The Wanting Gap
Why more money can still feel like not enough
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In the mountain meadows of western Canada, a male rufous hummingbird sets up a territory for the summer. It’s a bird with an absurd job description. Its heart runs at over a thousand beats a minute in flight, and it has to work its way through hundreds of flowers a day simply to stay alive. If it misses too many meals, it dies.
So the bird needs a shortcut. Memorising the exact yield of every flower in a patch that might hold thousands of them is a lot of work for something that weighs less than a twenty cent coin.
In 2022, a team led by Theo Brown at the University of St Andrews published a study in Proceedings of the Royal Society B that tested what that shortcut actually is. They trained wild rufous hummingbirds on artificial flowers that differed in one respect only: size. Same colour, same setup, one smaller and one larger. For some birds, the larger flower always held the sucrose. For others, the smaller one did.
Then the researchers changed the pair. They kept one familiar flower and put a brand new size beside it.
The birds flew past the flower that had actually been feeding them all week. They went instead to whichever flower was relationally correct, the bigger one or the smaller one, depending on what they’d learned. A bird that had been drinking happily from a particular flower for days abandoned it the moment something larger appeared alongside.
Nothing about that flower had changed. Same size, same place, same nectar. The only thing that changed was what was standing next to it.
Einstein has a lot to answer for
I own a T shirt claiming that Einstein worked out that E equals MC squared, and ever since then everything’s been relative. It’s a bad joke on a cheap shirt, and it’s also a fair description of how the human brain handles money.
We don’t experience wealth. We experience the difference between our wealth and something else. Usually somebody else.
The swap test
Morgan Housel has written about this more elegantly than most, and this article owes his thinking a genuine debt. He points out that 100 years ago, the richest man alive was John D. Rockefeller, whose fortune has been estimated at around three percent of American economic output. Scaled to today, you’re looking at a number with twelve digits in it. It’s the sort of figure that stops meaning anything.
Now imagine the offer. You can have Rockefeller’s fortune, on the condition that you live in 1926.
There are no antibiotics. Penicillin hasn’t been discovered yet, so an infected cut is a legitimate way to die, and no amount of money changes that. There’s no chemotherapy. No polio vaccine, no measles vaccine. No blood pressure medication, so the most common cause of death in the developed world is largely something you watch approach. Surgery happens with anaesthesia that would horrify a modern hospital. There’s no MRI, no CT scan, no ultrasound, so a doctor examining you is essentially guessing with confidence.
Outside the hospital, it’s no better. No jet travel. No television. No air conditioning in the house. No refrigeration in most kitchens. No internet, obviously, and no telephone call to another continent that doesn’t involve an operator and a small fortune. Life expectancy at birth in the United States sat somewhere in the fifties.
Most people, offered that trade honestly, say no. Twelve digits, and they’d rather keep their ordinary 2026 life with its bulk buy paracetamol and its vaccinated children and its ability to watch a film on a phone.
Which raises an obvious question. If an average modern life is worth more than the largest fortune of a century ago, why does an average modern life so rarely feel like it?
The brain has no absolute setting
The answer sits in the architecture. Human perception, across almost every system we’ve studied, works by comparison rather than by absolute measurement.
Put one hand in cold water and one in hot for a minute, then plunge both into a bucket of lukewarm water. The same bucket will feel hot to one hand and cold to the other. The psychologist Harry Helson built an entire theory around this in the 1960s, called adaptation level theory. Perception isn’t a reading of the world. It’s a reading of the world against whatever your system has recently been exposed to.
Money runs on the same hardware. When Daniel Kahneman and Amos Tversky published prospect theory in 1979, one of their central claims was that people don’t evaluate final states of wealth. We evaluate changes, measured from a reference point. Your brain doesn’t hold a figure representing how well off you are. It holds a comparison, and it updates that comparison constantly.
This is why a pay rise feels enormous for a while and then feels like your salary. The number didn’t shrink. Your reference point moved up to meet it, and the gap that was producing the good feeling closed.
It also explains a genuinely strange finding. In a 1998 survey, Sara Solnick and David Hemenway asked people at Harvard to choose between two hypothetical worlds. In the first, they’d earn fifty thousand dollars while everyone around them earned twenty five thousand. In the second, they’d earn one hundred thousand while everyone around them earned two hundred thousand. Prices were held constant, so the second world made them twice as rich in every way that buys anything. Roughly half chose the first world. They took half the money in exchange for being ahead.
That’s the hummingbird, in a suit, at Harvard. Flying past a flower full of nectar because something bigger turned up next door.
The Wanting Gap
I Call it the Wanting Gap: the distance between what you have and what you’ve decided you ought to have.
Your sense of financial wellbeing tracks that gap far more closely than it tracks the actual balance. Which produces an unpleasant piece of arithmetic. You can increase what you have and increase the gap at the same time, because comparison lifts the target faster than income lifts the total.
Ambition is great but setting your expectations too high is bound to lead to disappointment.
That’s how someone objectively comfortable ends up in what we might reasonably call psychological poverty. Not poverty in the material sense, which is a different thing entirely and I’ll come back to it. Psychological poverty is the experience of chronic insufficiency: the sensation of not having enough, running constantly, in a person whose bank account might say otherwise.
