There is a phrase that I hear a lot. “Money can’t buy happiness.” But for most business people who spend all day thinking about money, I bet most of you have never stopped to think about what this phrase really means. In today’s video, we are going to be tackling the really big questions about money. What does it really mean for you if money can’t buy happiness?
It is the start of a brand new year. 2021. We just ended 2020, which for many people around the world, was a year of hardship. 2020 was a difficult year. A lot of people have lost their lives. A lot of people are taking time to reflect on what is really important in life.
For people who work in business, so much of our life revolves around money. All the tools you learn about in business are about making profit. You want to make the most money possible. And yet we are faced with a contradiction from that very famous phrase, “money can’t buy happiness.” We are chasing something that will never let us buy what we really want… to be happy. So we have to ask ourselves, what are we doing? Are we crazy? If you are a business person, what is the point? The pressure that everyone has faced around the world this last year, has left everyone asking this question, “why are we struggling so hard, when there are so many people who are unhappy?”
There is an answer to this paradox, and I think it is helpful to take a step back and look at business history. We need to go back to the Renaissance in Italy, to the person known as the Father of Accounting, Luca Pacioli. Luca Pacioli wrote the first textbook on accounting. His writings ushered in the current era of modern accounting and paved the way for the growth of business around the world for the last 500 years.
There is only one painting of Luca Pacioli, so we have an idea of what he looked like. In this painting we see him teaching accounting with one of his students behind him. There is something very interesting about this painting. Luca Pacioli is dressed as a monk. He is wearing very plain and poor clothing. Just think about this. Here is a person who was well-known in his day across all of Italy for being the money expert, and he is posing for the only painting in his life wearing the clothes of extreme poverty. Even the student behind him is wearing flashy clothing. Luca Pacioli could have chosen to be shown with a fancy house, fancy clothes, piles of money, parties, status symbols, and in contrast we get a monk. He chose to dress like a monk, when he did not have to. But it goes further than that. Luca Pacioli was not just any monk. Luca Pacioli was a Franciscan monk, which is a particular group in the Catholic church who is best known for their vow of poverty. They believe in giving up all worldly possessions and dedicating your life to serving the community, giving to the poor, and doing good in the world.
This painting reflects Luca Pacioli’s approach to business. His writings describe business as something bigger than just being about the money. Yes he talks about money. He explains how to get rich. He gives you all the accounting tools and techniques on how to find profit in your business. But he also talks about business’ role in benefiting society and the importance of ethics in business dealings. Luca Pacioli’s is telling us that building a good business is not just about accumulating the most money.
I do not think this is a paradox at all. It is only a paradox when you make money the only thing you care about, when money is actually only one part of business. Over the last two weeks on this channel, we have been talking about making data driven decisions. Any decision is data plus judgement. Well, when we are talking about money, money is just another form of data. When you make decisions in business, it is important to understand what the money is telling you, but you always need to add your own judgement. What is ethical? What decision aligns with your goals? What will make you happy? How can you give to others? How can you be a leader in your community?
You have probably noticed, I end each video on this channel by saying “let’s go out and make some money.” But I do not want you to misunderstand what I mean. I don’t want to encourage people to be money hungry, and just chase after acquiring wealth. I am talking about using money as a tool. I want to encourage people to learn what money is teaching you, and combine that with your own judgement to make better decisions.
In today’s world, it is so easy to get lost in this blind pursuit of wealth. But money can’t buy happiness. People chase money at the cost of everything else, and they forget that money is only part of what makes a good business. What you really want, is to do good in the world. You want to build a successful, money-making business, that also supports the community. What you really want is to have a life that is well-lived. To keep this in perspective, remember that Luca Pacioli, who gave us accounting, lived a life of poverty by choice.
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Neither Zach De Gregorio or Wolves and Finance shall be liable for any damages related to information in this video. It is recommended you contact a CPA in your area for business advice.