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Wealthy is a term that’s defined differently by every person. But as financial advisors, our perspective is slightly different than most. It’s not a matter of how much you have. It’s about the kind of life it allows you to live.

A Deceptive Definition of Wealth

The word “wealth” can be very visual in our world. We tend to define wealth by what we see from the outside looking in – houses, cars, vacations, and other visible indicators. In our experience, being able to afford expensive things is not the same as being wealthy.

We encourage clients to measure wealth differently. Net worth matters, but it’s not the best measure of wealth. To us, wealth is better measured by the relationship between two things:

  1. Your picture of a meaningful life
  2. The financial freedom to pursue it

If your finances enable you to live out your version of a fulfilling life, that’s a better measure of wealth to us.

What Wealth Actually Looks Like

We sit down with clients who would never call themselves wealthy in the cultural definition. Still, when we open up their financial picture, they have the financial freedom to enjoy a meaningful life. We’ve seen clients retire early to spend more time with their grandkids. We’ve seen families be able to invest more time and financial support in organizations that mean a lot to them. Their financial planning enables them to invest in what truly matters to them.

We’ve also sat down with families that accumulated more money than they ever pictured, but they’re not experiencing a sense of fulfillment. Having “enough” is not the problem. Sometimes, having plenty of money comes with its own challenges. As one person told us, “I feel like I’m seeing cracks in the life we’ve built.” Here are a few examples clients have shared with us:

  1. “I’m concerned that my kids (or grandkids) have developed a sense of entitlement as our lifestyle has changed.”
  2. “We’re making plenty of money, but my job demands so much time. I’m giving my leftover energy to those who matter most to me.”
  3. “My spouse and I have very different perspectives about spending our money or investing in the future.”
  4. “We’re financially comfortable in retirement, but we really miss our family. How can we adjust our budgets to see them more often?”

It’s a familiar idea. You wouldn’t want to invest in a company that provides poor returns. We want to invest in parts of life that give us the most fulfillment in return. That’s easier said than done.

What’s Your Definition of Wealth?

At the end of the day, the question is not, “How should everyone define wealth?” It’s, “How do we define wealth?”

Money matters – we would be the first to tell you. Material things matter too, especially when we’re talking about their ability to bring joy. But at the end of the day, the #1 measure we prioritize is not net worth. It’s your freedom to pursue the things that matter most to you.

When you’re ready to work with a financial advisor who shares your definition of wealth, let’s chat. Welcome to Compass Ion Advisors.