Money does make you happier, new study finds.

[Andre1969]

Just heard this morning, on Dennis the Menace...

Banker (to Dennis): "You see, I've been in the banking business for many years, and I'm not a millionaire yet."
Dennis: "You sure look like one!"
Banker: "I do?"
Dennis: "Millionaires can have pie anytime they want. And you look like you've had it a LOT!!"

Out of the mouths of babes. And their script writers

 

[Car-Guy]

No, money doesn't really make me happy, but the things I can do and buy with money does. Never really cared much about just sitting in front of a pile of cash and looking at it.

 

[Lewis Clark]

I will never have enough money to knowingly waste food.

+1

I will never have enough money to knowingly waste anything. That's just how I am wired.

 

[pacergal]

Naturally I'd rather be rich, than poor, although I guess both has their own set of problems. In my own case, I'd say I'm reasonably happy. I'm not downright giddy, but not depressed, either. More money would make me happy, but I could definitely see a diminishing return.

For instance, if $1M was suddenly added to the value of my invested assets, I probably WOULD be downright giddy. However, a second million, on top of that, most likely wouldn't have the same effect. And, if I already had $20M, an additional $1M is nothing more than a couple of good days in a row on the stock market, so it's all relative.

Agree with this.
DH grew up with far less money than I. Throughout our marriage, he felt "rich" because we could afford a full refrigerator of food, paid all of our bills, and saved money to buy a house. To me, those were the basics of living and working.

We never made high salaries. We have had times of very limited budgets, but were always able to pay bills and always put money into savings every paycheck. Sometimes had about $20 left before payday!

Fast forward, due to our pensions and long stable employment, we have a bigger budget than I ever thought possible.
Would I like another million? Sure.
Another two or three? That's debatable as far as the happiness factor.

I am pretty happy now. Life is good. I feel very blessed.

 

[MichaelB]

This study, along with others, use “happiness” and “well-being” interchangeably. While I’ve never felt that more money = greater happiness, there’s no doubt that more money can lead to greater well-being.

The linked study also makes an interesting observation which challenges earlier studies. These conclude that more money leads to greater happiness, but there’s a ceiling to that effect. This study approaches the same data with a slightly different view, that unhappiness diminishes with increasing income, but the effect slows after reaching a point. This nuance is discussed in their paper here https://www.pnas.org/doi/10.1073/pnas.2208661120

 

[MarieIG]

+1

I will never have enough money to knowingly waste anything. That's just how I am wired.

+1 I am not a fan of waste, whether it's time, food, space, money or things (barring something that is actually damaging).

 

[O2Bfree]

I think as we our net worth increased our sense of financial security expanded to include being able to help close family members in need. In other words our “number” for happiness grew as we could not be happy if we weren’t able to help family members weather a crisis. If our other family members were very well off this “expansion of need” probably would not have happened.

This is a huge benefit! I was set up fine when I retired in 2019. Then when my mom died last year and left me a little more, I decided to give a nice chunk to my niece to help her and her BF buy a house. When I told her how much I was giving her she started crying and called it "life-changing." Man, that felt great—as good as when my portifolio hit the first $1M!

 

[Sojourner]

I will never have enough money to knowingly waste food.

I save all the odds and ends of vegetables in a plastic bag in the freezer and make vegetable broth out of them!

I've always been one who hated when fruits and vegetables would go bad before I had a chance to eat them, and I also hated throwing away (into the landfill, ultimately) veggie scraps. Nowadays, all of that goes into my kitchen compost bucket and then, once a week, into my big compost bin/tumbler. Feels so much better to know that all those scraps are going to be used to nourish my vegetable garden (and me!) instead of into some municipal landfill.

 

[yhoomajor]

But there is also the expense, if it costs $2K fix and you make $50K, that 2 weeks pay and if you don't have saving, you face the added worry of struggling how to pay for it. If you make $500K/year or have $5 million portfolio, then the expense is pretty much immaterial.

This is one of the reasons I'm still actively involved in managing my investment, is because having more money, just means there are fewer things I have to worry about paying for.

Having enough money reduces the "worry" side of equation. It allows you to worry less about material stuff.

It doesn't make you happy. It can be a trigger to allow you to think about possibilities and indulge in what makes one happy. But most people can be happy with very little money. As in people in Bhutan.

There is a reason many people who have lot of money are mean and miserable. But having money (or lack thereof) can change aspects of life people worry about.

 

[Sunset]

In our house, the dog was on standby so you had to be quick to get that meat off the floor or you lost it.

We had a dog as well. Waiting for something to drop.

