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The fulfillment curve...
Old 09-18-2010, 10:35 AM   #1
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The fulfillment curve...

Hello everyone - I found this curve on the internet this morning (reference : Get Rich Slowly - Personal Finance That Makes Cents). Found it interesting, would like to share it. The overconsumption part of the curve seems to correlate with competition, stress and "other sorry outcomes"...

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Old 09-18-2010, 10:43 AM   #2
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One person's "overconsumption" is simply another person's perceived basic needs.

If one would look at Maslow's hierarchy of needs, you would see that the top of the pyramid does not reach beyond "infinity" (as your chart shows).

My own interpretation? We can never go beyond infinity (e.g. cross over to the downward slope). If we do, that's the view of others - not ourselves.

Your chart shows the view of others, not of self-actualization…
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Old 09-18-2010, 10:46 AM   #3
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IIRC, it's originally from the 'Transforming Your Relationship with Money' tape set, later written up in book form 'Your Money or Your Life'. Interesting read, long on philosophy but short on personal finance. Same folks are at this website.

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Old 09-18-2010, 11:06 AM   #4
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Originally Posted by rescueme View Post
One person's "overconsumption" is simply another person's perceived basic needs.

If one would look at Maslow's hierarchy of needs, you would see that the top of the pyramid does not reach beyond "infinity" (as your chart shows).

My own interpretation? We can never go beyond infinity (e.g. cross over to the downward slope). If we do, that's the view of others - not ourselves.

Your chart shows the view of others, not of self-actualization…
Your chart shows the view of others, not of self-actualization…

Do you mean how one person observes another's behavior? If so, I agree.
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Old 09-18-2010, 11:15 AM   #5
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Do you mean how one person observes another's behavior? If so, I agree.
That's exactly what I'm trying to say (even if my words did not )...
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Old 09-18-2010, 11:30 AM   #6
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Old 09-18-2010, 11:35 AM   #7
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What Kenny did, right?
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Old 09-18-2010, 11:45 AM   #8
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What Kenny did, right?
I think he did, after being talked to by Harry Chapin.
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Old 09-18-2010, 01:33 PM   #9
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I think this is exactly right. Enough varies from person to person, but we all have an enough. Our goal is "a modest, ordinary life" - though it's relative to our past spending and meaningless to anyone else.

Unfortunately, most people I know still seem to think more money equals more happiness...
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Old 09-18-2010, 02:54 PM   #10
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I think he did, after being talked to by Harry Chapin.
Before or after Harry died.
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Old 09-18-2010, 07:50 PM   #11
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It's possible that I don't understand what the curve is saying but it seems to implicitly conflict with studies that show that happiness peaks at a certain level of income.

The curve says that fulfillment continues to rise until we have "enough" but does not define what is "enough" - presumably on the basis that what amounts to "enough" will vary from person to person which means that the curve is saying that some people may achieve maximim fulfillment at higher levels than others - rather than everyone more or less maxing out at a given level of consumption.

Now I accpet that "fulfillment" and "happiness" are not the same thing, but they are close enough. Likewise, this chart is about consumption and the happiness studies are about income, but given that income and comsumption are highly correlated, the comparison is still a valid one (IMHO).

So how should we reconcile the two studies?

PS - I agree with the position taken that fulfillment does peak at some point and that consumption beyond "enough" is unlikely to add much, if anything, to quality of life etc.
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Old 09-19-2010, 06:26 AM   #12
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Thank you TraineeInvestor. Please could you kindly provide references that may contradict the findings from the fulfillment curve ? I am new to all this but interested in learning. Thank you.

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studies that show that happiness peaks at a certain level of income.
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Old 09-19-2010, 06:35 AM   #13
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Thank you TraineeInvestor. Please could you kindly provide references that may contradict the findings from the fulfillment curve ? I am new to all this but interested in learning. Thank you.
There was a recent thread on this forum: Day to day happiness peaks at $75k?

As mentioned, I accept that it is not an apples to apples comparison but they are close enough that I struggle to reconcile the two conclusions.
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Old 09-19-2010, 06:50 AM   #14
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You bring a good point TraineeInvestor. Maybe "overconsumption" is the key added dimension. 'Overconsumption" may be perceived as reducing fulfillment in life. At the same time, I do not think those posting in the thread you mention always see themselves as "overconsumers" (they have reached a "plateau"), hence they feel happier (or leading more fulfilling lives). Does this make sense ?

