By SG Wealth Builder (guest contributor)
I recently read an article on the life of a serial entrepreneur. He was lucky enough to sell off his online business more than a decade ago during the dotcom crisis, landing a huge windfall from the transaction. Overnight, he became a multi-millionaire and could afford not to work for the rest of his life. However, he chose to become a salaried employee and stay on to manage his business for the Board of Directors. This was driven by a passion and love for his work.
Wealth versus Happiness
Many people think that wealth brings happiness. But being rich can only make you happy up to a certain point. Beyond this point, more money doesn’t make you happier. Instead, you become numb from the lavish spending, deriving no joy in material well-being
In fact, a sudden windfall may even make you lose sight of your dreams and ambitions. After all, if you have more than enough money not to work a single day for the rest of your life, what is your next goal?
A life without aims and challenges will not be meaningful; you will instead simply be wasting away your life, consumed by money itself.
Wealth and Happiness
We have heard of people who receive huge windfalls from the lottery, but lose everything in a few years. Typically, these people do not know how to manage wealth sensibly. They do not know how to invest wisely and preserve their wealth. They have no concept of personal finance management.
The sudden wealth is instead spent foolishly on material goods, such as cars and houses, or through imprudent lending to friends and relatives. It’s a shame to read such articles, as the windfall could have been put to better use such as supporting charitable causes and helping the less fortunate. But when the pot of gold lands with someone who poor in financial management, it’s always a case of “easy come easy go”.
Therefore the key to wealth management is to have a plan on the ways to manage a sudden windfall. A portion will definitely be spent, but there is also a need to invest and preserve a greater proportion of that wealth.
Most importantly, good psychological and physical health is needed to enjoy the wealth.
By guest contributor SG Web Reviews, a Singapore blog on business ideas. Posted via www.MoneyMatters.sg, your guide on how to make more money, save smarter, invest intelligently, and enjoy your money like a pro. Click here to get our free report on what you must know about financial freedom.