There have been many questions on the web asking, “Does money buy happiness?” The answers are also so diverse. I reviewed multiple websites, including Quora and Reddit. I was amazed to learn about the answers. What I am presenting you today is:
- People’s opinions (without their identity),
- Science of happiness and lastly
- Something questions and thoughts for you to ponder to decide yourself
“I don’t look at price tags as often, nor at the rates on the menu. I plan my finances in advance, save & invest as much as I can, and spend judiciously on the things that I love. I worked my ass off to be here honestly, and if you are not born in money and come from a middle-class family, you’d know that MONEY DOES MAKE YOU HAPPY.
It gives you mental peace.”
“Simple things like not looking at price tags or seeing the price of the dishes on the menu means a lot, especially when you come from middle class families…. Not to mention the sheer respect having more money brings out from the people around you (yes, that’s how the world works). Personally for me. It means freedom.”
“No. Money does not buy happiness. I happen to know several multi millionaires and one billionaire. None of these people are truly happy despite their immense wealth.”
The web is full of such responses. You could have a great debate over this. All of the above appears like a valid answer. But what do you think? I would love to hear your comments. You can write them in the comments section below.
How is happiness defined?
When you ask people what they want to be, most of the time they say, “I want to be happy.” They want to lead a happy life. While happiness is the major goal of everyone’s life, what does “happiness” truly means? For some, it means being spiritual and building a connection with God. For others, it is mainly individualistic. It is more about a feeling of satisfaction that people gain after reaching a goal or acquiring an object. One feels happy when they acquire a nice car, expensive mobile phone, or a house.
The scientific term coined by psychologists for happiness is “Subjective Well-Being.” There are many tools that can be used to measure this – Surveys of Subjective Life Satisfaction, U-Index (captures the periods of a day in which participants felt that they were in an “unpleasant state”), Brain activity, etc.
United Nations uses the Survey of Subjective Life Satisfaction to measure the Happiness index in various countries. They have published World Happiness Report for 2021. Finland, Denmark, and Switzerland rank top in the Happiness ranking, and Rwanda, Zimbabwe, and Afghanistan rank lowest. The United States is ranked 19th on the list.
What evidence says about “money buy happiness”?
Researchers looked at about 450,000 responses to the Gallup-Healthways Well-Being Index survey – a daily survey of 1,000 US residents conducted by the Gallup Organization . They found that Emotional wellbeing improves only until an income threshold of about $75,000 and after that it plateaus.
People with higher income do consider themselves to be more satisfied with their lives than do persons with low income. Compared to the rich, a poor person constantly has to think about money even for basic necessities of life. Having additional income strongly raises life satisfaction for people with limited financial resources. But once certain affluence is reached, additional income does not add to additional happiness. A millionnaire’s life satisfaction rises only little when their income further increase.
The human mind adapts to situations well
One of the unique things about the human mind is that it is very adaptable. It gets used to stuff very fast. It is also resilient. This is our protective mechanism. Let’s say you just bought the latest mobile phone. You definitely feel satisfied and happy. But, how long do you feel happy? For a week, two weeks, or a month? I bet this happiness goes down as days pass. You get used to this new mobile phone. It does not give you the same happiness as it gave you the first day. Soon, you see another item that you want. You then focus on that thinking that if you get this new material possession, you will be happy. This cycle continues. The happiness associated with materialistic things is short-lived.
It is different from some needing money to buy food or clothes. In this situation, the money buys necessity and it does provide more satisfaction than someone who is looking for only shiny and latest items.
Instead, if one invests time and effort in experiences – spending time with family, going on a trip with friends, having a walk on the beach with their spouse, organizing a family picnic; you also feel the satisfaction and feeling of happiness. But, since the experiences are not material, you can not get used to them. In fact, even thinking about those events, provides you happiness. This happiness lasts longer.
Conclusion – “Does money buy happiness?”
There is no absolutely clear answer to this question but from studies and data presented, we can infer that money does buy happiness when it fulfills the basic necessities of living – food, clothes, house. Once you reach a certain level of affluence, having more money does not really increase happiness much.
To get long-term happiness, one should focus their time and efforts on creating happy memories – invest in experiences more than materialistic things.
I love to hear from you! What is your opinion? As I said, there is no absolute answer to this question.
- Kahneman D, Deaton A. High income improves evaluation of life but not emotional well-being. Proceedings of the National Academy of Sciences Sep 2010, 107 (38) 16489-16493; DOI: 10.1073/pnas.1011492107
- World Happiness Report 2021.
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