Money CAN Buy Happiness?

We’ve all heard that “money can’t buy happiness” ad nauseam. Now a study says it can.

In a social psychology class during undergrad we were taught that in general money does not make one happier, with the exception of wealth providing you with basic needs, and helping to fulfill significant life dreams that are in line with one’s core values.

A recent study claims that money can also buy happiness in the sense that it provides some sense of control in cases of disaster or material loss. If you can’t replace your wrecked car, you may be less happy than the person who can afford a new one. Reading further in the article, it says that what really matters is one’s perception that they have an adequate amount.

Some thoughts:

  1. The wealthy, the big businesses, etc. who are driven to always have more may never be able to rest. They may never feel secure. In fact, that sense of material security is indeed false and ephemeral, according to Buddhist teachings. This is also part of the reason for my disdain for capitalism. A free market may be better than s*cialism, but ultimately it runs on greed, fear, and insecurity. You can argue the “lesser of two evils” idea, but it is still evil, in the sense that it ultimately leads to suffering.
  2. In order to be free from this suffering, and be happier, we should learn to find this security and peace with what we already have. Want more? Great, but don’t seek more for the purpose of being happier. In the best case it will provide some temporary dopamine-laced thrills which will eventually die and a new fix will be needed.
  3. All that being said, I am loving my new iPhone. Hypocrisy abounds!

What do you think? How is your happiness related to your bank account? At what point do you stop and decide that you have enough?

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About shenpa warrior

"Patience is not learned in safety." View all posts by shenpa warrior

20 responses to “Money CAN Buy Happiness?

  • breejones

    Personally, my happiness or lack of worry depends heavily on my financial buffer. I don't like it when I feel like an unexpected hiccup couldn't be absorbed. We haven't really made enough money for me to answer the second questions (when is enough enough?), but I imagine that I'll be like my parents and want to hoard as much money as I can with no real intention for using it. I'll let you know when I get there.

    There's a significant literature in economics about relative wealth and happiness. That you're happy as long as you have more than the guy next to you. It's hard to identify that sort of thing in economics, but people like to talk about it and most people agree that's how people work.

    As far as capitalism goes, socialism could be great but it does lack the innovation thing. Without profit, there's no motive to move forward and come up with new ideas. So while there are a lot of bad things that come with capitalism, I'm happy to have an innovation (or profit, if that's what you prefer to call it)-driven system.

  • pinemountainwalker

    Great post! All we need to do is read our Bibles…

    "A feast is made for laughter,
    and wine makes life merry,
    but money is the answer for everything."
    -Ecc. 10:19

  • salt h2o

    Money doesn't buy happiness, self-reliance buys happiness- most people equate one with the other but it's not necessarily so.

  • adamf

    bree – I was hoping you would comment on this one. πŸ™‚ You and Matt, along with one other econ Ph.D. friend, are pretty much my economic advisors… Re: having more than the guy next to you, that is interesting. I hate to admit it, but I think I work that way sometimes, esp. with clothes. If the guy next to me has some that aren't quite as cool, I feel good. Oh the vanity. Re: innovation/profit – I don't know enough to comment on that, but my faith again is in you econ people! All I can do is help people with their depression due to financial problems…

    pine – That totally belongs in the "Best Verses" post!

    salt – I agree with that, esp. for the topic of financial stability. At the same time, I think we are also all dependent on each other–but perhaps that is a different topic.

  • Anonymous

    Spending money on items leading to experiences is more fulfilling to me with their lingered reminiscence than acquiring a large amount of stuff. I have had no buyer's remorse with an escapade. πŸ˜‰

    q

  • Deanne Hill

    My brother made millions in the mortgage industry… and lost it all when the mortgage industry died. When wealthy, he would say money buys happiness and often said it was never enough. Now that he's lost it all, I think it's given him a new perspective. The rest of the family sure do like him a lot better. He's fun and interesting again and we all spend a lot more time together- happily.

  • derekstaff

    The book Your Money or Your Life, authored by Joe Dominguez and Robin Williams (a different one), includes the interesting concept of the Fulfillment Curve. As you alluded to in your post, the initial amount of money/resources provides very sharply rising fulfillment, as it allows one to meet basic survival needs. As the level of money rises, the curve begins to level out as one begins to reach the level of comforts, and some level of luxuries. Eventually, the curve peaks, and then begins to turn downward. This reflects that at a certain point, the stresses associated with accumulating "things" (where to store it, upkeep, insurance, guilt over neglect, etc) or just the sheer boredom of the experiences (if you eat out every night or go on weekly vacations around the world, it all begins to blur together) outweigh the fulfillment one receives from them.

    I think the concept is largely correct. Wealth/money itself is not bad. We need material resources to survive, and emotionally we "need" some level of comfort and even a few luxuries. The challenge we all face is to determine where the peak of that curve is for us so that we can have enough.

