Financial gurus usually tell people not to envy the financial successes of their family and friends. Don’t envy their nice cars or big houses. Don’t envy their great vacations or their early retirement. After all, you may not have their means or good fortune. The conventional wisdom is that envy simply leads you to try to compete and you may dig yourself into a deeper financial hole if you try. Even if you don’t try to keep up, envy can eat at you and turn you into a bitter, hateful person. But is this always the case? Are there times and circumstances where envy can be helpful? I think so.
Envy is helpful and motivating if you channel it positively and responsibly. Let’s say that your neighbor, Joe, just bought a great car. (And let’s assume that Joe can easily afford the car and didn’t go into debt to get it. A truly enviable situation.) Simply saying, “Hey, Joe has a nice car and I really like it so I’m going to go get one, too,” isn’t helpful. Unless you have a ton of cash lying around, it’s downright destructive. However, if you look at Joe’s nice car and think, “Hey, I like that car. I’d really like to have one like that someday,” it can be motivating.
If you really love Joe’s car, it can be a reminder to you every day that you need to get your finances into good enough shape that you can easily afford that car. Seeing Joe drive by your house every day can serve to remind you that you need to pay off that credit card that’s been hanging over your head for five years. Maybe it reminds you to forego some other unnecessary expenses so you can save more for the car. Maybe your envy of Joe’s car encourages you to go back to school and finish your degree so you can get a higher paying job. Whatever happens, if your envy leads you to make positive financial changes, that’s a positive use of the emotion.
Be careful whom you envy, though. You want to envy people who really have their financial acts together. Envying the person who has a cool car and big house and a negative net worth isn’t good. You can be like that, too, if you’re willing to take on enough debt. But you don’t want to be that guy. You want to envy the people who have nice things and good lifestyles but yet live well within or below their means. While it can be hard to know the health of someone else’s finances, you can usually pick up a clue or two by their complaints or stress levels.
Of course the car in my example may not be something you would ever envy. Maybe you envy a nice home, or two-week vacation at a spa resort. Maybe you envy more intangible things like being able to retire early or how some people seem to breeze through financial emergencies that bring other people to tears. Whatever you envy in others can be motivating to you. As long as you don’t just try to blindly compete, you can use your envy to better your financial situation. Ask yourself, “What do I need to do in my own life to achieve that level of freedom or have those kinds of possessions?” If you are honest with your answers, you’ll create a blueprint for financial success.