February 18, 2009

Can Money Buy Happiness?

A new study says: yes, sometimes money can buy happiness, depending on how you spend it.

The topic seems quite timely, because what with the economy in such dire straits, many of us are worried about what we're spending our money on. We naturally want to get the most bang for our buck.

So let's say someone handed you a few thousand dollars you weren't expecting. (Hooray!) According to this latest study, what do you think the wisest investment of this money would be for your personal happiness?

a. Get your car fixed so that you're not driving around on bald tires with an engine that stalls out at unpredictable moments, thus increasing the chances you'll make it to work alive every morning;

b. Replace the upstairs toilet with one that doesn't spontaneously flush every half an hour, and finally do something about that black mold some annoying plumber told you was probably "toxic";

c. Buy yourself a Rolex;

d. Take some friends on a trip to an exotic island to go snorkeling.

Clearly you'll be much happier if you...

(d) Take everyone snorkeling, of course!

This is why I tend to hate "happiness" studies.

True, the study didn't actually ask this exact question. But it does irritate me that researchers aren't very good at measuring the peaceful, stable, boring kinds of happiness--like the kind you get knowing that the bills are paid and there is food in the refrigerator.

Anyway, in this study, researchers found that "experiential" purchases such as "a meal out or theater tickets," led to "increased well-being because they satisfy higher order needs." They concluded that "buying life experiences rather than material possessions leads to greater happiness."

I actually agree that this is mostly true. (More on that in a moment). And other research has said experiences beat possessions too. But I still have to gripe about the study because griping makes me happy! Take that, happiness researchers.

Anyway, participants were asked "to write reflections and answer questions" about what they'd bought recently. Since "participants indicated that experiential purchases represented money better spent and greater happiness" the researchers concluded this must be true.

I'm sorry nice researchers, but I think the methodology of the study screws with the results. Would you be willing to rhapsodize in a little essay about your new iPod, not to mention that nifty low-flow toilet, the same way you might a trip to the symphony? You're going to sound much cooler (and have more to say) about a recent "experience" than a "thing." Does it really mean you will get more happiness out of the fleeting experience than the "thing" in the long run? (Although personally, I could write a 5,000 word essay on why I still love the garlic press I got for a Christmas present five years ago, but then I'm a little odd).

In Defense of Possessions:
Here's my main objection to the research: I think "possessions" vs "experiences" is a false dichotomy. Because something like a bicycle, or a great book, or a new plant to put in the garden, or a bowling ball may technically be an object, but it also can create or transform an experience and provide a lot of happiness.

I think the real debate should be about things we buy for status, versus things we buy for our own comfort or pleasure or adventure. An "experiential" dinner eaten at a Trendy Restaurant is, in my mind, a lousy bargain if you only went because it seemed like a sophisticated thing to do. But a great book or a new kitchen gadget or a comfy pair of running shoes can be a great happiness bargain, if using them gives you pleasure.

The relationship of money to happiness is a fascinating topic, isn't it? Because we all have opinions about money, and about happiness. And we're all pretty sure we're spending our money the right way, on the best things.

Of course the research pretty consistently says that we're clueless. Money doesn't buy us nearly the happiness we think it will; and we tend to spend it on dumb things.

It does help to get your basic needs met. But according to an interesting article on money and happiness from a couple of years ago, "going from earning less than $20,000 a year to making more than $50,000 makes you twice as likely to be happy, yet the payoff for then surpassing $90,000 is slight."

Do you ever marvel at people who spend a fortune on luxury automobiles and vastly oversized homes, then find themselves working insane hours at jobs they hate in order to pay for them? (Sometimes there's even a perverse kind of happiness in noting how silly other people are about their choices).

All kinds of things make me happy; some of them (like massages, good restaurants, or travel to foreign countries) are expensive. But while it may be a bit of a cliche that "the best things in life are free," sometimes it's true. Or at least they're pretty cheap. Other favorites: a cup of good coffee in the morning; a peaceful stroll along a beach or through the woods; music so beautiful it makes you sigh; a laughter-filled evening with best friends; or a blissful weekday evening hunkered down with a beloved spouse, a pizza, a purring cat and a favorite tv show.

