When I was a kid, I was always amazed at the number of wrapped packages surrounding the Christmas tree at our neighbor’s house across the street. Just like us, the Odom family had three kids and two parents in the house. By all appearances they were no wealthier (or, to be more accurate, no less poor) than we were – except that by mid-December, practically every inch of floor space in their family room was covered in Christmas gifts. I wondered how Santa could find room to leave even more presents on Christmas Eve.

I eventually learned that a person reveals a lot about himself when he reveals his relationship with stuff. More than 40 years later, one of the Odom kids explained that he believed that his parents went to great effort to fill their house with as many Christmas packages as possible as a way to (over?) compensate for their modest financial means.

Some people try to fool their kids with stuff, while others are busy trying to fool or compete with their neighbors.

In his new book “The Art of Spending Money: Simple Choices for a Richer Life,” Morgan Housel explores how our spending habits are deeply influenced by psychology—greed, envy, social pressures (both real and imagined) and our self-identity. While there are hundreds or thousands of books on how to earn, save or invest money, Housel’s book is one of the few that speaks directly to how we spend it. Unlike investing or saving, spending money is more art than algebra. He challenges readers to consider whether they use money as a tool to build a better life or as a yardstick to measure success and impress others.

One of the best questions he poses in the book is, “what would you buy if no one knew what you purchased?” Removing the instinct to filter spending decisions through the eyes of others frees you to spend money in a way that is more liberating, more fulfilling, and more consistent with your core values.

I highly recommend the book.

Research repeatedly finds that once our basic needs are met, the correlation between happiness and income begins to break down. Contentment results much more from managing expectations rather than having the most gifts under the Christmas tree.

Envy and social comparison are insurmountable barriers to happiness. Your house may be larger than your neighbor’s, but no matter who you are, someone’s house is larger. Or their boat is. Or they have a larger beach home. Or a bigger airplane.

The liberating insight Housel emphasizes throughout the book is that the richest people aren’t the ones with the fanciest possessions, but those who have stopped measuring their success against others.

David Moon is president of Moon Capital Management. A version of this piece originally appeared in the USA TODAY NETWORK.