In this engaging discussion, Daniel Crosby, a psychologist and Chief Behavioral Officer at Orion Advisor Solutions, delves into the essence of true wealth beyond finances. He highlights how personal fulfillment, relationships, and experiences define real richness in life. Crosby examines the balance between passion projects and profit, and how societal influences can shape our financial behaviors. He emphasizes the importance of delayed gratification and using wealth to enhance life experiences, ultimately advocating for a more holistic approach to personal finance.
Dr. Daniel Crosby advocates for balancing financial wealth with soulful wealth, emphasizing that genuine fulfillment includes relationships and health beyond monetary success.
Crosby introduces the PERMA model, highlighting that true success encompasses Positive Emotion, Engagement, Relationships, Meaning, and Advancement, not just financial metrics.
The podcast reveals that acts of generosity correlate with higher feelings of financial wellbeing and happiness, challenging the belief that self-spending leads to greater joy.
Deep dives
The Balance of Wealth
Dr. Daniel Crosby emphasizes the need to balance financial wealth with soulful wealth in his discussion. He points out that current societal trends show a paradox: despite increased global wealth, many people report feelings of loneliness and disconnection. This suggests that merely achieving financial goals does not equate to happiness or fulfillment. Therefore, Crosby encourages a broader view of wealth, suggesting that fulfilling relationships, health, and how we spend our time are crucial components of a truly rich life.
Redefining Success
Crosby challenges the traditional notion of success, which often equates wealth accumulation with happiness. Instead, he proposes that real wealth includes various elements of human flourishing, encapsulated in a model called PERMA, which stands for Positive Emotion, Engagement, Relationships, Meaning, and Advancement. He cautions that people's fixation on financial numbers can lead to neglecting these significant facets. By fostering engagement and nurturing relationships, individuals can attain a deeper and more lasting sense of success.
The Power of Generosity
The podcast highlights the surprising benefits of generosity, revealing that higher levels of giving correlate strongly with feelings of financial wellness and happiness. Crosby notes that across different economic backgrounds, people who give more tend to feel richer and happier. This contradicts the common belief that spending on oneself brings more joy. Crosby passionately argues that generosity enriches lives and should be embraced as a vital part of being financially healthy.
Understanding Emotions in Finance
Crosby addresses the role of emotions in financial decision-making, rejecting the idea that one must remain unemotional to be successful. He cites research demonstrating that emotions are integral to every decision, including financial ones. When people connected emotionally with their financial goals, such as imagining their family's future, they tended to save more effectively. Crosby suggests that making financial goals visceral and emotionally enticing can significantly enhance saving and investment behaviors.
Taking Incremental Steps
Crosby advocates for an incremental approach to personal finance, encouraging individuals to take small, manageable steps rather than overwhelming themselves with unrealistic goals. He raises the issue of the 'knowing-doing gap,' where individuals often know what they should do but lack the courage to act. Therefore, he emphasizes building on existing strengths and making gradual improvements rather than drastic changes. This sustainable approach allows individuals to cultivate confidence and makes achieving financial goals more attainable.
“Humankind finds itself at a strange crossroads; we know intuitively that true wealth – real wealth, soulful wealth – is about far more than mere money. Yet, far too often, we act as though money is an end unto itself, sacrificing some of the richest parts of our lives in its pursuit.” Quoted directly from Dr. Daniel Crosby’s new book, The Soul of Wealth. Daniel is making a rare, second appearance here on the podcast because when you write multiple fantastic books on investing and personal finance, we’re going to want to have you back on! He’s a psychologist, the Chief Behavioral Officer at Orion Advisor Solutions, and author of many thought-provoking books that are more than just “investing guides.” Listen as we have a great conversation about finding balance between financial wealth and true wealth, all in pursuit of living a good life!
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