Money does buy happiness!

[HI Bill]

We usually made our kids work for what they "wanted" (not what they needed.)

Good job! I never had kids, but know that if I'd been handed everything I wanted, I'd have ended up failing as a productive member of society, rather than being here, and 11 days to FIRE.

 

[Joggernot]

Sometimes, happiness is not for sale!

People without electricity, water, heating gas, gasoline in Texas cannot buy these commodities now despite having money.

Just got power and water back. Gas lines are/were 5 blocks long as were the lines for propane (lots of RVs down here).

 

[Montclairbobbyb]

Clearly everyone is unique. For me, it's primarily about simplifying my life, about living in a beautiful, high quality setting with vastly reduced complexity, minimal stress and fewer "moving parts" that I would otherwise worry (stress) about.
Fortunately I (believe) I have saved enough to fund this happy, modest lifestyle, and while that's generally good enough, I will continue to pursue opportunities to increase my wealth, to raise the quality level, without adding complexity or stress. For example, I have lost the desire to own a vacation home or even a bigger primary home, even though I could... I simply don't want the added responsibility. But I have to be honest; additional wealth (while not absolutely necessary) could always find a place in raising my standard of living, even in my "humble & content" universe.

 

[kcowan]

We have been "Blowing the dough" for 18 months, and we like it!

Our prior SWR was under 2% and some of our "friends" resent it but we need to live our own lives before it is too late.

New luxury condo, new to us Mercedes. Still buy bargain wines but sometimes splurge.

 

[JJpop]

Like so much today everything is over analyzed. This 75,000 figure is more of that.
Money is a tool. If you misuse it by your choice of lifestyle do not blame it on the tool. If you use the tool properly, it can be incredibly useful and comforting.
As a society we look to find excuses for our failings or unhappiness.
“If I hadn’t made that million in stock options I would never had done.........”
Fill in the blank. Do not blame it on the money.
“That million I made in stock options allowed me to buy my parents a house,pay to send my kids to a great college and allowed all of us to go on a couple fantastic vacations .”
I believe the above would bring more happiness to most people. Did they have to have that to be happy? No. Did it increase their happiness....well yes for most people.

 

[JustCurious]

It's all relative to one's circumstances and personality. An average person making $30,000 who gets a raise to $60,000 would probably experience a significant increase in happiness, whereas someone making $300,000 who gets a raise to $330,000 may not even notice.

 

[MichealKnight]

Precisely, it's all relative. I heard someone say long time ago, and I guess I sort of have accepted this philosophy. Now keep in mind, I'm not applying this *solely* to having one's obligations met and being retired, I'm saying - to me- in general for all of life.

Money doesn't buy happiness....but it's a good down payment.

 

[Love This Community]

I forgot to add that an obvious corollary from the above observation is that:

"Happiness is more expensive for rich people than it is for the poor" - NW-Bound

Love this quote. Very well put.

 

[kingfisher]

Once I got above $50,000/yr income, my happiness didn't change that much. I was happiest when I made much less. And now I make six figures.

I feel pretty happy having money for the future and knowing I'll be able to support myself when I retire, but I'm not really happy spending money.

but I bet you're less happy not because you makes more money right? To keep everything else being equal, don't you think more money would buy you more happiness?

 

[teetee]

Increasing the saving power gives me more happiness. When the economy is good, I am happy because better ability to save will allow me to FIRE faster. In the recession and the situation that I losey income, I am happy because I know my emergency fund will last longer and I won't have to adjust my life style greatly to adapt to the low cash situation since I am already frugal.

It is all relative but I can choose. My choice is based on the potential rather than the numbers I accumulated on my spreadsheet. Having the ability to choose makes me happy too. Money plays an important role in that process. That's the part that I am the same as most people.

 

[EastWest Gal]

There is a bit of momentary happiness when that paycheck hits the bank account. Starting in 2013, the growth of our portfolio vastly outstripped my annual pay. In the last 2 years our portfolio has grown by 3x my former annual salary.

There is no happiness in enduring bullying at work and swollen legs from standing for 8-12 hours or panicking on your way to work because you routinely had far more work to do than you could reasonably handle, just to see more money in the bank. Now that more than enough money is in the portfolio, that's off the "to do" list.

 

[teetee]

Money in itself - if it just piles up and sits there is not going to make most people happy. You need to use it to actually buy yourself that happiness, whatever it means to you. In my case it's freedom to use my time how I see fit.

Interestingly, that all got upended by Covid. No amount of money will let me travel the way I used to: vagabonding across borders with barely any plan. So anecdotally, it's definitely true that more money (and my portfolio grew by by more than 30% last year) does not translate into more happiness.

