Do you want to know the reason early retirees are happier? It’s not what you think. It’s not a stash of money providing financial independence. Nope. It’s the act of opting to have more time in our lives. More time to live our lives doing what we want to do. Not have to do.

It seems Happiness is higher for people who choose more time in their lives. Higher than people who want more money. That was the result of research recently published by Sage Journal -Social Psychological and Personality Science. This research covered all people, not just retirees.

Their Research Abstract

“Money and time are both scarce resources that people believe would bring them greater happiness. But would people prefer having more money or more time? And how does one’s preference between resources relate to happiness? Across studies, we asked thousands of Americans whether they would prefer more money or more time. Although the majority of people chose more money, choosing more time was associated with greater happiness—even controlling for existing levels of available time and money. Additional studies and experiments provide insight into choosers’ underlying rationale and the causal direction of the effect.”

The researchers at UCLA and the Wharton School conducted their experiments and surveying of over 4,400 people. The results were that about two-thirds of the respondents claimed they would rather have more money than more time. But the interesting part of their results was that the people who instead opted to focus on more time were the happiest about their lives.

The study included all people. It wasn’t targeting early retirees. But the human happiness factor would definitely be shared. The point I am going to make is this. Know when enough is enough and then escape the rat race. Because it’s what we value that will ultimately make our life happier. Valuing Time is the answer to Happiness.

The Relationship of Money and Happiness

Not having enough money to cover our basic needs will make anyone very unhappy. No question about that. Studies have been done to support that money does give happiness. But there have been studies and research that found after $75,000 of income happiness doesn’t climb as it did up to that point. That relationship of money and happiness held up even into the highest level of the income spectrum.

Our happiness peaks once our needs are met. Higher amounts of money brought limited increased happiness.

My retirement budget is nowhere near the $75,000 income happiness limit. Yet my essential needs are met and I am very happy.

The Relationship of Time and Happiness

What the UCLA researchers did was find out what people really want instead of what they have. They added the variable of “time” to unlock people’s true desire. That is how they found out that people who really wanted more time in their lives were happier.

The research results found across all groups a solid relationship between choosing time over money and the resulting levels of happiness. In the study they write.

“respondents who indicated the strongest preferences for more time were also the most happy”

The more we prefer and value time over money then the happier we will be.     

No Wonder Early Retirees Are So Happy

The Real Reason Early Retirees are Happier –

Lots of practice valuing time and happiness. For most early retirees, reaching financial independence takes embracing frugal living. Those on their FI (Financial Independence) journey and those now living the life of FIRE (Financial Independence Retire Early) are different. They already focus on what is most important based on happiness. That includes time with those we love and doing things we love to do.

We don’t work to support bad consumerist habits and wanting more stuff. Our budgets cover our needs. All extra income is saved and invested for our future. A future where we ditch the rat race and win more time.

It’s no secret. It takes money and a level of wealth to be an early retiree. One could argue that it easy for early retirees to be happy. They already have enough money. What the study showed was it didn’t matter how much money someone has. Once our needs are met it’s the focus on wanting more time that brought the happiness level up.

Most early retirees, myself included, got there through smart and balanced frugal living. We early retirees and people of FIRE are different in other ways. We learned to be content with what we have. We don’t spend money on lavish wants. Surely having a strong urge for things beyond our budget, like 2^nd homes, big boats, and exotic cars would hit us in our happiness. Stuff isn’t our focus. Money means different things to differently focused people. People on the FIRE quest sees money as a tool for more time. That’s why they are so happy.

In Conclusion

Basically the study found that if you ask a bunch of people who have enough income to meet their essential needs whether they want more money or more time in their lives. The people who choose to want and have more time are the happier people. Happier than those who focus and want more money.

For many on the FIRE quest we work hard and our time is stretched. We are happy because we are working for a goal. We know that it’s better to have enough money and less time than having a lot of time and not enough money. That’s why we begin the FI journey in the first place.

We know that worst yet is having no time and no money when everything earned comes in and immediately goes out. An endless cycle with no escape and no more time in our lives. The study found what we already knew. We just have a plan to ensure our continued future happiness.

Early retirees and those who believe in FIRE knew it all along. If you want to be a happier person and you have your essential needs met. Then by valuing time you will be a happier person. Seems to be a mindset direction most people can change to. Much easier than always wanting and trying to get more money.

Are you time or money focused? Are you a happy person?

Got Time?