Ron Carson, Contributor
April 30, 2021
If you’re not familiar with the “get-give ratio,” there’s a good reason for that. It’s something several friends and I came up one evening while sitting around a roaring fire, enjoying the crisp night air and some good music. To me, that’s the perfect recipe for kicking back and just talking about whatever comes to mind—maybe even getting a little philosophical.
At one point, the conversation turned to dogs. Of course my black lab, Nellie, was sitting there beside me. We started talking about how dogs give everything—love, empathy, loyalty, companionship. Yet, they don’t ask for much in return. Nellie is a great example. For her, contentment is a full belly (usually something with chicken), a long walk and lying on the couch or floor next to her people.
That invariably led to a deeper discussion about what the get-give ratio looks like in our own lives, and what motivates people to give—even when there is no clear return to be had. I’ve always heard that if you make deposits in other people’s buckets, the universe will have your back and reward you. I think there’s a lot of truth to that.
The importance of creating an impact
Recently, during one of our quarterly leadership meetings, we did an exercise that involved everyone writing a letter to their future selves, 20 years down the road. A common theme quickly emerged: Money is not an end in itself, but a tool for creating the impact you want to see in the world, whether that’s your family, your business, your community, etc.
Dan Price, the CEO of Gravity Payments, is a great example of someone using their financial resources to create the kind of impact they want to see in the world—but in a very unconventional way. According to HuffPost , the tech entrepreneur shocked the business world in 2015 when he announced plans to slash his own $1.1 million pay package to help fund a minimum “living wage” of $70,000 for all workers at his Seattle-based credit card processing company. The plan took two years to implement. Instead of going out of business, as critics across corporate America and Wall Street predicted, the company has been hailed as a success by Harvard Business School and Inc. magazine, which noted the number of employees at Gravity has doubled while the value of payments that the company processes has gone from $3.8 billion a year to $10.2 billion. However, what I found most remarkable was Price’s response to a question posed to him on Twitter , asking what had changed about his life, following his extreme pay cut to $70,000 per year.
Price responded: “I made a lot of personal changes. But I still had savings and made a fair salary. I don't miss anything about the millionaire lifestyle. Money buys happiness when it gets you out of poverty but not when it gets you from well-off to very well-off.
Price’s remarks echoed the results of a well-publicized study conducted by two Princeton University researchers in 2010, seeking a definitive answer to the age-old question: Can money buy happiness? In a nutshell, the researchers concluded that “high income improves evaluation of life but not emotional well-being.”
The study noted that as salaries increase beyond $75,000 (roughly $90,000 in today’s dollars, adjusted for inflation), “higher income is neither the road to experience happiness nor the road to relief of unhappiness or stress, although higher income continues to improve individuals' life evaluations.”
One of the study’s authors explained it this way to Inc. magazine: “We suspect that this means, in part, that when people have a lot more money, they can buy a lot more pleasures, but there are some indications that when you have a lot of money, you will savor each pleasure less. Perhaps there’s a threshold beyond which further increases in income no longer improve individuals' ability to do what matters most to their emotional well-being, such as spending time with people they like, avoiding pain and disease, and enjoying leisure.”
I’ve seen this theory play out many times over the course of my career as an independent wealth advisor. All too often, successful people get caught up in the rat race of accumulating wealth. That can lead to viewing your wealth as a measure of your success or social standing. The more wealth you amass, the bigger and better the “stuff” you need to continue to signal your success to the outside world. However, it can leave you feeling empty and bereft on the inside.
How the get-give ratio can make a difference in your life
As you think about your own life, consider what the get-give ratio means for you. Where do you want to make an impact as you go through life and after you’re gone? Life provides endless opportunities to give of ourselves—as parents, siblings, grandparents, professionals, business owners—you name it. Maybe you do that through volunteer work, daily acts of kindness or putting a grandchild through college. Maybe starting your own charitable foundation, scholarship or endowment is more your thing.
However you choose to make an impact, make sure you’re viewing your wealth as a tool for fulfilling the experiences you desire for yourself, family members, and the causes and organizations you support. That will allow you to create the meaningful alignment you seek between your money and your values.
This is where working with an independent wealth advisor, who serves in a fiduciary capacity, can make a difference for you and your family. A financial advisor can help you determine what organizations and charitable giving vehicles align with your values. They can help you calculate a plan to donate to important causes in a way that maximizes your generosity and offers you and your beneficiaries the greatest tax benefits. That enables you to give in a way that makes the most impact. As for what you get in return, take it from Nellie, be a good human and the universe will have that one covered.
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