What is in your Happiness Portfolio?

As we plod down the path to financial independence and early retirement, we grow more financially savvy every day. We pore over our asset allocations and engage in lengthy debates about things like the value of bonds in the accumulation phase. We keep a stern eye on our expense ratios. We become familiar with diversification of our financial assets as a risk management strategy. We diversify our portfolios by holding a variety of investments in order to minimize the impact any single security can have on the well-being of our portfolio. There is also much talk about diversifying sources of income and the personal finance community worships at the twin altars of side hustles and landlording.

Can these valuable financial lessons be applied to other areas of our lives?

Let us start by asking ourselves:  What is more important than money?

If you answered, “Happiness!”, give yourself a pat on the back. If you did not, go directly to jail. Do not pass Go. Do not collect $200.

Can we agree that the increase and preservation of happiness is as worthwhile a goal as growing and protecting your nest egg?

What is in your happiness portfolio? Is it well balanced? Is it diversified?

Your Happiness Portfolio

They say that all work and no play makes Jack a dull boy. It is worse that that. Not only is poor old Jack doomed to an eventual endless purgatory of dullness, Jack has made the grave error of putting all his happiness eggs into a single work basket. One cranky client, and Jack’s day is shot. One asshole manager and his year is in the crapper.

Luckily for us, we are better off than Jack. We have sparkling, alluring personalities marred by not one iota of dullness. In fact, we likely already have more than one thing in our lives that bring us happiness and satisfaction. Here are a few commonly held asset classes in one’s happiness portfolio:

  • Your family, immediate and extended, including your pets
  • A job that stimulates
  • Your circle of friends

Assets in your happiness portfolio

Three Fund Portfolio, anyone?

You, unlike dullard Jack, are probably already reaping the benefits of the various asset classes in your portfolio. You have a spat with your spouse in the morning, but then you are awarded a peer bonus at work that afternoon. A customer reams you out because of a bug in your software, but then your toddler climbs into your lap and covers your face in kisses. Your kid throws a screaming tantrum on the floor of the grocery store, but your partner pours you a glass of wine and massages your feet. When humankind swings on your last available nerve, your dog looks up at you like you are god’s gift to the world.

While your family, your job and your friends likely make up the bulk of the asset allocation in your happiness portfolio, you probably hold small positions in other happiness securities like

  • Watching the rain come down while you are curled up warm and dry on the couch armed with a steaming cup of coffee and a good book
  • Playing a kick-ass game of tennis
  • Singing at the top of your lungs (and off-key) on a long car drive

Whatever asset classes you choose to hold in your happiness portfolio, the important lessons are these:

  • You must hold happiness assets whose performance is not correlated with one another and
  • Your portfolio should be well balanced between all your asset classes.

If, for example, you have only two happiness assets: Your job, which accounts for 20% of your happiness and your spouse, who accounts for the other 80%, then if your spouse runs off with the mailman, the performance of your happiness portfolio is going to be abysmal.

Seeking Diversification

Your financial portfolio could sport a sensible asset allocation of 50% U.S. Stock, 20% International Stock and 30% Bonds, but if in the 50% domestic stock category you held the stock of a single U.S. company, the performance of your portfolio over the long run is going to be disappointing. Diversification is critical for success.

And so it is with your happiness portfolio. Once you identify your major happiness asset classes, you should strive to diversify them.

Our sample, simple 3-fund happiness portfolio had an asset class called Work. For me, for nearly my whole life this has meant my one and only day job. What did this mean for my happiness? When I was being creative at work, and building new things, I was happy. When work turned into an endless drudge of meetings with everyone around me spouting corporate speak, my happiness index took a nosedive.


And then I started writing this blog. Now, when my day job is not scratching my creative itch, I can rely on the blog to do it. And on days when my blog pageviews are more a trickle than a flood, I can seek comfort in the fact that the stuff that I create at work is installed at thousands of customer sites.

Unfortunately, there is no Jack Bogle of Happiness. We don’t have the luxury of passively investing in our happiness streams. Investing in our happiness portfolio takes effort. We need to put in the work if we want the the returns. What do you do when the markets are down? Do you withdraw your money and run for hills? Not you! You grit your teeth, and double down. So must it be with your happiness portfolio. When happiness is in short supply, don’t give in to a life of despondency. Work harder on your existing assets and bust your ass to acquire new ones. Change your job. Make new friends. Fall in love with your wife all over again (or move on to spouse numero dos, if that is what it takes).

Performance of happiness portfolio

Investing in people and relationships is hard work. Investing in ourselves can be even harder. Things worth having are worth the effort though, and happiness is a worthy goal.

