"At a single stroke, Buffett has given purpose to his life"

On Happiness, Money and Giving it Away
Peter Singer
Project Syndicate, July, 2006

Would you be happier if you were richer? Many people believe that they would be. But research conducted over many years suggests that greater wealth implies greater happiness only at quite low levels of income.

People in the United States, for example, are, on average, richer than New Zealanders, but they are not happier.

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Consider, in this light, the life of the American investor Warren Buffett. For 50 years, Buffett, now 75, has worked at accumulating a vast fortune. According to Forbes magazine, he is the second wealthiest person in the world, after Bill Gates, with assets of US$42 billion. Yet his frugal lifestyle shows that he does not particularly enjoy spending large amounts of money. Even if his tastes were more lavish, he would be hard-pressed to spend more than a tiny fraction of his wealth.

From this perspective, once Buffett earned his first few millions in the 1960s, his efforts to accumulate more money can easily seem completely pointless... Coincidentally, Kahneman’s article appeared the same week that Buffett announced the largest philanthropic donation in US history — US$30 billion to the Bill and Melinda Gates Foundation and another US$7 billion to other charitable foundations. Even when the donations made by Andrew Carnegie and John D. Rockefeller are adjusted for inflation, Buffett’s is greater. At a single stroke, Buffett has given purpose to his life.