There's more to life than your salary

Is there a magical salary figure that you are aspiring to earn some day? And if you ever get there, will it really make you feel happier? Angus Deaton and Daniel Kahneman, both winners of the Nobel Prize in economics, say there is a magic pay cheque number that equals happiness, which, back in 2010 […]

Is there a magical salary figure that you are aspiring to earn some day? And if you ever get there, will it really make you feel happier? Angus Deaton and Daniel Kahneman, both winners of the Nobel Prize in economics, say there is a magic pay cheque number that equals happiness, which, back in 2010 in the United States, they pegged at US$75,000 (Dh275,400). Their research found emotional well-being increases with monetary compensation up to that point, then starts to level off. But they also found that broader satisfaction with your place in the world continues to grow with your earnings.

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This article is part of our supplement on happiness, which unites us all. For more happiness stories visit our dedicated page.

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Caroline Domanska, a “money coach” who practises in the UK and the UAE, has seen many clients in emotional turmoil when it comes to cash. She concludes that the pinnacle of financial happiness is when you no longer have to work to maintain your lifestyle – or, as she explains, “when your financial situation [investments or business interests] can do that for you. You still work, but you choose to work”.

Of course, any magic number for happiness is heavily dependent on who you are and where you’re from.

In his former job as a manager for Dubai Financial Services Authority, Ehsan Parham Al Awadhi, an Emirati, had his sights set on a certain monthly salary. “I thought to myself that once I start earning Dh200,000, then I will have made it in the business world”, he says.

Al Awadhi worked for the authority for almost seven years, but never made it to his magic number, instead taking home, on average, just over Dh45,000 per month. In 2013, he took a one-month filmmaking course, which led to a scholarship with the New York Film Academy. Now, as a freelance filmmaker in Dubai, his earning power is less – but he also spends less, and claims to be much happier.

“As an employee, I was big into tech gadgets – but I was just shopping to fill a hole in my life. When I switched careers, I discovered that I really didn’t need most of those things. Travelling was also my form of escapism. I wanted to totally disconnect and be away from my job, but it wasn’t solving anything. The minute I was back from one holiday, I was already thinking about the next one. Now, I almost have to be dragged into travelling. Because I’d rather be making films.”

Al Awadhi has come to the conclusion that in life, you need as much money as it takes to have the freedom to create what you want. “After that point, money becomes less of a need”, he says.

Abu Becker, a Dubai resident from India, is also happier raking in less money these days. He makes less through his IT solutions company ITAG than he used to as an IT consultant for Morgan Stanley. “My happiness now is that I have more time to spend with my family,” he says. “I have freedom, because I am my own boss.”

Australian May Khizam also made the jump from employee to entrepreneur, when she fo_____

This article is part of our supplement on happiness, which unites us all. For more happiness stories visit our dedicated page.

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This article is part of our supplement on happiness, which unites us all. For more happiness stories visit our dedicated page.

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unded a speaker platform and training company, The Grid Initiative, in Dubai last year. In her former role as director of human resources for an investment bank, the question of how much money is needed to make employees happy often arose.

“Employees are happy if they know they are being paid at the market rate or above, but become very unhappy when they know they’re being paid under,” Khizam asserts. “How much you pay them over that I think is actually negligible – it’s all about the employee feeling validated and having a good boss. People are also happy if they’re always paid slightly more than they were the year before and also when they switch jobs because you always want to think that you’re progressing.”

The Morgan McKinley 2016 UAE salary guide highlights that workers’ take-home pay will remain “broadly flat this year”, indicating that financial happiness could prove elusive for many in the coming months. But if everyone else is in the same boat, will the impact on happiness be less?

Khizan says an added additional layer of complexity exists in the UAE, because the pay scale is frequently dependent on nationality as well as experience. “This can make people become very dissatisfied, depending on how they benchmark themselves against others. I’ve seen cases where an employee will see someone else doing the same job as them for double the salary and they start to feel quite unhappy.”

According to Domanska, it’s important to analyse what motivates us to make money. When we are primarily motivated by fear – which might appear consciously as an overwhelming urge to create financial security – we are never going to be happy, however much we earn.

“When we have a small amount of money, we are afraid of not having enough,” she says. “When we make more money, we fear losing it, or paying taxes, or someone else getting it. The more money you have, the more your expenses rise – which is what creates the feeling of never feeling that much more secure. So if security is your driver, you can have all the nice things in the world, but still feel that you don’t have enough.”

Hermoine Macura, an Australian who runs her company Straight Street Media from New York and Dubai, earns a tidy sum these days, which enables her to lead “a more luxurious lifestyle”, she says. But wealth has had its drawbacks. “As I have made more money, it’s gotten harder to tell who is really my friend. People like me for different reasons now. Genuineness gets harder to detect as you earn more – I am more cautious of people now.”

Macura says that what’s more important than the amount of money you earn is that you live within your means.

“I never took any money from my parents – I had to learn about money the hard way, and that helped me to learn never to spend money faster than I earned it.”

That would have chimed with Charles Dickens, whose father’s imprisonment for debts had a profound effect on the writer’s attitude to money. His character Mr Micawber’s recipe for happiness, in David Copperfield, stands as true today as it did 156 years ago: “Annual income twenty pounds, annual expenditure nineteen pounds nineteen shillings and six pence – result, happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six – result, misery.”

business@thenational.ae

Source: Business

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