For us, Sunday dinner was a big thing, Sometimes Mom would have something to roast up, like maybe a blade roast.

I recall Dad commenting on how our dog wasn't getting much by the time I had finished eating all the meat off the bone.

 

[ElizabethT]

One of the most popular post I've ever made on this forum, is discussing happiness and early retirement. I said that I found the most fulfilling and happy weeks of my life, were while working. The external validation, being a part of team, and something greater than yourself, were all hard for me to replicate post-retirement. On the flip side, my most miserable MONTHs were all while I was working. The stress, dealing with a bad boss, or having to sacrifice family or personal time, for work are all pretty horrible feelings.

.

To speak firstly to the title of this thread, I do find happiness in utilizing our discretionary income for experiences more so than for things - unless those things by default will deliver experiences. (i.e., our upgraded bicycles, kayaks, travel trailer, etc.). Most recently we've signed up for music, golf, and bridge lessons, all of which are expanding our world via new skills, friendships and outlets.

To speak to above snippet of OP - I'm wondering if you set to challenge yourself in retirement similar to how you may have done in your career, if you wouldn't find the same level of fulfillment and happiness. Myself, I much, much enjoyed my career, but I have no highs in hindsight that match the highs of the personal goals I've set and achieved. As just one example, we are currently in the midst of training for a walk across Spain, and I expect the achievement of that later this year to be an immense high. This training has also inspired me to be more diligent at improving my Spanish, the implementation of which also gives me a tremendous level of personal joy.

Retirement for me is about continuing to strive and to achieve, but the specifics are now intrinsic to my core beliefs and interests. YMMV of course.

 

[HawkOwl]

If you really dig into the study and results you will see at the end, there are very few people in the highest income category, only 1.2%. So, you could have a problem with results if you happened to have an abnormal amount of 'unhappy' in the highest income (as defined by the study's questions) people respond to the study because of the small size at this income level (it is only about 340 people at this income level so just a few people could skew results for this category). Also, they are going off of income, not assets/net worth. I could have $30 million of Muni bonds, what is my income, $0. Finally, on income, it implies that they are focusing on working people, in fact the average age is in the 30s.

The other big issue is their binary questioning. Meaning, if a higher income person is really, really, really happy their response for analysis in the study would be the same as a person who is 'just' happy and that 'just' happy person makes half of what the high income really, really, really happy person makes.

As you can tell, I think these types of studies are silly. What are they trying to accomplish? A way to make someone struggling to get by because they live in a HCOL area making $80,000 a year that they should feel happy because others in their same income category are? They do not even take geography into consideration.

I remember when I was building my business and struggling, I was happy (working hard, using my brain, building something, etc.). I am blessed to be sitting on some money and I am happy now for other reasons (spending time with wife and kids, travel anywhere on a moment's notice, etc.).

Finally, anyone who says money does not help is, I do not believe, being honest. It takes a major stressor off the table and more importantly, it buys time, and time is one of the few limitations in life.

+1

Excellent critique.

 

[HawkOwl]

I found the most fulfilling and happy weeks of my life, were while working. The external validation, being a part of team, and something greater than yourself, were all hard for me to replicate post-retirement. On the flip side, my most miserable MONTHs were all while I was working. The stress, dealing with a bad boss, or having to sacrifice family or personal time, for work are all pretty horrible feelings.

My exact experiences too.

 

[Sojourner]

There is a reason many people who have lot of money are mean and miserable. But having money (or lack thereof) can change aspects of life people worry about.

I've known very rich people who are nice, and some who are mean and miserable. It's a spectrum. But, I feel certain that as wealth continues to increase beyond some "comfortable" level, anxiety and stress related to keeping that wealth (and growing it) would also increase. So that would mitigate, to some degree, whatever gains in happiness and well-being one would feel. The richest person I've ever known (my ex-boss) was a pretty happy, easy-going guy, but I know he was constantly stressed by growing his wealth and minimizing the amounts he was paying in taxes, fees, and expenses.

 

[Letj]

I save all the odds and ends of vegetables in a plastic bag in the freezer and make vegetable broth out of them! I learned that from my late DH, who grew up poor.



I agree that just having enough money to remove stressors from your life increases happiness. A couple of years ago my car died while I was visiting DS and DDIL 3 hours away. It needed the transmission replaced- not worth the value of the car. I chose a new car from the local dealer site, negotiated a price, had money transferred to my checking account and picked it up the next day. OK, it was only a Honda Civic, but still...the scenario could have been totally different if I'd owned a beater with a loan balance on it and had to run around looking for an affordable used car and the financing to buy it.