So do you folks think money can buy happiness? What do you think are good happiness "bargains?" Any examples you've seen of really lame ways to try to buy happiness?


  1. Wow that was pretty insightful :)

    As far as happiness I've bought with money...We actually do tend to spend my money on traveling. I'm not sure if it's the traveling that makes me happier or if it's the fact that I'm not at work. If it's the latter, then it's not really buying me happiness very effectively because I could get that for free if I just quit. Hmmm, what a conundrum.

  2. If I had a spare few thousand I'd put some away and make a point of spending some of it unwisely.
    Lame ways to buy happiness include, but are not restricted to, buying everything that's advertised because it will give you the perfect life.
    Money does not buy happiness, but it does make misery more tolerable.

  3. Oh man, what an annoying study. I agree that the methodology messes with the results. They're asking participants to write reflections on what they'd bought recently?(!) Ok. So someone who's reflecting on a trip they just took to Aruba *probably* already has their car in working order and a non-toxic bathroom. Probably. And I'd venture to guess that because of that level of security, they're happier all around than someone who doesn't. I'd bet too that if the person with the basic needs going unmet took that same trip, they wouldn't get as much happiness out of it because their general levels of stress would be higher overall. It's as though all they've established is that if you're fairly happy coming into the study, then the study will note how happy you are while you do things. grrr.

    Ok. endrant. to answer at least one of your questions, I agree with the idea that getting out of poverty gives you a much better chance of being happy. If you're not under the weight of poverty, then you've got some freedom, some choices, some room to move and think and act. I happen to think that at that point, creative internal shifts can do alot more for us than anything we can buy. What we think, how we feel, what we do as part of our regular existence seems like a much more powerful force than isolated purchases, whether they're material or experiential. I'd make an exception for the argument you gave, with examples like a bike, where you potentially get a long span of time full of happy experiences.

    Happiness bargain: exercise.

    I found you through sheesh, btw. Merry's a gem - it's great to see her writing here with you.

  4. I think it's funny when a rich old wrinkly man tries to buy happiness with a young barbie type with implants. Clearly she's been bought. But hey, whateva' makes ya happy!

  5. Interesting post, Crabby. And your point about their basic methodology skewing their results was spot on. Money clearly is essential for basic happiness - if one has absolutely no money, and is living in their car, or under a bridge, a found 10 dollar bill could buy them a little happiness... in the form of a meal.

    But for those of us who have our basic needs met, and have a roof over our heads and food, etc., then a little extra money could possibly buy some happiness.
    In the form of a meal.

    Okay, methinks I must be hungry - off to find me some happiness in some granola.

  6. I don't believe that money buys happiness, but money gives you the freedom to find it!

    You need to have the fundamentals taken care of before you can think about spending money on doing things or material possessions. If you get kicked out of your appartment and are homeless, I doubt a vacation will be a permanent fix. It will be like putting a bandade on a shark bite - it'll help a little, momentarily, but really you need to fix the bigger issues before worrying about the cherries on the top!

    That being said, we (the hubby and I) dream of winning the lotto all the time. First, I'd pay off my debt. Get good cars, help out our families (pay off the parent's houses, etc.), get a house of our own, etc. But, really, I'd love the chance to travel. Or go to the movies when we want, or to go out to eat, see concerts, etc. It's the experiences and extra time with my husband that I really want!

  7. Wow Crabby,

    You've really been out-doing yourself with your posts lately.

    Excellent point, that material objects often have experiences attached. This is true of my Trail-Runners, my Yak-Trax, books, music, and many other "things".

    Also, my husband is an artist (he mostly does oil paintings), and art illustrates that point like nothing else. Good art is alive. It speaks to you different ways on different days. It becomes part of your life.

    Also liked the point you brought up about the diminishing returns of "more" money. We (as Americans) seem to have a big stumbling block--the idea of ENOUGH!

