Money Does Make You Happier, But Not Happiest
Money, it's what makes the world go 'round, though many people wish that wasn't the case. Money is often a pain point, as one bad day can have us spending beyond our means in order to stay afloat, stay fed, or stay housed.
In times of stress or struggle, many turn to the saying "money can't buy happiness" as a way to remind themselves or others that their problems wouldn't be solved with more money alone. Does that saying still hold water, though? Does money really have no impact on our happiness?
Money and purpose tend to go hand in hand, as we often believe once we find our true calling or our life's purpose, that money will follow, that we'll find a career that fits what we need to be doing. That can be true, but where do you start? How does one find their purpose?
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Money And Joy
The phrase 'money doesn't buy happiness' has been around for probably as long as there's been class disparity, stretching over centuries, reminding us that we need not be among the world's top earners in order to enjoy life.
Recently, though, there's been some tension with that phrase. For many who struggle with finances, money certainly would buy happiness in the form of peace of mind, striking an entire area of worry from the mind.
So, is there actually some truth in that age-old saying? Can money really buy happiness?
To What Ends?
To some degree, yes.
There was a famous study from 2010 regarding this very topic. Daniel Kahneman and Angus Deaton from Princeton University found that day-to-day happiness rose as someone's salary increased but then plateaued at around $75,000 USD per year. However, a more recent study from the University of Pennsylvania's Matthew Killingsworth in 2021 found that plateau didn't exist, with happiness continuing to grow with a salary well beyond $75,000.
So, the two studies battled it out. Sort of.
A Final Conclusion
The three original conductors of those two studies (along with a few more colleagues) took another, broader look at their data and reevaluated what it all meant. What they discovered really is a matter of perspective.
On average, yes, levels of happiness do increase alongside salary raises, but they found a new plateau. At around $100,000, which is more than the original $75,000, happiness becomes a new beast that cannot be solved with money alone.
That's sort of where the crux of this discussion rests. For those who live below the poverty line, money can absolutely be a catalyst for happiness (albeit to varying degrees), but what about those who are well off? What helps them when they're unhappy?
It Runs Out
Not more money, that's for sure.
It's also worth remembering that, of course, there's nuance. Money is not a blanket sadness cure for every person who makes under $100,000 a year. As Professor Barbara Mellers, who served as an arbiter during this updated study, explained, "The function differs for people with different levels of emotional well-being." The unhappiest among their study sample contently plateaued around $100,000, as the revision suggested, while the happiest actually saw their happiness continue to increase above $100,000, but only by a marginal amount. Beyond that, money had no impact on happiness at all.
Some, But Not All
Something that all conductors of this study wanted people to remember is that money, though it can impact one's happiness, is not the only thing that does so. "Money is just one of the many determinants of happiness," said Killingsworth in the project's conclusion. “Money is not the secret to happiness, but it can probably help a bit.”
But let's be honest here, not everyone is going to be able to make it to a $100,000 per year salary. In fact, most people won't. What do we do then? Can money still make you happier if you're making anything below the happiness plateau?
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Where Your Money's Going
It can, you just have to spend it correctly.
A 2020 study from New York University looked into what sorts of habits and activities contribute to happiness. At the top of the list, far above all else, was experiences.
As co-author Catherine Hartley wrote, "Our results suggest that people feel happier when they have more variety in their daily routines–when they go to novel places and have a wider array of experiences."
Places And People, Not Things
When most people envision what they would do if they had more money, a lot of it comes down to buying things. People want a new car, the latest phone, a high-end computer, and a big house. While not entirely unreasonable if these things would better your life somehow, this study proved that real happiness is found in things we do, not the things we own.
"Collectively, these findings show the beneficial consequences of environmental enrichment across species, demonstrating a connection between real-world exposure to fresh and varied experiences and increases in positive emotions," wrote co-author Aaron Heller.
Near Or Far
This could include vacations, festivals, day trips, trying new restaurants, or any other new experience that would bring variety to your life. Bonus points if you can bring other people along, making new, happy memories that will last a lifetime.
While spending money on experiences will be better for you than spending money on things, these experiences don't have to cost you anything, either. There are tons of things you can do for free within your own city that will contribute here.
Look Beyond Your Bank Account
A simple walk around the neighborhood, a visit to a local fair or convention, or even taking a different commute to work will invite freshness into your life needed to keep your spirits up.
Money struggles do a good job of keeping people feeling trapped, weighed down, and tired. Even just thinking about making lifestyle changes like this when you're living paycheck-to-paycheck can seem pointless. However, through it all, it's important to remember that people telling you that 'money can't buy happiness' are lying to an extent, but also that money isn't the only place that happiness resides.
There's more out there for you that you will find joy in. You just have to go looking for it.
