Many individuals fantasize about attaining wealth, as I’ve previously mentioned. While most people may not primarily be driven by financial goals, the desire to amass riches persists among a significant portion of the population.
However, it’s important to understand that the wealth you accumulate is more than just a score in a video game. It will change everything about how you look at the world around you.
Case in point: A friend of mine had the opportunity to talk with an extremely wealthy person, a billionaire, and he asked him: “What is it like to be a billionaire?”
In response, the billionaire said: “Everything is free.”
While that might seem like a crazy response, it’s worth unpacking what he meant by it.
Levels of Price Insensitivity
As someone accumulates wealth, they become unchained to some things that you and I might take for granted. For example, when we go to the supermarket, we might be hypersensitive–especially these days–to the cost of staple items like milk and eggs. If we operate with a household budget, any fluctuation, let alone one of a few dollars, can drive you nuts.
But, if you’ve made some money in your life, say a few million dollars, you’re not as likely to be sensitive to changes in the price of eggs. You’ll likely buy whatever you want from the supermarket without considering the price tag. Whether something is $3 or $10, it doesn’t matter, given the context of your wealth.
That same principle holds the wealthier you are. At a certain point, when you’ve accumulated several million dollars, you begin to ignore the price tags on fancy clothes–and maybe even cars.
You’ve got enough money to buy whatever you want, so you do.
Making the Most of One’s Time
Going from someone with several million dollars to someone with a billion dollars involves many more zeroes. And all those zeros mean that, from a consumer point of view, you can buy anything you want–from cars to houses and first-class international trips. Price is no longer on your radar.
But another change as you accumulate wealth is that your time becomes more valuable. Your priority becomes preserving and not wasting your time.
Someone who, earlier in their life, might have spent a day wallpapering their bathroom–including shopping for all the supplies at Home Depot–might simply hire someone to do the work instead, because they’d rather do something else with their time.
As your wealth increases, you can afford to throw money at a problem rather than yourself.
When you’re hugely wealthy, that ratio of how much money you’re willing to trade for your time goes up exponentially.
For example, I have a client with a fleet of custom vans outfitted like his office. He aims to be productive every minute he is traveling somewhere–which also means he hires a driver so he can answer phone calls or work on his spreadsheets. Sure, it’s expensive. But he sees it as an investment in his time.
That’s also why so many uber-wealthy people own planes or travel by private plane. They would rather pay than deal with TSA lines or delays. Flying becomes no different than hiring a private car.
Fun fact: Warren Buffet’s plane is named Unjustifiable. While that might be true for most of us, it’s completely justifiable for Mr. Buffet, who values his time and is willing to pay big money to get back more of it.
From Things to Experiences
Another thing that happens when you accumulate wealth is gaining freedom of action. You can essentially do whatever you want to do. You can outsource anything you don’t want to do and eliminate it from your life.
Conversely, when price no longer matters, you value experiences more than things. That means you can seek experiences with your family and friends, because they are far more valuable than anything else.
A wealthy friend wanted to take his family and friends on a safari. Now, that’s a trip just about anyone can make with a budget of a few thousand dollars. But my friend treated this like the once-in-a-lifetime experience it was. The itinerary he booked cost $100,000 a person.
That was well beyond my economic level, but he wanted to use his wealth to create an experience neither he nor his friends and family would ever forget.
The final area where your view of the world changes when you accumulate wealth is that you can affect change or create an impact on a much bigger scale.
For instance, people of moderate wealth might consider buying an income-producing asset like a stock, bonds, or rental property. A truly wealthy person, on the other hand, might buy a company (or two) or something like a mine in South America. A highly wealthy person thinks at a whole different scale about the realm of possibilities before them.
Wealthy people can also bring about profound societal impacts through the scale of their giving and philanthropy at a level that most regular folks can’t fathom. Think about Bill Gates and how he has impacted the health of millions of people worldwide at a scale that might be compared to a nation-state. Even the world of politics is dominated by people like the Koch brothers and George Soros, whose political donations can sway elections.
Wealthy people make a difference–which is why wealth is not just a number. It completely changes how you live your life. And that’s OK–just know the stakes of the game that you’re playing.
It might be worth considering some of our choices for money, and perhaps more focus on time, experiences, and impact could be more rewarding.