Monitoring Your Happiness Portfolio

You track the health of your financial portfolio using spreadsheets or Mint or Personal Capital. Tracking is good because

  • It helps you figure out if you are on track to reach your goals
  • It helps you spot mistakes, and fix them early

In the absence of a nifty happiness app how is one to track of the performance of one’s happiness portfolio?

The answer is mindfulness (and, of course, spreadsheets. They say the answer to life, the universe and everything is 42. I think it might actually be spreadsheets).

Take the time to think about what is making you happy and what is not. Consciously decide to be happy when a security in your happiness portfolio is performing well. This is where spreadsheets can help with mindfulness. I keep a spreadsheet that I update every night. One of the questions I make myself answer when I update the spreadsheet is whether any of my smaller happiness positions did well on that day. The spreadsheets counts the number of days that the answer to this question is yes. So, if I saw a rainbow that day, I increment the count. If I laughed so hard at something that I squirted my drink out of my nose, I answer yes. I find that updating my spreadsheet every night helps me in two ways:

  1. I remember and consciously enjoy little things that may otherwise have gone unappreciated. When I take the time to be grateful about them again, I feel happier. And that sets the tone for the next day.
  2. I like to be able to update my spreadsheet (yes, that is a bit weird. I am aware), and I have found myself searching out happiness opportunities during the day so that I can declare success when I make my update at night. So, if at 3 in the afternoon it dawns on me that I haven’t yet had a happy moment, I try to do something to rectify it. I’ll go talk to a colleague who has a great sense of humour. Or I’ll call a friend for a quick chat, or to make a plan to meet up. The point is that being mindful about the performance of my happiness portfolio has made me actively seek out happiness, and that in turn has made me a happier person.

The Language of your Soul

In all but the most dire of human circumstances, happiness is a choice. It is a choice we must make for ourselves every day. Build your happiness portfolio alongside your financial one. Seek out assets wisely, and diversify.

May your soul never run out of things to say.


25 thoughts on “What is in your Happiness Portfolio?”

  1. Great post! It’s so true we need a balance in life. Personally, I’ve found the “Jack Bogle” of happiness in Gretchen Rubin. I’ve read several of her books, and listened to her “Happier” podcast when I need some ideas on how to be happier in my life. Although I don’t try everything, she always has some great ideas on how to diversify and make your life a happier one.

  2. Hahahaha, this is wonderful. 🙂 I do think finding purposeful hobbies is the key to making the best of any other lacking area in your happiness portfolio. For example, I’m stuck at a high-paying yet soul-sucking job. I haven’t found a better one yet, so I make sure to enjoy my day with hobbies (writing, baking, etc.). It’s not perfect, but what is in this world?

    1. You have diversified successfully! It doesn’t have to be perfect, it just has to be good enough to keep you in a happy place.

  3. I like the analogy though I’d never really thought about it this way. Having a job as your only source of happiness is a good way to end up old and full of regrets. No one ever says I wish I could work more on my death bed, they say they wish they could spend more time with someone or do something specific. Still work can be a source of happiness and accomplishment when viewed in a balanced manner.

    1. Having anything as your only source of happiness doesn’t sound like a recipe for success. You are right that work can absolutely be a source of happiness and accomplishment, just maybe not the only one.

  4. Wow! I feel like you were walking around my brain on this post. I was mulling over why a friend’s arrogance was so annoying… and then it hit me! His life is successful in one area, his job, but no real other area (divorced, few friends, strained relationship with family). As you put it, he is not a successful happiness investor in life, and so the arrogance over everything is quite misplaced, I think. Thanks for articulating my thoughts so well! 🙂 (I love your writing, BTW).

    1. Thanks Laurie! Your friend sounds……sad. I hope he realizes soon that some diversification is in order.

  5. I have multiple pie charts like this! The life one includes areas of my life that can be stable, or not stable: work, hobbies, relationships. The subsets of work are money/earning, achievements, relationships built. The subsets of hobbies are money/earning, relationships built, personal entertainment value. The relationships wedge is comprised of give and take, and making sure that I’m nurturing relationships that matter, one way or another. I don’t have to invest a great deal of money or time into any single relationship except perhaps my immediately family unit, but I do have to invest something if I want to keep it alive and well.
    You’re exactly right, diversification is key to maintaining a balance when any one area takes a nosedive, as it will do in the natural course of things.

    1. It makes me happy that you actually use pie charts to track your life, and that you keep track of your relationships and make sure that you are investing in all the ones you think are important. I predict good returns from your portfolio over time. As you sow, so shall you reap, they say, and if they are right, you should have a fine harvest coming.