I don't know. I am plenty happy seeing my NW double in 2 years. I don't need to make my car salesman happy in order to make myself happy.

 

[explanade]

This is just one study.

Why is it more valid than another study, the one which cited the $75k threshold?

Some or many of us probably have more money than we imagined, with equity valuations at all-time highs.

But if your net worth was 10x or 100x greater, would you be happier?

For instance, I have to acquire a new car soon, because my lease is up soon. Would I be happier if I spent say the average of what a new car goes for or 2x the average sales price?

Or 4x?

I really doubt it. I like technology and appreciate refined engineering and design. But I barely drive 3k miles a year. I could make do with a used car. Now there's more aggravation potential with an unreliable car not under warranty.

But I doubt I’d derive more happiness if I had a car well over $100k which was very fast or had plush interiors.

In fact I do more heavy driving overseas. I just rented a car for about 2 weeks in Austria and Italy and put over 1400 kilometers on it. It was a compact auto, don’t even remember the model or brand, but it was French.

It was fine but I could have spent 30-50% more, probably rented a Benz or Audi instead. The car accelerated fine for my trip, which included some mountain passes.

The main annoyance was that the trunk would only fit one of my suitcases. The carryon I had to put in the back seat.

A larger car would have been nice but then also a pain to park in some places.

If I spent more, it probably would have nagged me spending money that I could afford but being a poor value for the incremental benefits.


Also spent good money on lodging. Of course I could have stayed at more expensive places, had more expensive meals. But I didn’t shortchange myself, was more than fine with the places I chose and meals I had.

The one thing I would have enjoyed more is better weather. Didn’t see as many things because the weather wasn’t as good as I hoped but this area of the world gets a lot of rain, one reason I keep going back, just rolling the dice to get better weather next time.

Can more money buy better weather? Well I suppose you could chase good weather, be able to travel at the drop of a hat. But I can do that, though it wouldn’t be jumping on my own private jet.

So maybe I’m lacking in imagination but I don’t think having 10x or 100x would bring more happiness.

Maybe if I’d been born rich, I’d have. Different outlook, would have certain expectations which would need to be met or I’d be discontented.

For instance maybe taking an Uber would be unacceptable, would need at least a town car.

Or maybe chicken would be poor peoples food, completely unacceptable for any meal.

 

[Navigator]

This is just one study.

Why is it more valid than another study, the one which cited the $75k threshold?

The study cited to claim the $75K threshold is misunderstood in the press. It shows an inflection point in the income vs. happiness graph where happiness does not increase as rapidly after someone has $75K in income, but it still increases. A problem with these studies is that a scale of 1 to 10 is used. Once someone reaches a score of 8 or above it’s hard to increase the happiness score because the score is already close to the top of the scale.

 

[FloridaJim57]

Another rule of thumb

Alchol does not solve any problems but neither does milk. Money does not buy happines but it is better to worry in Rolls Royce than on a bicycle.

 

[stepford]

Money does not buy happines but it is better to worry in Rolls Royce than on a bicycle.

I would MUCH rather be worried on a bike than in a Rolls. Then again I'd much rather do pretty much anything on a bike than in a Rolls.

 

[daylatedollarshort]

Here is a bit more from the author of the Wharton happiness study: "Higher earners are happier, in part, because of an increased sense of control over life, he says. “When you have more money, you have more choices about how to live your life. You can likely see this in the pandemic. People living paycheck to paycheck who lose their job might need to take the first available job to stay afloat, even if it’s one they dislike. People with a financial cushion can wait for one that’s a better fit. Across decisions big and small, having more money gives a person more choices and a greater sense of autonomy.

Yet it might be best not to define success in monetary terms, he says. “Although money might be good for happiness, I found that people who equated money and success were less happy than those who didn’t. I also found that people who earned more money worked longer hours and felt more pressed for time.

Though the study does show that income matters beyond a previously believed threshold, Killingsworth also doesn’t want the takeaway to enforce an idea that people should focus more on money. In fact, he found that, in actuality, income is only a modest determinant of happiness.

“If anything, people probably overemphasize money when they think about how well their life is going,” says Killingsworth. “Yes, this is a factor that might matter in a way that we didn’t fully realize before, but it’s just one of many that people can control and ultimately, it’s not one I’m terribly concerned people are undervaluing.” Rather, he says he hopes this research can help move forward the conversation in an attempt to find what he calls the “equation for human happiness.”

https://penntoday.upenn.edu/news/money-matters-to-happiness-perhaps-more-than-previously-thought

 

[NW-Bound]

Alchol does not solve any problems but neither does milk. Money does not buy happines but it is better to worry in Rolls Royce than on a bicycle.