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There was a recent thread on this forum: Day to day happiness peaks at $75k?

As mentioned, I accept that it is not an apples to apples comparison but they are close enough that I struggle to reconcile the two conclusions.
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Old 09-19-2010, 08:05 AM   #15
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Originally Posted by obgyn65 View Post
You bring a good point TraineeInvestor. Maybe "overconsumption" is the key added dimension. 'Overconsumption" may be perceived as reducing fulfillment in life. At the same time, I do not think those posting in the thread you mention always see themselves as "overconsumers" (they have reached a "plateau"), hence they feel happier (or leading more fulfilling lives). Does this make sense ?
Old hat to this crowd but though it does seem counterintuitive to most people, it's not. Overconsumption can indeed reduce fulfillment/happiness - maintaining a life of excess can be more of a headache (and expense) than any (fleeting) fulfillment the excesses provide. Ask anyone who has gone thru decluttering/simplifying/downsizing their lives - it's a revelation. Most people buy stuff, it makes them happy for a while and then wanes, and they just buy more stuff and the cycle goes on endlessly. Never happy but for a moment. It's a pattern Americans have gotten particularly good at, thanks to Madison Ave etc. And it's also the reason no one labels themselves as overconsumers, even if they're way past "enough."

I'm giving a highly simplified example because it's preaching to the choir here. The chart is conceptually right IMO. Read Your Money or Your Life or The Millionaire Next Door - one day their messages make sense to most people though they're not mainstream thinking.

To the point of enough varies from person to person, a big part of it to me is cost of living. I don't think the difference in actual activities, possessions etc. varies as much as the relative cost between say living in NYC, NY vs some of the very low cost areas of the USA or other countries.
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Old 09-19-2010, 11:23 AM   #16
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The curve says that fulfillment continues to rise until we have "enough" but does not define what is "enough" - presumably on the basis that what amounts to "enough" will vary from person to person which means that the curve is saying that some people may achieve maximim fulfillment at higher levels than others - rather than everyone more or less maxing out at a given level of consumption.
I think that you can look at the chart as not being so much subjective as allocating for different costs of living. That is, it seems to say that when you have just enough to afford some luxuries is the top. You could afford one Corvette but don't have enough to just go buy 10 of them.

On the other hand the income or assets it would require to get that point might be very different in different parts of the world.

All of that said, I don't think that everyone agrees on what is a necessity and what is a luxury.
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Old 09-19-2010, 01:14 PM   #17
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That curve is straight out of "Your Nobey or Your Life". These type curves are discussed ad nauseum in that book.

And it's not the income that limit's your happiness. It's what you have to give up and what you have to do to get that income that limits you happiness
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Old 09-19-2010, 01:24 PM   #18
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I think "enough" is a mentality. For some folks, it takes little to feel like they have "enough". For others, they never have "enough".

An interesting experience for me when I had enough company stock to feel FI and that retirement was a real possibility. Some folks, like me, retired when they could easily support their current lifestyle plus a little extra for travel or upgrade home or whatever.

Other folks had more grandiose ideas. One of my colleagues who probably had 2x what I did, was too busy building his enormous mansion on the lake. I think he had half his net worth on margin to finance that. So he wasn't ready to retire. He didn't like staying home with the kids anyway - so that also motivated him to keep working.

I remember another (more junior) guy at work remarking that it was easy for me to retire because "I had never developed expensive tastes" or something along those lines. In other words, I could retire early, because I was happy with "less". I got the feeling he needed to be able to show off his wealth (whenever he finally achieved it).

I know with certainly that feeling like I had "enough" was definitely part of the motivation to retire early. I wasn't willing to "hold out for more".

Audrey

P.S. Actually, I do have expensive taste. I definitely enjoy top quality things and food, wine, whatever. I just am very happy with small doses which do not break the bank. I am just not into toys or fancy houses or conspicuous consumption. That saves a lot of money!! It kept me out of debt most of my working life, and it made it much easier to reach FI!
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Old 09-19-2010, 01:56 PM   #19
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Some people equate money = power over others. People who like power can never get enough of it.

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Old 09-19-2010, 02:01 PM   #20
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Some people equate money = power over others. People who like power can never get enough of it.

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