What Makes Us Happy?
If I were to ask you what makes you happy, you would probably have no problem providing me with at least a few answers — a new car, less body fat, a higher-paying job, a lottery win, a better 3k time, and so on. Answers to this question usually have a similar theme; i.e., our happiness depends on external circumstances (Lilienfeld et al., 2010).
You may be surprised to learn that materialistic things rarely determine long-term happiness. That which you have always assumed would make your life much more joyful may not actually improve long-term happiness. Happiness is determined by innate factors and perceptions, as well as experiences.
Albert Ellis claimed it was irrational to suggest that happiness was caused by external circumstances. According to Ellis, happiness depends on our interpretations of events.
British philosophers John Locke and Jeremy Bentham claimed that happiness is determined by the number of positive events experienced in life (Lilinefeld et al., 2010, & Eysenck, 1990). On the other hand, Eysenck says the No. 1 myth regarding happiness is that happiness is determined by the number and nature of pleasurable events experienced.
A study conducted by Kahneman and colleagues (2004) tracked the moods of 909 employed women. Their moods and activities were tracked by asking them to record the previous day’s activities and experiences. The researches concluded that most major life circumstances (household income, jobs benefits) correlated minimally with moment-by-moment happiness. What did correlate strongly with happiness was sleep quality and proneness toward depression.
Money and Happiness
In order to be happy we need enough money to pay our bills and have a little room to purchase extras. There appears to be an income threshold where making more than this amount contributes very little to being happier.
Having a household income below $50,000 is moderately related to happiness. A household income above $50,000 results in a vanishing correlation between money and happiness. There is some data indicating that the income threshold may be a little higher or a little lower than $50,000.
Americans who earn $50,000 per year are much happier than those who earn $10,000 per year, but Americans who earn $5 million per year are not much happier than those who earn $100,000 per year. People who live in poor nations are much less happy than people who live in moderately wealthy nations, but people who live in moderately wealthy nations are not much less happy than people who live in extremely wealthy nations (Gilbert, 2007, p. 239).