Popular culture tells us we’d be happier with more money, but how much is enough? John D. Rockefeller had a tongue-in-cheek reply to the query, “Just a little bit more,” while an entire countermovement scoffs at the notion that joy and contentment can be purchased, arguing that money is not the root of all happiness, but of all evil.
What does psychology have to say on the subject? According to a new San Francisco State University study, both camps are partially right: money can lead to greater happiness for the person possessing it and those around them, if it is used to buy experiences, not possessions.
According to SFU’s February 7 press release, the study by Ryan Howell, an assistant professor of psychology at SFU, “demonstrates that experiential purchases, such as a meal out or theater tickets, result in increased well-being because they satisfy higher order needs, specifically the need for social connectedness and vitality — a feeling of being alive.”
The remainder of the release describes the study procedure:
Participants in the study were asked to write reflections and answer questions about their recent purchases. Participants indicated that experiential purchases represented money better spent and greater happiness for both themselves and others. The results also indicate that experiences produce more happiness regardless of the amount spent or the income of the consumer.
Experiences also lead to longer-term satisfaction. “Purchased experiences provide memory capital,” Howell said. “We don’t tend to get bored of happy memories like we do with a material object.
“People still believe that more money will make them happy, even though 35 years of research has suggested the opposite,” Howell said. “Maybe this belief has held because money is making some people happy some of the time, at least when they spend it on life experiences.”
“The mediators of experiential purchases: Determining the impact of psychological need satisfaction” was conducted by Ryan Howell, assistant professor of psychology at San Francisco State University and SF State graduate Graham Hill.
I know I feel happier when I spend money on dining out, movies, travel, or other experiences — shopping is fun too, but the excitement fades quickly after I’ve made my purchases — and I’m particularly interested to hear the thoughts of our blog readers regarding these findings. What is your reaction to this research, and how does it speak to your experience? Do you think more money would make you happier? Do you think it’s necessary to spend it on non-material experiences to maximize your happiness?
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19 Comments to
“Money = Happiness, But There’s a Catch”
I agree with buying experiences vs just having money collect dust in a bank account. I recently decided to use money to have life changing experiences. One of my latest mind blowing experiences was skydiving. I will continue to use my money to have new adventures one being flying a fighter jet.
AJ
I agree with that.
I think some material things can help you achieve happiness, like a house and car, e.g. Or an iPod.
But, for the most part, I’d spend my money on experiences… if I had any.
I agree, but i think that the reason some poeple think money will make them happier is if they are seriously in debt or can’t even afford basic necessities. I that case, the material things like food, a home,etc. would make the person happier because they would definitely not be as stressed or worried about where their next meal was coming from giving them more time to just enjoy living.
Saying that “money can lead to greater happiness” is, I think, missing the point. The interesting piece of the research is that in this study (good) experiences appeared to provide more lasting happiness than stuff.
This is consistent with my personal experience, and largely consistent with people I know - people who have lives full of rich experiences tend to be happier than people whose lives are lacking in a variety of good experiences. I don’t, however, see much correlation between the amount of stuff or money people have and how happy they are.
So, if you have money, spend it on enriching experiences. If you don’t have much money though, instead of hankering after more stuff or more money, look for more experiences… there are plenty of great life experiences which cost little or nothing!
More money does not mean more happiness. When my husband was making more money, he was more worried about losing it and whether we had enough, etc. Now that less and less seems to be coming in, he’s actually getting less stressed about it. Of course, that could be because the hit we’re taking is on my income.
I could have stayed with my ex and had more money, but that experience was not worth it. I could have made a lot of different choices than I did and had more money. And while I wish I had more money (scrambling to pay your bills each month is not fun), I don’t regret most of my choices.
Thank you all for sharing your thoughts!
R, you make a good point — I imagine this research assumes that one’s basic needs have already been met. The problem is, what we think of as “basic” in industrialized countries is already such a higher standard of living than most other people in the world!
Mark also makes a great point, that great, enriching experiences needn’t cost a dime.
And Anne Louise, thank you for sharing your thoughts. You sound like you have a good head on your shoulders.
-Renée
A small clarification to an oft misquoted passage. “The love of money is a root of all kinds of evil.” (1 Timothy 6:10).I’d be interested to know just who this “countermovement” is.