And it’s expensive in ways beyond the mood. Work by Sendhil Mullainathan and Eldar Shafir suggests that the feeling of scarcity consumes cognitive bandwidth. It narrows attention onto the shortfall and degrades the quality of decisions made in that state. A person who feels poor makes worse financial choices than a person who feels secure. The gap makes you miserable and simultaneously makes you worse at the thing that might have closed it. It’s a very nasty loop.
One of the cruellest features of the Wanting Gap is that you don’t set it. Your reference group does. Move to a wealthier suburb and you become poorer overnight without losing a cent. Follow different accounts and the target shifts while you sleep. The same person, with the same assets, can be rich or destitute depending entirely on who they happen to be standing beside.
Expectations as a debt
Housel has another framing that fits here, and again I want to credit it clearly to him. He describes expectations as a debt that has to be repaid before you get any enjoyment out of what you have.
His example is Amazon in 2021, when the company was at the top of the world and expectations were so high that merely excellent results felt like failure. His other is the Japanese stock market, which delivered spectacular returns until 1990 and then spent more than three decades going nowhere, repaying the excess. Nobody receives a statement for this debt. There’s no interest rate published anywhere. It’s still real, and it still has to be paid.
What I’d add is the psychological counterpart to Housel’s metaphor. In markets, high expectations become embedded in prices. In the mind, they can become embedded in the reference point. Once you’ve mentally banked an outcome as your new baseline, achieving it may feel less like a gain and more like confirmation, while falling short can register as a loss. The problem isn’t expecting good things. It’s spending them in your mind before they arrive. Once you’ve counted the win as already yours, success feels less like a gain and failure feels like something has been taken away.
Kahneman and Tversky also found that losses are felt considerably more intensely than equivalent gains. Raising your expectations converts a range of perfectly good outcomes into losses, without changing a single fact about the world.
Charlie Munger, asked what accounted for his contentment, said the first rule of a happy life is low expectations, and that unrealistic ones guarantee misery. Montesquieu got there three hundred years earlier in Persian Letters: “if we only wanted to be happy it would be easy, but we want to be happier than other people, and that’s almost always difficult, since we think them happier than they are”.
Note the second half of that. Not only do we compare, we compare against a version of other people’s lives that we’ve largely invented. The reference point isn’t just external. It’s inflated.
Where this argument stops
Arguments about relativity can curdle very quickly into something ugly.
If you can’t make rent this month, being told you’re richer than Rockefeller is worthless and slightly insulting. Absolute deprivation is real. It isn’t a reference point problem, it isn’t fixed by reframing, and no amount of historical perspective puts food in a fridge. Everything in this article applies above a threshold of material security, and plenty of people are below it through no failure of their own.
There’s also decent evidence that relative position affects health and wellbeing in ways that aren’t purely psychological, which means telling people their relative standing is imaginary isn’t honest either.
And comparison isn’t always a distortion. Noticing that a colleague doing your job earns thirty percent more is accurate and useful information. What causes the damage is comparing on an axis you never chose, against a group you never selected, using a target that moves every time you approach it.
Interrupting the loop
Comparison can be problematic but there are some things that you can do about it.
Compare backwards on purpose. Your default comparison set is horizontal. Everyone you measure yourself against is alive right now, and most of them were selected for you by an algorithm optimised for engagement. Once a month, deliberately compare vertically instead: against yourself five years ago, or your grandparents at your age. This isn’t gratitude journaling. It’s feeding a different input into the same comparison machinery.
Put a number on enough, and date it. An undefined target it is hard to hit and tends to drift. Write down what enough actually looks like, in figures, with today’s date beside it. Then when you revise it upward, and you will, you’ll have to do it consciously rather than by default.
Watch the target after a pay rise. The next time your income increases, note how many weeks pass before the new figure feels normal and you start eyeing something further along. Naming that moment as it happens is one of the few ways to see the gap widening in real time rather than reconstructing it afterwards.
Practise expectation hygiene. Assume investment returns will be mediocre. Assume the economy will muddle along. Assume nothing much improves. Housel’s point is that if your expectations rise more slowly than the world does, you get to enjoy the difference. If they rise faster, you spend your life in arrears.
Ask the invisible question before buying. Would I still want this if nobody could see it and I had no idea what anyone else had?
The flower that was always enough
The hummingbird isn’t being stupid. Relational rules are efficient, and in a meadow where bigger flowers usually do hold more nectar, the shortcut is sound engineering. It only fails when something appears in the environment that the rule was never designed for.
Ours has the same origin and the same flaw. Comparing yourself to the twenty or thirty people in your band was excellent information for most of human history. It’s less useful now that the comparison set includes several billion strangers, most of them presenting a curated version of a life they may not actually be living.
You’re reading this on a device that would have looked like sorcery to the richest man of 1924, in a century where a bacterial infection is an inconvenience rather than a funeral. That’s the flower. It’s full, and it’s right in front of you.
The only reason it doesn’t look like much is that there’s a bigger one, somewhere off to the side, that you’ve decided you can see.
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