  6. I just wrote about the three fund portfolio, but your version made me much happier. Without a job, much of my time is spent optimizing happiness by pursuing hobbies I love and rekindling relationships that have been neglected for decades. Keeping track of what makes you happy is just as important as tracking your money 🙂

    1. As an early retiree I fully expect the returns on your happiness portfolio to be kicking my returns in the butt.

  7. I love that you track your happiness daily! That is awesome. It is so unwise to put all of your happiness eggs in one basket; life’s inevitable ups and downs make that an inevitable disaster. Even if your marriage or primary relationship is awesome, to avoid any secondary relationships is dumb; no one person can make you happy all the time. That’s way too much pressure on each person. I have my husband, but I still need my girlfriends! And now that I don’t have a traditional job, even though my job wasn’t all rainbows and sunshine, I miss that portion of my happiness portfolio. Thankfully, I’m able to fill some of that with writing and blogging. It reminds me of the people who say “won’t you get bored?” when talking early retirement. If you retire earlier, you’ll most likely enjoy better health and greater flexibility to explore tons of exciting activities, thus avoiding boredom. But also, why do people assume your job is the only thing that can bring satisfaction? Yet most people are dissatisfied at work…It doesn’t add up😉.

    1. Tracking has made a huge difference to me. I highly recommend it. You are very right about no one person being able to make you happy all the time. And yeah, I don’t get the “won’t you get bored?” question either. To me boredom signals a mind singularly lacking in imagination. With all the world out there: all the books, all the places, all the internet – a universe of things to learn and try, how can anyone ever be bored?

  8. True – Discovering the Bayalis blog was my happiness high point!! And poor Jack sounds like he needs a few drinks and a night out with friends. 🙂

    Happiness, and the factors that get you there, is always evolving…isn’t it? I can honestly say that what made me happy years ago makes absolutely no sense to me now. An expensive meal out is no longer enjoyed as much as a night in cooking what I please. Nice bottles of red have been replaced by boxes that seem to go on forever. And my dreams of cruises and expensive resorts with infinity pools have been replaced by the more rewarding feeling of hard work it takes to hike from one town to the next followed by a room temp shower and a bed in a hostel full of snorers…well, if we can get hot water and eliminate the snoring that picture might be perfect! All of these changes have also helped to fuel my FIRE and get me on to the next phase of life sooner than I ever expected. If we paid more attention to the key factors in life (family, friends, culture, religion for some) then I could only hope there would be less depression and more enjoyment in life. That would make me very happy. 🙂

    1. Hahahaha. I was waiting for someone to catch that and give me a hard time.

      Yes, happiness is a target that changes with age and life experience. Which is why we must add new asset classes and get rid of securities that no longer perform. I like the evolution of your happiness triggers – not only are they more friendly on the wallet, they also seem more accessible, which means you can indulge in them more. That in turn means more happiness more often. Win-win.

  9. The happiness portfolio is by far the most important portfolio ever. Contributing to this one is the only real goal in life. I came to realise this a few months back. Today was a great day, I had a lot of quality time with the family, had a Skype with another blogger, wrote some articles… I hope to add some friends into the portfolio tomorrow.

    Funny that it is a 3 fund portfolio. My ETF portfolio has 3 funds and I have 3 women at home 😉

  10. Holy crap this is brilliant! If this isn’t Rockstar material, I don’t know what is. “Discovered Bayalis blog” is comic gold. “Gold, Jerry!” And by all means, heed Chief Mom Officer’s advice. You’ll love Gretchen Rubin. She even has a podcast on happiness.

    1. This comment was responsible for a serious uptick in my happiness portfolio. Thank you Mr. Groovy!

  11. This is a great great post!!! I love the thought of the three happiness categories as it’s something I’ve thought about but never put it all together like this. It’s also interesting how over the years different pieces of the pie become more or less important to me. I’m huge into family right now where before work made a bigger piece of the pie. Anyway great post!!!

    1. Thanks MSM. The parallels with the financial world continue! Your asset allocation changes from when you are young (mostly stocks, mostly work) as you get older (more bonds in the mix, family more important).

  12. Love this concept of happiness as it relates to personal finance – it’s almost like we could use the bucket budget strategy to bucket our happiness to make sure we balance it right!!

    After reading a few personal dev books and regularly listening to personal dev podcasts, it’s well known people, relationships, and your passions make you happy. I love tracking them spreadsheet or any other way people do. Great article thanks for sharing !

Leave a Reply