I must concur with the general sentiment of what “psychology” says - those who seek money itself, thinking that the having will bring satisfaction often find the opposite. Yet those without money are regularly tested in the depths of despair, exacerbated by the demands of their relationships, and delivering negative experiences.
What does the research say about the experience of giving away money to those in need? Must it be used for my own experiences of pleasure to bring happiness? Hedonism is itself a fleeting joy.
I think that to be exact, everything costs money. So to say that “that great, enriching experiences needn’t cost a dime.” isn’t actually true in the most strict sense. Suppose, for example, that you have a profoundly moving experience watching a sunset on a beach with your partner. Unless you walked to the beach, you most likely had to pay for public transportation or drive a car. In either case, it is costing you money, even if that cost seems insignificant or is otherwise hidden.
I would agree that money for its own sake, or used for purchasing goods, does little for one’s happiness. Money used for experiences - to go to school, to learn a language, to travel, to sky dive, to go scuba diving, etc. - can greatly contribute to happiness.
Editorial quibble: San Francisco State University is usually abbreviated “SFSU” (not “SFU”), or just called S.F. State. This is because there are also places called University of California, San Francisco (UCSF, another public institution) and University of San Francisco (USF, a private university run by the Jesuits).
More substantially, I always think of the contrast drawn by Robert A. Heinein in “Stranger in a Strange Land” between people who see money as a tool to work with, and people who see money as something simply to be spent. It doesn’t square exactly with what you’re saying (which I’ve always felt to be true anyway), but it’s interesting nonetheless.
“Money = Happiness” is correct in specific contexts. If you look at the big picture though, isn’t it “unicorns = rainbow happiness forever”?
“People still believe that more money will make them happy, even though 35 years of research has suggested the opposite; obviously most people do not achieve it - therefore the majority still is a believer ! the small minority that actually acquires assets is not statistically meaningful therefore they are not reflected in studies. QED
Great entry!
This is a good add-on to what a series of studies I wrote about back in September that found similar results. That set of studies found that money can lead to a person feeling greater happiness in their lives, if they gave some of their money away:
http://psychcentral.com/blog/archives/2008/09/05/money-happiness/
And it connects nicely to the research I commented on yesterday that found that experiences stick with us in long-term memory long after purchases do:
http://psychcentral.com/blog/archives/2009/02/14/are-you-better-off-buying-flowers-or-dinner/
… suggesting that altruism and experiences make an important difference in our own sense of “happiness” if we can “spread the wealth around.”
There are two kinds of happiness associated with money:
1) the happiness of owning money
2) the happiness of spending money
There are two kinds of misery associated with money
1) the misery of potentially losing what one owns
2) the misery of not having enough money to satisfy one’s wants
Thank you all; we’ve got some great discussion going on here.
I definitely second John’s point that doing kind things for others will make you happy, too!
http://www.medicalnewstoday.com/articles/93947.php mentions research showing that people who tastes the same wine, but labeled with different price tags, were organically happier (as shown by MRI) if the wine was labeled more expensive.
Money as an end will not bring you happiness, for it is a material object in itself, but if you use money as a means to achieve a higher level of well being, it will make you happier overall. Like someone said up there^ money just collecting dust in a bank account will not lead to happiness, but using it as a means to “buy” life expiriences can prove much more valuable in the long run.
I think I would be happier with more money. I would put the extra away to ensure I’d be able to get what I need as I age. I don’t need much, but at those times when I had trouble making ends meet, I felt very, very stressed and unhappy. I don’t feel driven to amass wealth so I can have expensive things. I feel driven to horde resources in preparation for times when they will be scarce.
Hi Renee,
interesting thoughts!
I believe it’s not possible to make a general statement on whether money makes people more or less happy. Money comes with a whole set of new elements that may have good or bad impact on our happiness, and depending on how susceptible we are to every one of them, the conclusion will go one way or the other.
I recently made an effort to provide a more comprehensive picture of what these ad- and disadvantages are. I invite you to have a look at http://www.spreadinghappiness.org/2009/08/money-how-much-should-we-strive-for-it-to-become-happy/ and tell me what you think!
Thank you,
Nick
Hi - just wanted to say I like your design and your blog -
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