  • derekstaff

    Or I should say, so we can stop when we have enough.

  • Steve

    I think you are right, the curve is key. The problem with capitalism is that it allows people with only a straight line to manipulate and take advantage of others until Deanne's brother loses it all and gets a reality check! Without said reality check, the manipulation continues to grow and the concentration of wealth, whether earned out right by self-reliance as Salty suggests (although typically in our economy and how capitalism works, money makes money and is a Catch-22 when you have none or not enough to risk) or just through making investments (non-productive interest).

    I disagree that capitalism is the ONLY solution for innovation and self-reliance. However, people need to be re-educated on the priorities in life. If everyone or enough at least realized that helping your family, neighbors, neighborhood, and society as a whole is MORE beneficial to both in your short term and long term interest in life AND our jobs and economic system rewarded it, then people would actually be what most consider a more Christian society without the need to accumulate wealth, yet continue to be innovative, grow, and be a strong, cohesive group that meets all of its needs. A VERY clear example of this in a non-traditional way is the porn industry. B/c of the way they have bonded together through the last 50 years and worked to grow and strengthen their ability to meet their needs and admittingly make Billions of dollars, it created the VCR, pay per view tv, the ability to purchase things online, webcamera and streaming video online, and DVD technologies. All of these things may have come along eventually, but the porn industry found innovation and a common bond to protect each other and got all of these technologies in the mainstream. Now, with that all being said, now with the push for profits, the industy is seeing its biggest contraction ever! Two-thirds of porn businesses have gone out of business in the past couple of years and aside from the economic downturn, it has been b/c so many got into the business with a clear capitalist business model. The ones that have survived are the older businesses that follow a more socialist (free healthcare, labor friendly contracts, collaboration, etc.) and bell curve business model.

    It might seem silly/heathenist to use the porn industry as a business model, but it has been and continues to be one of the most successful and innovative industries in the past 30 years and is a perfect barometer for our economy as a whole.

  • adamf

    Interesting… so my question is, how do we seek to provide for our families, have a few luxuries without going over the curve, and not get caught up in hording away money or collecting more and bigger possessions? How do we promote that ideal to those around us?

  • Salt H2O

    "However, people need to be re-educated on the priorities in life."

    That line really scares me.

  • adamf

    Salty – it scares you because it is true, or does it scare you because of the possible means by which people would be re-educated?

  • derekstaff

    I'm a bit surprised that someone within the Church would be frightened by the word "reeducate." Isn't that what the Gospel tells us? That we need to be "reeducated" as to what is really important in life? That we need to learn that casual sex, superficial appearances, instant gratification–and yes, wealth accumulation–are not the source of real happiness?

    As to your questions, Adam, the answer to the former is the same as all parts of life: constant self-reflection, introspection, and self-evaluation. The answer to the latter is to vocally reject the conventional economic wisdom of capitalism: to speak out against self-interest and promote instead interdependence and social responsibility. It won't magically make everything better, but I think it will help curb the excesses rationalized and enabled by the theories which promote self-interest, profit maximization, and enndless "growth."

  • adamf

    Speaking out against self-interest? That smacks of socialism! πŸ˜‰

    What frightens me is the view that the growth of one's bank account is somehow equated with their righteousness or growth as a person. Hugh Nibley said that it's the pursuit of gain, or more money that is the "root of all evil." Money is not the problem, it's the pursuit of more of it. Which, it seems to me, is the heart of the free market.

  • derekstaff

    Adam, some might argue that there is a difference between a true free-market philosophy (where the guiding principle is self-determination) and the capitalist system (in which self-interest is the central concept). However, the distinction between the two becomes very blurry in practice, so I wouldn't quibble much with your last statement.

    And yes, capitalist theory shares quite a bit with Calvinism, where your prosperity is evidence of your character, where in reality it is as often evidence of how ruthless you can be.

    On the subject of relative inequality, which I somehow missed on my first glance through the comments, you might be interested in the book I recently finished Falling Behind, by Robert Frank. A concise examination of the concept of relative inequality and how it hurts society.

  • adamf

    Interesting–I have a lot to learn. Thanks for the book recommendation.

    Re: Calvinism-that's an interesting comparison–esp. because of my general disdain for their God and his luciferish qualities.

  • derekstaff

    Recognizing your ignorance is the key to learning, Grasshopper.
    πŸ˜‰

  • Steve

    Derek – Thanks for the book recommendation. That is totally going on my Wish List.

  • NIck

    Hi adamf,

    interesting thoughts!

    I believe that 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.e. different from person to person).

    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

  • AdamF

    Thanks for the comment Nick, and you make a good point. It may vary from person to person. I think we also have to look at how money interacts with one’s other core values.

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