Any decent car will work for me. In fact a car that draws attention is one I would avoid. Public attention may bring unhappiness.

 

[RobbieB]

Yes, money allows me choices and freedom. Freedom makes me happy. Freedom to do whatever I want to do.

I've lived my whole life that way. I did;

1) What I had to do.
2) The most of what I wanted to do.
3) The least of what others wanted me to do.

 

[W2R]

Here is a bit more from the author of the Wharton happiness study: "Higher earners are happier, in part, because of an increased sense of control over life, he says. “When you have more money, you have more choices about how to live your life."

More money? Well, more than what?

I guess I don't need to run around spending more money willy-nilly, because I am stupendously happy with my present spending and the choices I now have about how to live my life. Here I sit in my Dream Home, with all the time in the world, living next door to the most wonderful guy ever and he treats me like a queen. We have a great time together every single day (pandemic or not). Best years of my life by far, and I honesty can't think of any other choices I'd like better.



This is so much better than the first half century of my life, for sure. That said I know that nothing lasts forever so I cherish each day. Apparently all our mothers were right, when they told us "good things happen to those who wait".

 

[daylatedollarshort]

More money? Well, more than what?

I guess I don't need to run around spending more money willy-nilly, because I am stupendously happy with my present spending and the choices I now have about how to live my life. Here I sit in my Dream Home, with all the time in the world, living next door to the most wonderful guy ever and he treats me like a queen. We have a great time together every single day (pandemic or not). Best years of my life by far, and I honesty can't think of any other choices I'd like better.



This is so much better than the first half century of my life, for sure. That said I know that nothing lasts forever so I cherish each day. Apparently all our mothers were right, when they told us "good things happen to those who wait".

The study author explains in the next part of the paragraph how more money means more freedom to not have to work at a job you might hate, or in your case to not have to work at all.

 

[brett]

We have more money than we will ever need.

This week I reviewed our investments. They have grown substantially over the past 9 years. I never envisioned that we would have this much.

Does it make me happy. It has not appreciably changed our lifestyle.

The only change in happiness is the realization, unbeknownst to either of our two children, that we are in a position to secure their respective retirements when the time comes. Regardless of how much they may or may not have on their respective retirement dates.

 

[explanade]

Worse comes to worse, if I had 1/10 the money, I could go live in some very low-cost area like SE Asia or Central/South America and still have the same relative control, not have to work, being in control over my time.

That's the other thing, in other surveys of happiness, I recall that many poor nations were on the top of such surveys. Presumably they have jobs which we in the developed nations would find unbearable and standard of living which we'd find intolerable.

Or even in this country, you have some migrant farm workers thrive in those jobs. Shortly after the financial crisis, some unemployed Americans tried to see if they could pick tomatoes at piecemeal wages. I think this was in MI or AL. The novices couldn't last the day in the heat and humidity and they didn't pick much but one Hispanic worker earned the equivalent of over $20 an hour. He obviously stuck with the job and got good at it. Again, Americans wouldn't do this type of work but maybe for this guy, compared to the conditions in the place where he was born and grew up, picking tomatoes in the heat and humidity for wages which are a lot more than he would ever dream of back home was comparatively a great situation.

Then we have accounts of people making $300k or more but feeling poor living in Brooklyn. Turns out they had high expenses like private schools and such but they felt these were all necessary expenditures, even if they were unable to save money.

 

[Scuba]

I agree with the point about money making life a lot easier and providing more options, which leads to being happier. I love having enough resources so that we don’t have to worry when unexpected expenses come up. For example, the refrigerator in our rental condo died unexpectedly. We have a tenant there on a 2-year lease that is paying us substantial rent. Between COVID and other issues, appliances aren’t that easy to come by these days. I called a few places and after being told by Home Depot, Lowe’s and Best Buy that nothing could be delivered within the next 5 days, a specialty appliance store quoted us about $2,100 to replace our previous fridge, delivered and installed and hauling away the old one. Sold!

A long time ago, having an unexpected cost of over $2K would have meant something else would have to be cut. Now it’s just “oh well” without really worrying much about it. And in this case since time was more important than pride, I didn’t worry about trying to save $100 or $200 … we just did it. Really great to be able to do that without giving it a second thought.

Just a small example but for me, this type of financial security definitely makes me happy. I remember in college when I had to have a car to have a job, but all the money I made at my job went to fix my crappy used car that was the only car I could afford.

 

[RobbieB]

Yeah. I remember soldering leaks in my radiator 3 times before I bought a recore.