We have been told our whole lives that “money can’t buy happiness” but few of us believe it. Indeed, if you are ever a contestant on Family Feud and the question is “What would make you happier?” you can bet the top response will be “more money.” Richard Wiseman, in his great book 59 Seconds: Think a Little, Change a Lot, reports that “In survey after survey, the need for a fatter wallet consistently tops the ‘must have’ list for happiness.”
So it is clear that we think more money will make us happier, but will it? Looking at the 10 smartest things ever said about money and happiness will shed some light on this complicated question:
(1) Money Has a Role: “Of course, money plays a role in the happiness equation. To try and deny that link would be disingenuous, not to mention unbelievable. But it’s not as strong a link as you might think. Moreover, money can be a bigger cause of unhappiness than many other factors in your life. Let me say that again. Even when it’s working in your favor, money can’t make you completely happy. But it can – without a doubt – make you miserable. – Jean Chatzky
The reason we believe money plays a role in happiness is because – for better or worse – it does. It is not often the determining factor, but it does play a part, and learning what money can and can’t do will help you squeeze as much happiness as possible out of the resources you have.
(2) How Big a Role Does Money Play? “We think money will bring us lots of happiness for a long time, and it actually brings a little happiness for a short time.” – Daniel Gilbert
Overestimating how much happiness money brings leads to misplaced priorities and disappointment. Money has a role, but keep it in perspective.
(3) Money & Cake: “People who say money doesn’t matter are like people who say cake doesn’t matter – it’s probably because they’ve already had a few slices.” – Lemony Snicket
If you are struggling to get enough to eat or keep a roof over your head, more money will absolutely buy more happiness.
(4) Wealth & Happiness: Before we set our hearts too much on anything, let us first examine how happy those are who already have it. – Francois de la Rochefoucauld
And what do the extremely wealthy say about money and happiness?
“The care of $200 million is enough to kill anyone. There is no pleasure in it.” – W.H. Vanderbilt
“I am the most miserable man on earth.” – J.J. Astor
“I have made millions, but they have brought me no happiness.” – John D. Rockefeller
“Millionaires seldom smile.” – Andrew Carnigie
“I was happier when I was doing a mechanic’s job.” – Henry Ford
“Show me someone who thinks money buys happiness, and I’ll show you someone who has never had a lot of money.” – David Geffen
“Money doesn’t make you happy – it makes you unhappy in a better part of town.” – David Siegel
It is clear that no amount of money, by itself, will make you happy.
(5) The Price of Happiness: If happiness has a price tag, it’s probably about $75,000 a year. – Article in The Week
The article gets the price of happiness from a study performed by Princeton researchers economist Angus Deaton and Nobel-prize winning psychologist Daniel Kahneman. The study found that day-to-day happiness increases as income increases, but only up to about $75,000 dollars per year. Beyond that, more income does not appear to be related to greater happiness. So it looks like you can buy at least some degree of happiness, and the price is surprisingly affordable.
(6) Materialism & Unhappiness: “…not only does materialism not bring happiness, but it’s been shown to be a strong predictor of unhappiness.” – Sonja Lyubomirsky
Lyubomirsky, in her book The How of Happiness, goes on to reference an ongoing study of students who were freshmen at elite universities in 1976. Those with materialistic attitudes (making a lot of money was very important to them) as 18-year-olds were less happy with their lives two decades later than non-materialistic students. It appears that the very belief that money can buy happiness can be a strong factor in making you unhappy.
(7) Houses & Happiness: “A small house can hold just as much happiness as a big one.” – Chinese Proverb
In their fantastic book Happy Money: The science of Smarter Spending, Elizabeth Dunn and Michael Norton tell of a study that measured people’s happiness both before and after a housing upgrade. If you asked them specifically about their new houses after the move they reported being thrilled with them, but if you asked them about their overall happiness, it was unchanged from before the move.
I suspect the same pattern would hold with cars and other major purchases. Even if you absolutely love what you bought, it is unlikely to change your overall level of happiness.
The findings from this study would be obvious to comedian George Carlin, who said, “Trying to be happy by accumulating possessions is like trying to satisfy hunger by taping sandwiches all over your body.”
Like nourishment, happiness has to come from within.
(8) Money Rich & Time Poor: “Greater material affluence may fail to yield to more happiness in part because of the diminished time affluence it often brings.” – Elizabeth Dunn and Michael Norton
In Happy Money Dunn and Norton write that the material wealthy report being extremely time poor. It has also been shown that having some free time is necessary for happiness. Therefore, for those who can afford it, using money to buy time can result in a significant happiness boost.
Additional Reading: Happy Money: Principle Three – Buy Time
(9) Stuff or Stories? “You can only have so much stuff but you can never have too many stories.” – Paul Sullivan
Experiences create stories and are much better at promoting happiness than shiny objects. Why? Stuff breaks, wears out, gets lost, or becomes obsolete while stories just get better with time. If you want to boost your happiness, buy experiences.
Additional Reading: Happy Money: Principle One – Buy Experiences
(10) Giving & Happiness: “The amount of money [people] spent on themselves was unrelated to happiness. What did predict happiness? The amount of money they gave away. The more they invested in others, the happier they were….Amazingly, the effect of this single spending category was as large as the effect of income in predicting happiness. – Elizabeth Dunn and Michael Norton
The quote above describes the results of a survey of 600 Americans. Similar results have been reported throughout the world. Indeed, citing the results from a study of people in 136 countries Dunn and Norton report that donating to charity increased happiness as much as doubling income. So if you want to be as happy as you would be if you were twice as rich, give away some money.
Speaking of this connection between giving and happiness Albert Schweitzer added, “I don’t know what your destiny will be, but one thing I do know: The only ones among you who will be really happy are those who have sought and found how to serve.”
Additional Reading: Happy Money: Principle Five – Invest in Others
Money and happiness have a complicated relationship. They are not unrelated but the correlation between them is not as strong or as lasting as we expect it to be, and being happy requires work in areas of life that have nothing to do with money.
This poem by the great author “Unknown” is a timely reminder of money’s limitations:
Money can buy a house, but not a home; Money can buy a bed, but not sleep; Money can buy a clock, but not time; Money can buy an education, but not wisdom; Money can buy sex, but not love; Money can buy fun, but not happiness.
We are all participating in that great human endeavor the pursuit of happiness. Understanding what money can and can’t do for you in this pursuit will increase your chances of catching it. Don’t make money either more or less important than it is. Keep perspective, stay balanced, and enjoy the journey!
Additional Reading: The Secret Keyhole: Unlocking the Door to Happiness