Can money buy happiness
can money buy us happiness
Money can’t buy happiness… or can it? A study in 2010 by Princeton University has suggested that having a bigger wallet may be the reason for having a wider smile, but, only to a certain degree. The study High income improves evaluation of life but not emotional well-being by Kahneman and Deaton shows us that an increase in income doesn’t improve emotional well-being however there is a positive correlation between income and life evaluation. So let’s look at the two types of wellbeing in more detail.
These are two aspects that the study looked at of subjective well-being (SWB) which is a self-reported form of wellbeing often carried out by questionnaires
- Emotional well-being: Is the frequency and intensity of someone’s quality of everyday experiences for example joy, anger anxiousness, affection and sadness which contributed to them feeling pleasant or unpleasant.
- Life evaluation: Refers to someone’s thoughts about their life when they think about it, a longer time scale of their whole life.
The scientific findings were that the person’s life evaluation steadily rose with the increase of yearly income however, emotional well-being (a person’s quality of everyday life) capped at $75,000 per year, meaning that if they earnt more than $75k annually their emotional well-being would not improve.
The cross sectional study also found that there was a correlation between lack of money and both life evaluation and emotional well-being. As income decreased from $75,000, the subjects reported lower levels of “happiness” and increase levels of sadness and stress.
The reasons for higher and lower levels of emotional well-being and life evaluation due to income may be correlated to Maslow’s hierarchy of needs. Although it is a bit outdated theory, if you think about it, if you have no money, you won’t be able to fulfill even the most basic levels of the pyramid.
There is some newer research coming from the Harvard business school which looked at various factors of the life’s of 4000 millionaires from age to income. The researchers (Donnelley and Grant et al) concluded that the two biggest contributions to happiness in their study were:
- Earring your wealth rather than inheriting it.
- Having a net worth of 10 million or more.
Now, you might be looking at these studies and thinking “I best get my butt into gear and do some work” great! Here’s some books for you to read to give you a heads up in earning a little cash.
You can also find some great books on audible so here's a link to a FREE TRIAL!
But, 10m is a long way off and let’s be honest, you’re not going to make all of that overnight, so you shouldn’t just rely on the findings of these studies to warrant being happy. this poses the question…
How can you use money to be happier?
From what you’ve just read it would suggest that money can’t really buy happiness, or at least only to a certain level but don’t worry, there’s more to the story than that. Research has suggested that money can buy happiness as long as you are spending it right. it’s not necessarily how much money you have in the bank or how much money you make, but, happiness can be increased by how you use the money that you have available.
The next time you go to buy a coffee from Starbucks, maybe think about paying for your friends or even a strangers as well as your own. You may have heard the saying it is better to give than receive and evidence might just back this old wives tale!
A study at the British Columbian University found that students who were asked to spend money on someone else felt happier than those who were asked to spend it on themselves. No matter how much money was used didn’t matter and similar results could be seen across many other countries.
With Christmas being right around the corner and at the time this blog is being posted it's Amazons black Friday week deals, it would be a great time to start building some presents before it's too late! If you use this link I will make a small commission which I would be very thankful for.
Although looking after number one (you!) has been a strong part of evolution and survival, so has generosity. Giving is a great thing to do but, it might be a more “selfish” thing to do than we originally thought, giving to others actually fills our brain with all them tasty feel good chemicals like dopamine, making it a very rewarding activity to indulge in.
A study found that when people donated to a food bank whether they wanted to or not, their reward systems in their brain would light up on an MRI scan.
If you’ve gone through a bit of a rough time, maybe through work, loss of a loved one or a breakup, your friends and family will often tell you to go and treat yourself, whether that’s buying a new handbag or getting your hands on the latest technology, however studies have suggested that this may not be the best idea to improve how you are feeling.
One study from Carter and Gilovich showed us that when people are asked to think of either an experience they had brought to make them happy or a materialistic good to make them happy, they found that experiences had a greater impact.
Some theories suggest that when we buy things to do, we can always relive the emotions in our memories. Another reason that buying products may be worse, is that after breaking the bank we may feel guilt as the money could have been used better.
What makes you happy
All of the other examples suggest that you have to spend money on other’s or experiences to be happy and that's the only way however, that is a bit vague and not necessarily true, Buying things ourselves can bring us joy it just depends on your personality and interests. Take me for example, buying a course to further my knowledge in business or buying myself the bluezone recipe book would make me a lot happier than buying tickets to a rock concert (experience) as I don’t have an interest in that genre of music. There’s no set guidelines for where you should spend your money, it’s more that you should spend your money on what you enjoy as an individual, there’s actually a well established theory in psychology that helps us understand this better called…
This is the idea that the things that fit into people’s life’s makes them the happiest, for example, being in a relationship with someone who is a “psychological match” to you will make you happier and ultimately have a better relationship. The question is could this theory be applied to the relationship between money and happiness.
A study by Sandra Matz et al found that personal fit does apply to money and happiness. They conducted a study with pupils from Cambridge University and split them into two groups; introverts and extroverts, then students from both groups either received a voucher for the student bar or a voucher for a bookstore (stereotypical voucher for either introverts/extroverts). They found that introverts who read a book we’re a lot happier than their baseline happiness and extroverts were slightly happier but, introverts who had to go to the bar were actually less happy than when they started and as you probably guessed, the extroverts was not only soaking up the alcohol but happiness too! The hypothesis of this study has been repeated and shows similar findings. This shows us that happiness can be bought by matching what we buy, with our personality.
I think it would be great of you to donate some money of yours to charity. You can choose any you like however, I do have a few listed below which I think you will love. On behalf of the charities here I would like to say any donation (big or small) is truly appreciated by all that are involved and you are making a huge difference to the life’s of others.
Young minds: Help children and Young adults with their mental health, these are one of the the strongest fighters against the rise of childhood mental illnesses.
Shelter: We don't want anyone out on the streets this Christmas and this charity helps the homeless to get back on their feet.
Mental health foundation: Wants everyone to have the chance of having positive mental health by helping those who need it.
If money is a real struggle and you have non to spare, that’s not a problem, lots of charity’s rely on volunteers to help out so you could always offer a helping hand.
I didn’t want you to have all of the fun, so I myself have donated some money to these special causes as you can see below.
This is by no means bragging, I just wanted to show you that I actually have donated, I’m not just telling you to do it whilst I save up all my pennies for a rainy day.
Some of the links in this blog are affiliate links which means you can purchase the product and I will make a commission of it but IT WILL NOT be at an extra cost to you, any money I money I make through this is put towards the upkeep and improvement of this blog. Thank you in advance, Jake.
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