Does More Money Really Make You Happier?
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Often times we hear people say “if I only had more money in the bank” or “if I only made more money at work, then I’d be happy!”
But does more money really make people happy?
While the short answer is probably “yes,” there’s a little bit more to it. In fact, research has shown that while more money can make you happy to a certain extent, it certainly does not provide the type of nirvana or euphoria one might think or expect it to.
With this in mind, let’s look a little more deeply at the correlation between money and happiness.
Will Earning a Greater Salary Make You Happier?
- Obviously, your salary has a big impact on your quality of life as it determines everything from the kinds of food you eat, to where you live, and the car you drive.
- A Princeton study, however, suggests happiness only increases with your salary up to a certain point.
- According to the study, happiness increased with salary up to $100,000.
- Beyond this point, the correlation between salary and happiness actually decreases.
- In other words, above a certain level more money doesn’t actually yield more happiness.
- One interesting side note, however, is that the amount of money people think they need to earn to be happy varies based upon income level.
- For example, people making $30,000 per year thought they’d need to increase their annual salary to $50,000 to be happy.
- Similarly, those earning $100,000 per year estimated a yearly salary of $250,000 would make them happy.
- In short, people always think they need a little more money to be happy.
Will Being a Multimillionaire Make You Happier?
- A 2017 study looked at the happiness of multimillionaires.
- In conducting this research, 4,000 millionaires in the U.S. were researched with their “life satisfaction” calculated through lifestyle scores.
- The study found that, as with “average Joe’s,” there isn’t much difference between the happiness of multimillionaires until we get to those worth over $10 million.
- That said, the research found even these “deca-millionaires,” if you will, aren’t significantly happier than others.
- So, it seems even multimillionaires aren’t significantly happier than people making average income.
But What if We Look at How These People Came to be Rich?!?!
- Will Inheriting a Fortune Make You Happier?
- The previously noted 2017 Princeton study found people who inherit fortunes weren’t actually much happier than they were prior to receiving their inheritance.
- In fact, the study found those who inherited their fortune were less happy than those who had earned it.
- Will Winning The Lottery Make You Happier?
- A recent study showed individuals who won at least $200,000 in the lottery, experienced greater stress in the year they won it.
- Two years after winning the lottery, however, they were more likely to be happier than if they had not won any money at all, but not significantly.
- Another 2018 review found moderately sized winnings, those up to $100,000, may increase happiness, however, not to the level you may think.
- Overall, winning larger lottery prizes showed no substantial increase in happiness.
Will Spending Money Make Me Happier?
- Studies have shown that spending money, per se, does not necessarily make you happier, however, how you spend it can.
- For example, research has shown spending money on “experiences” is the best way to bring happiness.
- Spending money on other people was also found to be a happiness builder.
- In fact, spending as little as $5 on others can bring more happiness than spending the same amount on yourself.
- Another way spending can bring happiness is by paying others to do jobs you don’t enjoy – such as house cleaning and yardwork – as well as purchasing equipment that makes jobs easier or quicker – like a dishwasher, washing machine or automatic sprinkler timer.
- These items bring more happiness because it then allows us to spend more time doing the thing we enjoy like hobbies, hanging out with friends and family, movies, sports, music, etc.
- So, essentially, spending money just to spend it does not make you happy but how you spend it can.
Will Paying People More Money Make Them Happier?
- Simply stated, there’s no real proof raising salaries makes people happier.
- Obviously, paying people well and in a manner consistent with their contribution to the organization is the right thing to do.
- Nonetheless, studies have confirmed workers – at all levels of an organization – are happiest when they feel they are valued and contributing to the overall success of the company.
- In other words, in the work environment it’s not money that motivates people, but rather the belief they are respected and appreciated.
Remember, the key to happiness is realizing the best things in life – walking, jogging, hiking, exercising, playing in the yard, conversation, worship, smiling, etc. – are free! So, instead of thinking more money is the answer to bringing you happiness, focus on the things in life that are free and truly make you happy!
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