    I settled this quite some time ago for myself. The most valuable thing about money to me, is that it can buy me more FREEDOM. Therefore, if I become less free in the pursuit of money, it is time to put on the brakes. (Of course, I'm not talking about meeting basic needs like food, shelter, etc. If from time-to-time I have to suck it up and work harder just to make ends meet, which has happened, I try to just ride it out.)

    Thanks for another great post!

  8. I have to say that a great happiness bargain is our yearly camping trip! For a vacation, it's super cheap.. but you can't put a price on sitting around a campfire on a chilly night with your spouse, loveable dogs, and some close family! Granted, I'd love to take another cruise (our honeymoon,) but we come home from camping just as relaxed. :) Won't be cruising again for quite some time.. the money is better used to fix up the house so we can sell it and move to a better school district (and not be able to read a book over our neighbor's shoulder because we live so close!)

    the camping trip last summer was cancelled due to my sister and I both being very pregnant. Wonder how it'll go this year with three babies...

  9. This dichotomy reminds me of my one college psych course, when the professor was talking about how everything could be divided between things and ideas (tangent: are ideas experiences???) and I asked "But what about books? They're things, but they contain ideas," and he beamed at me.

    I can only say that an object that isn't an experience means that you're Not Paying Attention. Let me rave about my low flow toilet: I loved the one I bought to replace the one with the cracked tank five years ago so much, that I got the exact same model for both bathrooms in the new house. : )

    Mary Anne in Kentucky

  10. I'm trying to find a link to study I read about money and happiness, but I can't find it. The gist of the story was that people were asked how much money would be necessary for them to feel that their lives had irrevocbly changed for the better. The result was surprisingly low, somewhere in the region of £57,000, or two years salary.

  11. Another thing that makes me happy: reading a bunch of really insightful comments from thoughtful folks about happiness!

    You guys are so much smarter about how they pursue happiness than most of the folks I see "out there" trying to buy status objects to make themselves happy. Time, adventure, joy, peace, security, travel, art, camping... and even low flow toilets!

  12. Money can't make you happy, but lack of it sure can make you unhappy! I agree with what natalie said. Flawed study, they need a redo! Buying "things" can rank pritty high on my "makes me happy" list, but only if it's stuff that makes my life easier or more fun. For example buying a new faster computer makes my life easier and allows me to do more with my computer. Most of what I spend my money on is experiential though, dinners out, my gym membership (vital), drinks with friends...you know that kind of thing.

  13. These kinds of "happiness" studies are all fundamentally flawed to begin with... How does one measure emotion first of all, second how can you possibly know the depth of someone else's emotion? And is it even feasable to think one person can exactly and correctly explain what they are "feeling" and to what level as compared to someone else???

    What makes me happy clearly doesnt make others happy. Even at my happiest, am I as "happy" as my niece whos mindlessly laughing at bubbles and cartoons??? How can you compare???

    My mom gave me words of wisdom when I was a morose teen that work for me to this day.....

    "Only stupid people are truly happy because they dont know any better".

    I prefer contentment. :)

  14. I remember one study that suggested the happiest people out there were the ones who made sliiiightly more money than the people around them. You don't need to be rich, you just need to feel you're doing better than everyone else, apparently.
    Could all be tosh, of course.
    I agree, some good comments here! (And some that make me blush.)

  15. I'd buy an acre or two of land, pitch a tent for Hubby and me, and one for Tween, buy some chickens and plant our fruit trees and lots of veggies. Oh, and if we have any left over, get someone to build us an outhouse!

    A year ago I would have helped someone else. Now, I'm so concerned about our own finances, have to go the selfish route. My family needs me.

    Vee at www.veegettinghealthy.blogspot.com

  16. I would like the opportunity to find out if lots of money would make me happy. These studies clearly need a lot more rigorous testing ;)

  17. I'm glad I wasn't the only one befuddled by the study. You cannot wholly distinguish experience from objects/possessions. After all, we often experience things with those objects.

    That said, I will say I did two things last year that involved spending about the same amount of money: Buying a flatscreen HDTV and going on a 5 day New England vacation (with much help from the Priceline gods). I enjoyed the vacation more even though I don't have much to show for it.

