Lesson: Money changes everything -
Strategy 8 highlighted the small contribution of external life conditions to happiness, and Strategy 9 showed that changes to these conditions only make a short-term difference – we adapt and our happiness levels are soon restored.
Since for most of us money is one of the most important life conditions – and one often expected to produce happiness – money is the subject of this strategy.
The research on money and happiness may not be what you expect:
- Personal incomes in the US have doubled over the past half-century, yet people are no happier (1)
- Spending money on life experiences (doing) makes people happier than spending money on possessions (having) (2)
- Spending money on possessions is linked to lower life satisfaction and higher risk of psychological illness – that is, it can actually undermine happiness (2)
Why don’t larger incomes make us happier? And why should doing make us happier than having? Psychologists have some suggestions. (2)
1. Whereas things fade into the background through hedonic adaptation, experiences continue to please through memories and shared anecdotes. Even crappy experiences can be re-interpreted or narrated as funny stories that give the teller pleasure.
2. A pay rise, house purchase or new car can disappoint if someone else has more. (And someone always does.) This may help account for dramatic income rises not bringing greater happiness.
Don’t underestimate the power of social comparison in eroding possession-pleasure. In one study half the participants preferred an income of $50,000 to $100,000. (Read that again.) The catch? Their peers would earn half as much in the first case ($25,000), and twice as much in the second ($200,000). (3)
Happiness strategy: Don’t keep up with the Joneses
Money is a truly wonderful resource. It can bring physical comforts, ease others’ suffering and give peace of mind. I want lots of money so I can have all these things – and more!
But if you’re using money as a barometer – an indicator of your social worth – then it’s less likely to make you happy than to bring you dissatisfaction and perhaps even psychological troubles. Decide not to play that game – set your financial goals based on your own needs and desires, not what others have. This is incredibly difficult for most of us to do, but reminding yourself that the comparison game is one you can never win might give you resolve.
Nor will filling your life with stuff create lasting happiness. Instead, think about spending your money on experiences – even simple ones like books, hobbies, outings with family and friends, or travel. These can add to your happiness in a way that’s not so short-lived.
Strategies 8, 9 and 10 have shown, perhaps counter-intuitively, that circumstances have a pretty small impact on happiness, and that life events affecting relationships, employment, money or health may temporarily change happiness, but hedonic adaptation will eventually, and in many cases quickly, return us to pre-change levels.
But what about genes – aren’t some people just born happier than others? That’s where we’ll pick up next time.
(1) Myers, D. G. (2000). The funds, friends, and faith of happy people. American Psychologist, 55(1), 56-67.
(3) Solnick, S. J., & Hemenway, D. (1998). Is more always better?: A survey on positional concerns. Journal of Economic Behavior & Organization, 37(3), 373-383.
(2) Van Boven, L. (2005). Experientialism, materialism, and the pursuit of happiness. Review of General Psychology, 9(2), 132-142.
This post is part of a series covering simple, practical, research-inspired, happiness strategies you can use in your own life. For more information about the series, check out the 101 Happiness Strategies main page.