Rich Beyond Your Dreams

Can you sleep at night knowing what your money is doing?

by Nina Winham

Roller coaster... meltdown... bailout… recession... depression? It’s certainly been a crazy time in the big-money financial world over the past few weeks. Meanwhile, the average saver and investor is left to figure out if this will all blow over or if it’s a warning to retreat, play safe, and count one’s blessings.

For our Women and Wealth issue, SharedVision’s True Wealth columnist, Nina Winham, gathered a group of women for a conversation about money, wealth, and social responsibility. What does it mean to be wealthy? Is it only about money, or something bigger? And how do you handle your money if you care about your impact on the world? These are complex questions even in financially stable times. But as markets continue to convulse and titans tumble, we’ve realized they’re even more critical at times like these. We’re pleased to share our roundtable’s thoughts with you.

Nina: A lot of people don’t realize that the money they save or invest is lent out by their financial institution, that it’s one of the drivers of our economy. But you’ve all thought about the effect your money has on the world. How did you become aware of that?

Eva: If you don’t see the results, any investment is fine as long as you’re getting a good return. But when I was advisor to the minister of privatization in Poland, one day I told my assistant: “I want to see where all the action is.” So we went to a small town, where an investor had bought a factory and immediately shut it down. Six hundred people were unemployed, who were going to stay unemployed. Their lives were in poverty and deprivation, and they had been counting on life employment. It was like a spiritual collapse for me, that I was contributing to this. I left my position and decided I would invest my money in ways that bring something to the community. It’s not just to make money; there are people affected by it.

Jessie: When I first looked into screened funds, I was shocked. They wouldn’t do arms or cigarettes, but I wasn’t comfortable with what they do invest in. So we buy government bonds to help governments pay down debt and pay for government programs. And we buy GICs (Guaranteed Investment Certificates) from my credit union, so I know we’re making money available for things in our community. Plus, I’m not worried at all about the shakiness of the market because I’m not in it!

Mary: When I lived in England, I became aware of the effect investors had on law reform. American investors were asking hard questions of the U.K. government. “Unless you stop religious discrimination in Northern Ireland, we’re going to pull out our money.” That made me aware of socially responsible investing.

Tamara: I consider myself to be a caring person and I hope an ethical person, and I couldn’t reconcile that with the fact that maybe my money was going to the military-industrial complex. So I switched to socially responsible investing. And you’re right, Jessie, it’s not perfect. But I’m a beginner, and I don’t know what the better choices are yet.

Eva: I bought stock directly, but I found it hard [to] stay on top of the companies’ activities. It was time-consuming, and not that thrilling, but it was a good lesson. I thought, OK, I’ll have someone else do this. I read my reports, and I believe 70 to 80 per cent is quite kosher. But how do you judge? Pepsi is now bottling water. So they’re less involved in encouraging children to drink pop—but is that sustainable? That’s the grey zone: child obesity versus plastic bottles.

Catherine: The easy thing was an ethical mutual fund. I chose one with more screens and an element of shareholder activism. To me, that looked better. I’ve been a community activist all my life. It never occurred to me to do something different with my treasury than I do with my talent—it would be so profoundly discordant.

Jessie: I feel the same way. There are lots of people who live their values every day. But then they put their money in, and they don’t even think about it; they just have normal investments. Financial folks shake their heads at my family’s choices; they say we could make more money. But I don’t want to invest in those things, and I don’t want the stress of the market system. It’s glorified gambling. I’m not making a terrible value judgment against anyone, but that’s what it is.

Eva: I can see how people can get sucked into it. It’s thrilling. I’ve done it. You make a little bit of money in a few minutes, and it’s fun.

Nina: I want to ask about the idea of wealth. What does it mean to you to be wealthy?

Eva: For me it means healthy. Once your health is gone, nothing will help you. My friend died in six months with cancer. She left several million dollars to her sister, but she was gone. I learned quickly that health is wealth. So I spend money on vitamins. (laughter)

Tamara: I think of wealth and success as having complete control over how you spend your time. It’s good to work, and if your work is meaningful that’s great. But grinding away without flexibility doesn’t help a person grow. There’s value in having control over what you focus your energies on.

Jessie: In my eyes, wealth is the privilege to spend time with my daughter. Because a lot of people don’t have that privilege; they need two incomes. On the other hand, I know people who work more than they need to and don’t spend time with their kids—and I think they’re crazy.

Catherine: I heard an heiress speak about deciding what to do with a huge amount of money. She said, “I decided I had enough. I could give the rest away.” I thought that was so compelling: “I have enough.”

Jessie: There are studies that show that up to a certain point, you actually are happier with more money…

Mary: But that point is quite low.

Jessie: Yes, depending on where you live.

Catherine: There was a study in Vancouver. After something like $41,000 to $47,000 a year, no additional money brought additional happiness. That was enough.

Eva: The bottom line is that happiness is a state of mind, not the state of your bank account.

Jessie: Exactly. How many yachts can you have?

Tamara: The more things I have, the more weighed down I feel. To me, wealth means being free of things. I love getting rid of things; I feel lighter. I know people who say, “Oh, I’d like to travel, but what will I do about my house, my car, my things?” I say, get rid of it!

Nina: In your opinion, are ideas about wealth different for men than they are for women?

Eva: I think men see wealth as power and leverage. Women see it as utilitarian, to get what they need for themselves and their family.

Mary: I think a lot of men think providing economic security for their families is an important part of their role. But it also seems—whether by nature or nurture—a lot of men are competitive. And money is one way to compete. Not having an absolute amount of money but having more than the other guy.

Jessie: I don’t actually know anyone like that.

Mary: Because you’ve never worked in a large law firm! (laughter) If every partner in the firm is making scads of money, you still don’t want to be the one who makes slightly fewer scads. It’s relative, not absolute.

Nina: That’s the thing with money. You can say absolutely that $53 is more than $52, but it’s hard to say you’re a little bit happier.

Mary: It seems to me wealth is the relationship between your perceived wants and your perceived needs. Like that Dickens quote—if your outgoing is a little more than your incoming, that’s misery… but if your outgoing is a little less than your incoming, that’s happiness.

Nina: We lose sight of what we can control, that we can afford happiness by redefining what makes us happy, what we “need.”

Eva: I think there’s a movement growing for a simpler life. But also to create a legacy. It doesn’t have to be millions; you can combine your knowledge and time. I have one client who sold her house, and she’s building a school for children in Cameroon. Because for something like $20,000, she can do that.

Nina: So if a young person asks your advice about building wealth, what would you say?

Eva: Save your money. Start saving, and invest in something that is kosher.

Tamara: I see a lot of young people who jump into 40 hours a week and buy a condo and a car. I encourage people to travel. It opens your mind and changes how you behave. Canada is the exception to the way things are in most other parts of the world. Most people don’t bathe in drinking water. Not everyone has hot water. We are the privileged ones. Canadians are rich. Some aren’t. But most are.

Catherine: We need to take a “plenty” attitude to what we have, instead of a scarcity attitude, where we accumulate more and more. And say, “I have enough.” An important part of being well—wealthy—is giving back, making contributions to your community. And then another part is feeling OK about your finances. Can you go to sleep at night knowing what your money is doing? Is it aligned with your daytime principles? That’s a pretty good test for how you should be investing and accumulating wealth.

Nina Winham is principal of New Climate Strategies (newclimate.ca), helping businesses and non-profits build value through sustainability and positive change. Good conversation over a glass of wine always makes her feel rich.