Time and time again we have heard that money can’t buy happiness. But is that actually true? I don’t know about you but when I go out and buy something expensive, I certainly am happy. Who’s to tell me any differently?
Luckily there have been several studies conducted about this very question. Do you know what the majority of the studies have found?
Money CAN buy happiness!
It’s true, the amount of money you make directly corresponds to your amount of happiness! Finally, the debate has been settled by a study conducted and published in the Nature Human Behaviour Journal.
However, don’t be fooled. It does not correlate exactly how you may think.
Studies show there is an optimal amount of money that a person in the United States needs to make in order to maximize their happiness. The more money you make, the happier you will be – up to a certain amount.
Originally when I found this out, I figured the magic number would be somewhere around $200,000 or $300,000 a year. I could definitely buy enough stuff to keep me happy with that kind of salary.
After researching further, I found that the magic number is much more achievable than that. The amount of money you need to make each year in order to optimize your happiness?
The study from Nature Human Behaviour Journal found that from $20,000 to $50,000 a year, you are twice as likely to be satisfied and content with life but that happiness increase starts to plateau around $75K.
So you’re telling me if I made $200,000 a year, I wouldn’t be that much more happy than if I made $75,000 a year?
Yes, yes I am.
The reason for the dramatic increase in happiness from $20K to $50K is due to basic human needs being met at $50K (i.e. clothing, food, shelter). After the $50K mark, you start to fill your life with more “toys” which equate to “wants” rather than needs.
I know I may not be making a believer out of some of you because on the surface, I also feel I would be much happier if I made $200K a year. However, to further illustrate the point, right now in your life, are you truly happy and satisfied?
Are you beaming with happiness every day and fully content with every aspect of your life? If so, I congratulate you – because you are a unicorn. The unfortunate reality is, Americans are the #1 consumer of antidepressants in the world yet we are some of the most wealthy individuals on the planet.
Now just because you don’t make $75,000 a year doesn’t mean you can’t be happy. In fact, some of the happiest people on the planet make much less than that a year. The study focused on wealthy countries and income earners. The study found that if we are strictly looking at emotional wellbeing in direct relation to money, happiness only increases to a certain point.
Human beings are very adaptive in nature which is a primary cause for our overall discontentment. Remember when you switched from a flip phone to a smartphone? Those Blackberries were out of this world! I remember using the side-scroller and texting on a keypad and feeling like I had reached the pinnacle of my cell phone days.
That is until Apple produced the iPhone.
The iPhone and others blew Blackberries out of the water. The same can be said for how “cool” pagers were in high school. That was the thing to have and you were nobody if you didn’t have one.
Fast forward just a couple of years and you know how the pager story played out. Each year we get bigger and better, then smaller and better, and then bigger and better again.
The more money you make, the more toys you can and will buy. That flat screen keeps getting bigger because your old 50″ screen looks so small compared to the new 80″ ones. Sure, you can go on big expensive vacations more often, but remember when going to the beach in California as a kid was the best thing ever?
Now you have to go to Europe to get that same high.
The truth is, we will never have enough money if we don’t focus on being content with what we have. Our newest purchases rarely satisfy us for long so let’s slow down and be thankful for what we have. For goodness sake, much of the world doesn’t even have clean water to drink yet we have it plumbed straight into our homes!
Businesses and marketers take full advantage of our discontentment. There are monthly subscription services where a company will send you new clothes automatically each and every month. Every month!
They are betting you are bored with your clothes from a month ago and will be enticed, yet again, to buy something new. This is a multi-million dollar industry! With the whole world looking to capitalize on our discontentment, how will we ever find happiness and become debt free?
As stated before, to become debt free and to start building wealth, we need a complete change in our mindset. I will tell you that being debt free certainly increases your happiness, but from there – stop looking at what the neighbors have and build the life that suits you so you can help others.
One of the things I ask myself before I make a large purchase is, “will this item add value to my life?” If it doesn’t and it’s just something to keep me entertained for a while, I don’t make the purchase. Perhaps most of us need to examine what we truly value in life before we move forward.
If you have trouble with buying material things, I would encourage you to shift that money towards experiences rather than things.
Experiences have an amazing way of making us happy and keeping us happy for a longer period of time. The reason for this is the memories that are created and the positive feel good points that are embedded in your brain.
For instance, I still remember the trips to Disneyland my parents took me on when I was a kid. I distinctly remember going on certain rides and watching certain shows. I can tell you where I was standing and what show I saw even though it occurred more than 30 years ago.
I have so many memories of fun experiences in my mind that I can relive whenever I want. However, when it comes to buying “things” I quickly lose interest and that feeling of contentment.
I have always loved music. Because of this, I took lessons to learn how to play the trumpet and learned how to read music. I was part of several choirs when I was younger and have great memories from the relationships I built from those times. I still know how to play the trumpet and that is something that I will always know how to do.
Spending money on learning a new skill or talent can be a great way to improve your happiness and give you a goal in life. Create ways to keep yourself motivated rather than focusing on a new purchase that will be here today and forgotten about in a month.
Have you experienced giving to someone in need? It is an amazing feeling and helps you get more in touch with humanity. A friend of mine told me that before the holidays, he saves up his money. When the holiday season comes around, he looks for people that look like they are in need and gives them a hundred dollar bill.
He told me about a story where he was in the dollar store and he could tell a couple was buying Christmas presents for their kids. Their clothes were dirty and they were pushing a stroller but they were still trying to give their kids a great Christmas. Right then and there he walked up to the father and gave him a hundred dollar bill.
My friend said this was one of the most rewarding experiences of his life. The man broke down and he could tell this genuinely affected the family in a positive manner.
How awesome is that? Think of different ways to make this world a better place – and your level of happiness will improve.
This life is about living and giving – the more you give, the happier you will be. If you die with the most toys, you didn’t win. It’s about how much good you can do in this world. By eliminating your debt and building your future in both wealth and health, you will be able to help even more people as you traverse through this life. You can do it my friends and I will be here with you!
This post originally appeared on Arrest Your Debt.