Can Money Buy You Happiness?

moneytalks2Photo courtesy of Daniel O’Neil

“There are people who have money and people who are rich.”  ~Coco Chanel

It’s a concept that’s been debated for longer than any of us can probably remember: Can money buy you happiness?

Minimalist living has increased in popularity as of late, with its proponents loudly proclaiming that they are happier than ever – that apparently money, and everything that comes along with it, was actually preventing them from living their best lives.

Meanwhile, the “rest of us” continue to daydream about an endless supply of cash that would afford us the ability to stop worrying about our next paycheck and start living it up.

So, which is more desirable – more money or less things?

Researchers at Harvard Business School have been keenly interested in exactly this question – so interested, in fact, that a book on the topic, “Happy Money: The Science of Smarter Spending” has materialized.

According to one of the book’s authors, Harvard Business professor Michael Norton, most people rank experiences, rather than material items, higher on their list of purchases that have given them the most happiness.

In other words, taking an amazing trip with people you love will continue to give you the warm fuzzies a lot longer than that golden toilet you had installed last week. After awhile, the “newness” of the shiny commode will wear off, and it will become just another place to do your best thinking. And what you end up thinking about won’t be the fact that you’re sitting on a golden toilet seat, but the details surrounding the vacation to the Caribbean you took last year. Man, was that fun.

Another example cited by Norton is the thrill of buying a luxury vehicle. While it may seem that driving a brand new, fully loaded luxury car would definitely heighten your enjoyment of a daily commute, in a few weeks the newness will wear off. What you’ll be left with is what you had before: a commute to work. Oh, and when it snows, you’ll still have to dig your luxurious vehicle out, which might even make you vaguely miserable.

Perhaps you’d be better off buying an economy car and hiring someone to shovel you out after each snow storm. The experience of not having to shovel anymore will make you happier much longer than the initial thrill of owning a cool car can last.

In our world, it’s inevitable: money talks. To someone earning $20,000 a year, an extra ten grand has the potential to increase their satisfaction with life – but only if they spend the extra money on making their lives more enjoyable in the long run.

Is Donald Trump happier than you? Not necessarily. I know several pretty wealthy people and they definitely don’t seem to be all that blissed out on life. On the other hand, they probably aren’t sitting around chewing their nails to the quick, worrying about whether or not they can make rent this month.

So, to answer the original question: Can money buy you happiness? The answer is sometimes, but most importantly – only if you spend it right.

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