  18. I'm a bit conflicted about it, but I think that 1. the way the study was conducted is flawed, and 2. that it's a little of both.

  19. As many others have said, I think it depends on your circumstances. Having been through the experience of working crappy part-time jobs, worrying about having money to pay bills, buy groceries, keep my car on the road (which was necessary to get me to the crappy part-time jobs), I can say that working full time and knowing that I can pay my bills makes me happy.

    Now, in my current situation, if you were to say to me: Would you like this amount of cash to spend on a fabulous vacation? I'd say: Sure! I like traveling, I like vacations, that would absolutely make me happy.

    If you were to offer me the same amount of money, no suggestion of trips, to be spent as I pleased, it would most likely get spent on "things." Probably things around the house and/or yard. We live in our house every day, and I can honestly say that money we've spent to fix up the house/yard has made us happy. Because having a comfortable home to live in makes me happy.

  20. I agree with you about their methodology and how it would affect their results.

    I work in a situation where I am in contact with a lot of disgustingly wealthy people and it's true that they have the same problems that everyone else does (marital discord, problem children etc.) but they rarely have the financial worries that we all do. So in one sense they are happier, plus if they have a crappy day they can reward themselves with a wine tasting trip to Napa or a luxury spa treatment, so they've got that going for them too.

  21. Clearly the people conducting the study have understimated the happiness of having things like WORKING TOILETS. LOL.

    I agree with the idea that what purchases make you happiest have a lot to do with your income. I also think that AMOUNT of "extra" money matters. When I was just out of college and broke beyond belief, my parents gave me $200. I was ECSTATIC. What did I use it on? Paying off debt. And I was thrilled to be able to do it.

    On the other hand, if I suddenly got $200 NOW? I'd probably buy a nice handbag. That I could carry every day. That would make me happy every time I looked at it. (That's sort of experiential, right?) Honestly, I can't bring myself to drop $200 on dinner. That just seems like a waste of money to me. (Mostly because I can cook just about anything I can order, for a lot less than the restaurant cost!)

    On the other hand, a spare thousand? Screw the handbag, I'd probably sock it away, add to it, and then go to Europe. So WHAT would make me happy would also depend on HOW MUCH I got. Does that make sense? Paying off debt, a new handbag and a trip to Europe could all make me equally happy.

    For me, I guess the big thing is that whatever makes me happy is what I can have WITHOUT hurting myself financially. How about that?

  22. I hear you on the garlic press. I heart my George Foreman grill.

    Me and my family have a thing where we only buy each other consumable gifts... travel-related or food for nourishment or supplies we need to use every day (shampoo etc). Or art that's pretty to look at. And books. Anyways, the point is, that we're buying things to enhance the happiness we've already got... rather than little mundane extras that just get in the way and don't contribute to a happier lifestyle.

  23. I am in the toilet business and there are some very nice, happiness-inducing toilets that cost upwards of 5k. If you have 5k to spend a toilet that knows who you are when you approach it, that is guaranteed happiness.
    Sort of like a hooker. Which is my example of really lame happiness-inducing expenditures. Also chocolate could be considered lame.
    Is them fightin werds? Word!
    See the happiness toilet here:

  24. first I have to say.........unless you have come to that point in your life that you are truly happy within......no amount of mula can get that true joy for you.


    I do believe that money can take a heck of a lot of stress off of you......and when you are less stressed it usually leads to more freedom and a better chance of having peace in your soul, mind and body to get to that place of happiness!

    That said........I am finally happy within but a million dollars would only add to it :) and I would spread it around!

  25. nice argument... we all know that money can buy happiness to some degree..but that happiness cannot persist for long time...

    Ways Of Obtaining Real Inner Joy

  26. Great post! You really gave me a lot to think about it. Off the top of my head I would have answered that of course I would choose experiences over things but you said it all with "I think the real debate should be about things we buy for status, versus things we buy for our own comfort or pleasure or adventure." So true!! As for money buying happiness. No, I don't think it can. But money can buy survival and you can't be happy if you aren't surviving. Once you're past survival level then the question becomes whether or not money helps you thrive. After working in an all girl's private school (read: a hundred filthy rich princesses) I'm not sure that it does.

