Is money the key to a good life?

Providing money to loved ones, such as a deposit on a home, is valuable, but it can’t substitute for genuine love. Getty Images

As the year draws to a close, it’s time for reflection and to gear up for stepping into the new year on the right path.

A year of hard work has quite probably been dedicated to building your portfolio, but in all the hustle, have you paused to contemplate its true purpose?

A life well lived encompasses more than just financial gains; it’s about embracing a holistic perspective.

This means achieving four key pillars: health, freedom, purpose and love – universal elements that transcend cultural and belief boundaries.

Regardless of background, every individual aspires for good health, freedom (be it through wealth or ideology), a sense of purpose and love.

These pillars collectively form a compass guiding everyone on their life journey.

However, these aspects aren’t binary; they exist on a spectrum.

Health, for instance, isn’t as simple as being healthy or not; it involves varying degrees. Similarly, freedom can manifest differently in different facets of life.

Picture these four factors as dials on a control panel, rarely at a perfect 100 per cent or zero per cent.

Life experiences and diverse factors contribute to their positions, with money being a significant factor in adjusting these dials.

Money often takes centre stage in our lives because we believe it has the power to enhance all aspects of life satisfaction simultaneously.

Yet, the truth is that money can influence only some of these life dials.

While it is crucial where it can make a difference, relying on money alone is not the solution for every aspect.

Take the impact of money on health and freedom. Money can, indeed, have a substantial impact on health by providing resources for a wellness journey – hiring a trainer, improving diet with quality produce and supplements.

However, without commitment and discipline, you’re simply multiplying a significant number by zero.

Now, consider freedom, which comes in two forms: personal; and enabling the lives of loved ones.

Money can boost personal freedom by allowing focus on meaningful pursuits rather than constantly chasing more or settling for something when it’s not a true passion.

Additionally, it plays a crucial role in providing a better environment for loved ones.

So, money not only affects personal freedom, but also the freedom of those you care about.

The key question is this: Is money the key to a good life?

The answer is complex, as we often forget the simple truth that not everything important comes with a price tag.

For example, essentials such as food, shelter and financial rewards for our time contribute to our well-being, but the underlying “why” behind these needs a closer look.

Now, let’s explore the aspects of purpose and love, where money’s impact is limited.

Purpose, derived from exploration and discovering interests, can’t be solely influenced by money.

While money opens and closes doors, it can’t provide the intrinsic reason behind your interests.

Purpose stems from personal drive, the development of skills and overcoming challenges.

Love, standing out as the most significant dial, also can’t be replaced, or bought, with money.

Providing material wealth to loved ones, like a deposit on a home or money towards education, is valuable, but it can’t substitute for genuine love.

Untangling the intricate relationship between money and self worth is challenging, but understanding these four life dials – health, freedom, purpose, and love – provides clarity.

This enables one to shine light on the quality of decisions, prevent drift, optimise your affairs, overcome challenges and help ensure you achieve your ideal future pathway.

In essence, while money plays a vital role, it is just one part of life’s journey.

Understanding the dynamics between money and these crucial life factors ensures you stay on course and live a life well aligned with your goals.

Sam Instone is co-chief executive of wealth management company AES