A book I read in the third grade had an interesting description of a raccoon trap . It consisted of a hole just large enough for a raccoon to pass an empty paw through, and something shiny at the bottom of the hole. When the raccoon sticks its paw in and grabs the shiny object, its paw is now too large to fit back out through the hole. But the raccoon doesn’t want to let the shiny object go, and so the raccoon is stuck, trapped by its own desires.
If you’re feeling sorry for the little critter at this point, consider that you might be in a frighteningly similar situation. In the last article on happiness, I suggested looking at creating a happiness plan and trying it out for a year to see if it’s actually something you want to do. The idea being that you’re spending all this time and effort trying to attain the dream of early retirement or a bigger house or more stuff, but you don’t really know if any of that will actually make you happier.
If you balked at the idea of taking a year off or thought it ridiculous, take a step back and think about why you had that reaction. Is it because you fear leaving your current job would mean a painful reduction in your standard of living? If that’s the case, consider that this fear is an indicator that your current level of happiness might already be in danger.
Jealously guard control
Maintaining control over our own lives is one of the ways we can protect our happiness. When we feel out of control we suffer helplessness. Helplessness is one of the least bearable feelings and causes physical and mental distress. And if we feel helpless for long enough, we simply give up and stop trying. We become depressed, and stop even looking for ways to make it better. So if we want to maintain and increase our happiness level, we must maintain control over our lives.
Reduce your “standard of living risk” and be happier
Two of the most important places to maintain control are in our standard of living and our job. Interestingly the two are closely related, and gaining control over one, will provide greater control over the other.
“Standard of living risk” is the likelihood that we won’t be able to maintain control over our standard of living. Since our standard of living is funded by our income, and higher incomes are harder to get, more expensive living standards have a higher standard of living risk. That is, we are more likely to suffer an involuntary lowering of our standard of living if our standard of living is expensive.
So in order to avoid suffering an involuntary lowering of our standard of living we can voluntarily reduce our standard of living risk by choosing to have a less expensive standard of living. Even if we can currently afford a more expensive standard of living we would choose to maintain a more modest one.
So instead of buying a huge new house in a new neighborhood with a massive mortgage payment, we would choose one in a less swanky neighborhood, or we skip the house altogether and go for an apartment. And instead of buying a new car, and maintaining a car payment, we buy an older car for cash. And we make do with one TV and no cable. And the kids share a bedroom. And so on.
The idea here is lower our standard of living to the point where we know we can keep it constant at that level, and in that manner to keep control over our life.
It may seem counterintuitive to try to be happier by lowering our living standards, but consider that studies show that we feel a loss more than twice as keenly as we feel a gain. So in order to preserve our happiness, we should be more mindful of preventing losses than seeking gains.
Also consider that we adapt to a new level of living standards and return to our set point happiness, but it does take a little time before that happens. So if our living standards are constantly being taken up and then brought back down, we don’t have a chance to get used to them and our happiness level is always less than it could be if our living standards were constant.
And finally, with a lower living standard there is less financial worry. If we don’t have bills to pay, or we can easily afford to pay them all, then we won’t have worry. And avoiding worry will increase most people’s happiness all on it’s own.
So as odd as it may sound, we would actually be happier at a lower standard of living if that standard of living was constant.
Hold the line with slack
So how do we provide a constant standard of living? We make sure that we can maintain an income that easily supports that standard of living. And just as importantly provides some extra room for when things go wrong like car repair costs, and other financial surprises.
We want to match our standard of living to an income that we are relatively sure we can maintain. This would be the lowest income we are certain we could get if we went out in a poor to middling economy and took the first job offered. This income doesn’t include raises, bonuses, performance pay, overtime, time and a half, unusually high salaries due to a boom in our industry, or unusually high salaries because we are extremely valuable to our current employer. We want to remove all those variable income components and only consider the part that we can really count on. That’s what we will match our standard of living to.
I imagine that is quite a bit less than most of us are used to living on. But if we base our standard of living on that amount, we can be relatively assured that it will be constant and that our happiness level will not be affected by a reduction in living standards.
A side benefit is that all those raises, bonuses, and other income goes right into savings. This builds a nice cushion to handle any big financial emergencies. And another benefit is that the lower our expenses, the easier it is for us to be financially independent. So not only are we increasing our savings faster, we’re also reducing the total amount we need to save to support ourselves indefinitely. That’s like burning the candle at both ends. We’ll be there in no time.
Control at work
So now that we have our living standards under our control and we can fund that standard of living with a job we can pretty much go out and get tomorrow, how important is our current job? Right, not at all. It’s no longer a trap for us. We can leave whenever we want to.
Before, when our living standards were dependent on our exact current job, our employer had complete control over us and we were at their mercy. They could ask us to work longer. They could ask us to work harder. They could reduce our benefits or take away our perks. They could even ask us to violate our morals. And until now, if we didn’t take it quietly and do what they asked, we were afraid that they would take our job and hurt our standard of living.
But now, we have the control and are on equal or higher footing than our employer. Now the situation has flipped and they need our knowledge of their business, our skills, and our time, but we don’t need them. Any job will do for us now. So we no longer fear losing our current job because it can be replaced without a problem. We don’t have to suffer any insults or indignities and can walk out at any point that we desire without any pangs of worry.
In fact, we now have the confidence and control to take risks that our coworkers won’t be willing to take. We can boldly ask for a raise or other perks. We can speak our minds and say what needs to be said. It might even make us better employees, as we won’t be scared into being “yes men”.
We can even ask for a year off with benefits to go pursue our happiness plan. And we can confidently threaten to quit if we don’t get what we ask for, which again, counter intuitively might mean we’ll get an even higher salary than we would have if we just stayed quiet and kept our heads down. The squeaky wheel really does get the grease.
Voluntarily let go of the shiny object
Free yourself from the high living standards trap. Voluntarily choose to lower your living standards to where you can maintain them at a constant level. And take back control over your life and your happiness.
 The book was “Where the Red Fern Grows” and the real trap was a little more gruesome, but the point gets across well enough without that part.