  27. Hmmmm...darn you, you made me actually think! My happiest moments I believe have to do with experience, though some of those really didn't cost a lot of money.
    I really think this can't be quantified - it's not a one size fits all type of thing.
    I would, however, love to see if lots of money would make me happier....

  28. Nodding along with your entire post.

    Not that I don't enjoy adventure, but a baseline of security is what makes me happy: living in a safe area, having secure relationships, and financially having things like savings. Then I can go out and get the "highs" of snorkeling trips and the like, but not without that foundation.

  29. When I don't have to worry very much about paying the bills, I am a LOT happier than when I do. But there are definitely diminishing returns to money... it buys only so much, and then you have to figure out what happy really IS for you.

    But it sure does buy time, and that's the ultimate scarce resource. I have to say that the single "purchase" that has increased my happiness most lately is someone spending 3 hours a week doing basic cleaning in my house. I don't spend all my time being miserable because (1) the house is not clean, and (2) I am too busy to fix it. Money unbelievably well-spent, even though it makes me feel guilty and slightly incompetent.

  30. I agree, money cannot buy happiness, but it feels a lot better to sit and cry in your Jaguar rather than a broken down Honda!

  31. Like lots of people having enough money to survive in the manner I've been accustomed to makes me happy. I'm lucky cos both of us have public sector jobs that are unlikely to go anywhere in the near future despite the economy.

    However this Christmas I found myself feeling slightly ungrateful for physical objects that I was gifted. This feeling also made me feel guilty. Some gifts were lovely but I didn't love them or need them and they are now just clutter. They weren't making me happy so I've started sending them to charity. (Maybe it's my age but I feel I've grown out of the quantitiy over quality childhood obsession now.)

    Also our hobby is geocaching which once you've bought the kit just needs the internet and petrol to get us to the starting point and then the rest is free. We get stunning walks, views and we usually learn something new we didn't know before. Unless I'm being chased by cows and dogs this makes me exceedingly happy.

  32. I have a saying that I tell people...

    anybody that says money can't buy happiness never had any

  33. One definitely needs at least enough money to meet basic expenses, otherwise those sublime experiences don't do much for one's overall happiness quotient.

    Where I think a lot of Americans go wrong is in overestimating what their basic needs really are. If commuting by bus takes 3x as long each way as commuting by car, then buying a car will likely increase one's happiness by freeing up more personal time. That car can just as easily be a used Camry as a new BMW, though. The temporary thrill of the more expensive car will fade and the monthly payment may actually decrease happiness by adding more stress and decreasing surplus money which could've been spent instead on a fun vacation.

    So it's all interconnected, things vs experiences. For me, if my simple needs are met, I'm all about experience over stuff.

  34. I'm going to ponder this one a bit. Sometimes, when I really need a thing, buying it makes me feel very content; other times, I prefer experiences. I have to be choosy about objects, though, since we live in a really small house.

    One source of bargain happiness for me: the library! Our library system has an online catalog, and I can request that an item be sent to the branch of my choice for only 75 cents. Love it!

  35. I would think that it depends on ones method of receiving the money. Has the individual had real life experiences and challenges that have molded their foundation? Was the individual born with a silver spoon and can only see what is in their circle? I can think of two examples of VERY wealthy individuals that have symptoms of being pretty miserable. On the other hand I can think of some examples of individuals that seem to be fairly happy. In a nutshell, I think circumstances and the individual ultimately decide if money CAN buy happiness.

    Diana makes a solid point "I don't believe that money buys happiness, but money gives you the freedom to find it! "

  36. We consistently pursue "stuff" in the hopes that it will make us happy. In the process, we lose sight of the fact that it is our time that makes us happy. Treasure your time with friends and family. It's far too fleeting.

  37. I've been thinking about this post all day! Love the comments as usual. I started highlighting all the things I agreed in other comments but stopped - there were way too many.

    Having enough money to survive certainly affects happiness.

