Can Money Buy Happiness? Let's add that up
'Tis the season to ask: can money buy happiness?
And if so, how much does it cost?
Recent research exploring the link between income, purchases and happiness has economists and psychologists weighing in on what adds up when cash is king. The conclusions may seem obvious at first. But dig under the surface and there's real gold: the link between money and happiness is richer than you think.
What impacts your happiness with money - more than the size of your income - is how your spend it. And your attitude towards money when you spend it, save it, or fret about it, counts even more.
And while "I can't afford it," comes up most often when you think about vacations, concert tickets or other higher-cost experiences, you might want to rethink that.
Here's why...
Numerous studies show that experiences give people more lasting pleasure than things.
Yet the majority of people are still quick to deny themselves annual vacations, concert tickets or yoga memberships.
In a study published earlier this year, Prof. Howell, associate professor of psychology at San Francisco State University found that people think material purchases offer better value because experiences are fleeting, and material goods are tangible.
But what they feel about these purchases is the exact opposite.
In fact, Prof. Howell found that when people looked back, they said the experiences actually provided better value.
In other words, spending on experiences buys you more happiness in the long run.
Cornell University psychology professor Thomas Gilovich reached similar conclusions. “People often (think), If I buy this thing, at least I’ll.. have it. That is factually true, but not psychologically true. We adapt to our material goods.”
That means that Gucci purse or new Audi provides an initial thrill, but we soon come to take it for granted. We go unconcious around our possesions. It's not a problem inherent in the possessions; it's our mindset around them.
Possessions are not the only things we take for granted. People and relationships - we often neglect to appreciate those too, especially ones that mean the most to us.
We even forget to appreciate ourselves, the holder of all the experiences we cherish. Without us, there would be no experiences to enjoy.
Experiences, it turns out, give us a greater sense of connection and form a bigger part of our sense of identity. If you’ve climbed in the Himalayas, you can be proud of your accomplishment indefinitely. Your experiences can help you to feel good about who you have become, in fact often helping to shape who you now are.
Prof. Gilovich and colleagues also showed that we also get more pleasure anticipating experiences than anticipating the acquisition of material things. People waiting for an event were generally excited, whereas waiting for material things “seemed to have an impatient quality.”
As in, "Universe, where's my stuff already?"
Wake up and Smell Your Stuff
If one of the main reasons material things don't keep us happy is that we ignore our stuff, the answer would be obvious: wake up and actively practice appreciation and gratitude for what you have.
Sound familiar?
It could be as simple as setting aside time every day to “count your blessings.” Or keeping a daily written journal. Or openly expressing your gratitude to other people. Find a way to remain conscious and avoid neglecting the treasures in your life.
And don't let your gratitude become gratuitious: if appreciation becomes lip service only or a stale routine, just like your material goods, it will no longer have much effect on your life.
You can trick yourself awake by playing it as a game. For instance, if you keep a painting hanging in the same spot on the same wall, you’ll stop noticing it after a while. But swap it with a painting from another room, and you’ll see each of them with new eyes. Sharing your possessions with other people works beautifully, too.
Take my money - Please.
Studies also reveal this golden paradox: although having more money tends to enhance our sense of well-being, we are happier when giving money away.
That’s the finding from a series of studies by Prof. Dunn. She began by handing out cash to students and telling some to spend it on themselves , and others to spend it on someone else.
Those who spent money on other people were happier than those who treated themselves.
Prof. Dunn has since repeated the experiment in countries across the world, and looked at whether people were happiest giving away their own money rather than free money handed to them by a professor. She found that in countries as diverse as Canada, South Africa and Uganda, giving away money consistently made people happier. This was even true when people were giving away their own money, and even when they themselves were relatively poor.
The happiness of giving is not about the dollar amount, or in being able to afford it, but in seeing your positive impact on other people’s lives.
There is no small giving. And that's a huge revelation.
In other words, you always have enough to give.
Time is Money, Too
Using money to buy yourself time is another successful happiness purchase. For instance, Prof. Dunn says, by outsourcing tasks you dislike to hire, eelancers and virtual assistants online to help you with either regular administration or individual tasks.
Or you could just hire the whole world with the Universe List Process.
What is the Happiness Value of Money?
Those in the field of money-research divide happiness into two components
The first measure of happiness is “evaluative.” Prof. Lyubomirsky defines it as “a sense that your life is good—you’re satisfied with your life, you’re progressing towards your life goals.” That’s the measure used by economists Justin Wolfers and Betsey Stevenson, who have conducted extensive research comparing economic data and happiness surveys across the world.
“We found very clear evidence that in just about every country around the world, rich people are happier than poor people,” says Prof. Wolfers. “And people in rich countries are happier than people in poor countries.”
The other component of happiness—“affective”—looks at how often you experience positive emotions like joy, affection and tranquility, as opposed to negative ones, explains Prof. Lyubomirsky.
“You could be satisfied with your life overall but you may not actually be happy at the time,” she says. “Of course, happy people experience negative emotions, just not as often. So you have to have both components.”
Daniel Kahneman and Angus Deaton of Princeton University found that when they looked at affective measures, happiness did not rise after a household reached an annual income of approximately $75,000. (They did, however, find a consistent rise in overall life satisfaction, matching the results of Profs. Wolfers and Stevenson.)
Don’t Sweat over Spending
Interestingly, all the researchers agreed that spending "more than you can afford" is a stressor.
The common wisdom is to avoid debt, live within your means, and be sure to be "saving for that rainy day" by creating a safety net made of money.
But what is the price of living in fear, worry and belief in limitation?
What is the most profitable money mindset to approach all spending and giving?
What is the mindset of abundance?
