Once you have an idea of your dream retirement, you’ll know how much it costs and will have a definite goal to work towards.

We’ll keep in touch to ensure that you remain on track.

Balancing risk and reward is key to achieving your long-term aims

Which? recently revised its retirement income targets. It surveyed more than 5,000 retirees and semi-retirees to ascertain the average income required for different levels of retirement.

Source: Which?

A couple looking for a luxury lifestyle will need an annual household income of around £44,000 according to Which? calculations. 

A “luxury” retirement is defined as sufficient money to cover essentials like food, your mortgage, and bills, alongside (among other things) recreation and leisure activities, gifts to family, long-haul holidays, and a new car every five years.

Being able to afford these non-essentials will play a big role in your financial wellbeing and overall happiness, helping you to look after your mental and physical health.

Getting to this point will require a robust plan, patience, and a focus on your goal in the face of market fluctuations and global events.

It will also require a balancing act of risk versus reward.

Get in touch

Your dream retirement might not involve life on Mars, but you’ll want to ensure you have sufficient funds to be happy. 

With decades of experience, our Chartered Financial Planners have the expertise to help you plan your retirement your way. If you have any questions, please get in touch and speak to us today.

Please note

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.