    Beyond that, I see it simply: If I never compare myself to any one else I usually fell that I have enough. My angst for "more" experiences or things typically (but not always) comes from the comparison. If I have a decent pair of running shoes and a couple of pairs of sweats I can reap all of the benefits of a good run. A solid run in the sunshine, preferably in the mountains, brings me a lot of happiness (well, it used to. I'll get back there in a couple of months, lol). But once I notice Suzy down the block and her fancy new shoes and cute new capris and new iPod, I can choose whether or not to give that simple joy away to the comparison (waaaa. I want a new iPod!) or keep it to myself and enjoy what I have. I think people compare too much.

    That said, I've been in circumstances where I couldn't afford the shoes (or gym pass last year) and not having that "base" to be able to do something I love-well, it was just crappy. (so does that count as Things or an Experience?)

    Anyway, loved the post, definitely got me thinking.

    (One more thing- I'm an emergency preparedness freak and so if I had a couple of extra thousand dollars I'd be inclined to buy 72-hour kits for my family, some more wheat, flashlights, a super fancy first aid kit. YES OK. I'm a nerd. I know.
    Talk about "boring" happiness but all of those things are "things" and they really do bring me a degree of peace and security which decreases my stress (hence adding to my happiness).

  38. I agree with the basic idea from all the comments here - and they're better articulated than I could have done so I'll leave it at that!

  39. LOVE this post!

    Um, hubsy and I tend to spend money on travel which is what we LOVELOVELOVE.

    I do love me a nice handbag, but its mostly only goes as far as window shopping for me (it always comes down to, well, I could go to italy for that much money...and who can resist italy?)

    Have a great day!

  40. Why even do studies like this? Flawed methodology?! The whole thing is bogus.
    WE know what makes us happy. WE don't need "no stinkin studies" to tell us!

  41. Wow this post couldn't have come at a more perfect time! I have a sister in law who is CONSTANTLY trying to 'one-up' me by telling me about all the crap she buys. 10 new shirts for herself, some clothes for her baby, 'designer jeans', decorations, furniture, fancy food, tv's, you name it. And that's all in the past 3 days! Seriously. She's bought all of those things the in the last 3 days and told me all about it. I know she is unhappy in her marriage and it's so frustrating to me that she feels like as long as she is spending money, and a lot of it, AND trying so hard to rub it in my face, then she will seem happy. I do think that spending money on experiences- cruises, vacations, trips to the zoo, etc.- make me a LOT happier than having the latest plasma TV or BMW, or touch Ipod. But that's just my opinion.

  42. seems to be some madness to the methodology methinks

    Tho i'd sock some away and spend some on some horsey tack...

    happy trails

  43. I listened to that program, and thought the same as you - a thing can make you happy over time but isn't exciting on paper (like a computer hard drive or a plate with a pretty pattern).

    I was surprised recently when my sister posted that one of her all-time favorite gifts was tickets to a play. She's gotten a lot of nice things in her life, but going to the play with family was top 2.

    Safe to say there'll be more of that type gift in the future.

  44. I am obviously warped, because I SO can rhapsodize over assorted possessions! Quite a few of them. You don't really want to get me going, do you?

    Take my iRobot Dirt Dog. I LOVE this little sweeper. Since he came into my life, my bedroom floors are free of cat hair and cat litter. I can walk barefoot in the bedroom again! And he takes care of the living room too! I do not have to slave vacuuming daily... nor do I have to watch my floors get dirtier and dirtier if I don't.

    Then there's my Vita-Mix. Use it daily, it saves me by making me good healthy food and fast. Or the rice cooker... that cooks healthy steel cut oatmeal for me and has it piping hot and ready when I return from the gym.

    I love my stuff! I also like spending occasionally on art, something I enjoy seeing every day.

    I do like experiential things too, but traveling means knowing that the fur children are unhappy being boarded. Talk about guilt when you get back and they are howling their heads off when you pick them up!

    Memories are nice... but clean floors and perfect oatmeal when you want it are priceless, LOL!

    That said, hubby has scored tickets to an upcoming K.D. Lang concert and I am so looking forward to that! 4th row seats!

    We live simply, but indulge occasionally and life is good.


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