The emotion buried under the common advice to "save for your safety," set aside money "for emergencies" and live meager can be summed up in words like: fearful. Worried. Distrustful. Limited.
Can this mindset ever align with abundance?
And if you are fearful rather than relaxed about money, it seems that having money around would not lead to happiness no matter what you spent it on.
Which explains perhaps why giving it away seems to make everyone in this study happier.
Money, like everthing else, begins in the mind. Your attitudes about money may have come at an early age, from hearing your parents and family worry about the lack of money. But you can expand your mindset about money; you are not stuck in a poverty mentality and many people who break free come from meager upbringings.
How do they do it?
Invest in yourself. Your beliefs may shape your reality about money but beliefs are just thoughts you choose to think over and over again. And you are in complete control of the thoughts you choose. The important thing is to examine your thoughts and beliefs and see if they are ulplifting you, or holding you down.
The money in your life will be an exact match to your money mentality. Since you can change your thoughts and expand your beliefs any time with no investment, abundance is an equal opportunity for all no matter what your current income, past experiences, or financial background.
How do you begin?
Start by appreciating what you have and noticing how much more of it comes your way. Once you can see that your beliefs form the foundation of your experiences with money, by staying conscious and appreciative, you'll be able to feel more happiness about money no matter what how the balance on your bankbook may fluctuate.
Limitless happiness
When it is happiness that hangs in the balance of your mindset, you can use money to add to rather than subtract from your overall experience of the richness of life.
Rhonda Uretzky, E-RYT
Reader Comments (8)
The first thing that comes to my mind is NO. Money can't buy happiness. The key is to feel the thrill of your experience when you get something you really want. It could be different for different people. Things for some people, giving for others, or real life experiences. Therefore, happiness comes from within. Money could be an easy link to tap into that great happy feeling. However, it is not the source. The source is you and how you feel about it :).
Consider this Alfia: if buying things makes you happy and money buys things then....money buys happiness. Yes? It may be that "happiness" is what you project onto the "things" bought, but it is then happiness made accessible to you through money. All things are empty until you decide what they shall be for you. Money has no meaning except the meaning you give to it - just like everything. I choose to use money for happiness therefore, for me, money means happiness. And that makes me happy about money and all it can do for me and others
I agree with both of you! I do see what you mean, Rhonda - that money is whatever you make of it, like everything else in this world. And if you make happiness out of it, than money will indeed bring you happiness!
Maybe what Alfia is referring to is joy - a constant presence of something deeper than happiness (I relate happiness to a emotion that comes and goes for as long as you let it, and joy as a sustaining presence of being)…
Not money nor anything else can buy you that state of peace and joy. That is a decision for yourself. But from that place of peace and joy you can decide what everything else in this world can bring to you, money being one of them!
i have read this aticle a couple times now and i have shared it with my friends and family. I do believe that money can buy happiness. if u are not focused on the lack of money and appreciate what u have then only more good feelings and things will come your way no matter what ur bank account balance is.
I agree Danielle! Money is not the root of all evil nor is money the answer to everything: money is money! As such, it offers the ability to make purchases; and everything you buy is because you suspect it will feel good. So - use money to feel good! If that means money is "buying" happiness, so be it! Enjoy it any way that feels good to you. It's time for us to drop the guilt about having and spending money, no?
I also agree with you, Grace. There is a deeper state of contentedness that is not dependent upon your bank account, your boss' mood, the weather, whether or not you flight leaves on time...these are illusions of fluctuations in the experience of living. There is within each of us the presence of unending peace, that place of freedom that is not dependent upon conditions. And there is something that can "buy" you a ticket to that place: your choice. You may make that choice countless times a day, but it is your make.
YAY! This research supports what Rhonda has been telling us all along in this TT.
I enjoyed reading the above posts and I believe money cannot buy happiness. I agree with Alfia in that happiness comes from within.
Everyone carries a certain demeanor about them. I find positive, optimistic people tend to be happier, they possess a bright radiance and energy about them, regardless if they are rich or poor. So much that my goal is to be this person. I feel good when I'm around people like this and want to make others in my presence feel this also.
I also agree experiences are much richer and provides more lasting happiness than things. This is why i always plan vacations, weekend trips, seeing concerts and doing stuff with friends, family, etc. I find if i have something to look forward to, it makes me happier and puts me in a better mood overall.
San Luis Obispo, a city between San Francisco and LA is named the happiest city in America. I've always wanted to visit and am now planning my trip!
Interesting, Tina - by what standards of happiness is San Luis Obispo judged happiest city in the US?
The following are the top five reasons why San Luis Obispo is the happiest city in the US.
1) San Luis Obispo is social. Residents love the outdoors, hanging out with friends, spending time downtown and happy hours.
2) San Luis Obispo truly has farm to table lifestyle. There are four farmers markets and one every day of the week, so access to fresh foods is easy. It is home to some of the most amazing restaurants, world-class chefs and finest wines anywhere.
3) San Luis Obispo is happily active. It was cited as one of the most active cities in the nation. Many residents bike and walk to work every day. There are more than 6,500 acres of protected open space for hiking, biking and yearlong outdoor activities.
4) San Luis Obispo supports the arts. It is home to a state-of-the-art performance facility that exposes the Central Coast to varied, high quality arts events designed to serve diverse audience interests.
5) San Luis Obispo weather is as pleasant as it gets. It has one of the world’s most comfortable climates. The weather is perfect 306 days of the year. The summers are mild, with daytime highs in the low 80s, and cool evenings. Winters are even better with daytime highs in the 60s and 70s, and crisp, clear nights. This perfect weather allows residents more social activity and being more active when residents of other cities in the nation are holed up inside.