At this point I may have reached a plateau- more money would not make me any happier.

I wish it were the same for me. I do like spending on experiences and having money to help others in need, especially family. However, spending money to make my life easier is very hard. For example, I hate paying the $550 a month for a cleaner and another $250 for lawn services. The same is true for high end resorts, hotels, expensive bags, expensive clothes, first class travel, etc. I already made up my mind that the value isn’t there to justify spending this kind of money. Also, in my mind, it seems that anything I can do myself or learn to do myself, I shouldn’t pay someone to do and when I do, I feel I’ve wasted money. It’s a hard to shake mindset. The same goes for replacing appliances, etc. For example, if my refrigerator goes right after the warranty expires, I fret about the replacement and blame the manufacturer for making a bad product. Maybe if I had stupid money I won’t care.

 

[Amethyst]

Were I still working, I would be earning more than $80 an hour, maybe $50 after taxes and deductions. So I value my time at $50 an hour. If it takes me 10 hours to do something that a pro could knock out in 4-5 hours for $500, it's better to pay the pro.

(Naturally, if I would be unable to do the task properly, I pay the pro!)

 

[ownyourfuture]

Studies, Smudies
Anyone who tells you money can't buy happiness, never had any.
Some say Samuel L Jackson is the owner of this quote.

 

[Sunset]

I've noticed poor and lower middle class folk, often talk about money in a negative way. There is the mis-quoted saying heard often: "Money is the root of all evil".
There is also the common believe rich folks are miserly, stingy, fretting over their money all the time, like scrooge McDuck.

I think this is self satisfying , sort of a sour grapes attitude. "I can't get the grapes , but they are probably sour anyway".

Of the rich and wealthy folks I personally knew, all I ever saw was the opposite, they seemed so normal I didn't know most of them were rich/wealthy.

 

[rk911]

If you were wealthy, you could/would just hire someone to handle the situation for you, or have them on staff all the time, as groceries need to be purchased and cooked, and the house cleaned, doctor appt's to make, and travel arranged, etc...

i'm unclear what 'happy' means with respect to this thread. for me, i've substituted 'calm' or 'at peace' for 'happy'. we've reached a NW where we don't worry one iota about bills or what something costs. we haven't gone 'just-won-the-lottery' crazy and we do hire some services like housecleaning, lawn care and snow removal but we have no permanent household staff. outwardly, we live a very average middle class life driving 20-yr and 10-yr old cars. it would be a hassle if the car breaks down or a major appliance gives up the ghost but only in terms of logistics but not in the sense of 'how the heck are we gonna pay for this?'. so, if that equates to 'happy' then we're very much at peace.

 

[RobbieB]

Makes me happier. I much prefer to see gains vs losses in the monthly statement. Easy.

 

[ER Eddie]

I also see the reverse, Sunset, with wealthy people embracing the belief that money is a sign of your worth or merit. It makes them feel better about themselves.

I wonder sometimes about our American preoccupation with happiness. Sometimes, we seem to measure our success in life in terms of how happy we are. We put on a happy face, because there is the cultural expectation that we should be happy, and if we're not, something is wrong. I fall into this trap myself, so I'm not pointing fingers.

I have read a lot of happiness literature, and you can draw some tips from it, but ultimately most of it is pretty shallow. Happiness is not the be-all, end-all of human life. There are more important things than whether you are happy or not. Happiness is not the measure of your success as a person.

 

[marko]

Money can't buy happiness but it can buy the most remarkable substitutes. (A. McNally)

 

[MC Rider]

Just heard this morning, on Dennis the Menace...

Banker (to Dennis): "You see, I've been in the banking business for many years, and I'm not a millionaire yet."
Dennis: "You sure look like one!"
Banker: "I do?"
Dennis: "Millionaires can have pie anytime they want. And you look like you've had it a LOT!!"

Out of the mouths of babes. And their script writers

Money does not bring happiness.
Pie on the other hand....


I never cared about getting rich. Just do not want to be poor and broke.

 

[albireo13]

I've noticed poor and lower middle class folk, often talk about money in a negative way. There is the mis-quoted saying heard often: "Money is the root of all evil".
There is also the common believe rich folks are miserly, stingy, fretting over their money all the time, like scrooge McDuck.

I think this is self satisfying , sort of a sour grapes attitude. "I can't get the grapes , but they are probably sour anyway".

Of the rich and wealthy folks I personally knew, all I ever saw was the opposite, they seemed so normal I didn't know most of them were rich/wealthy.

Of course they seem "normal". They don't have the stress of trying to feed your family vs. pay the bills. The sour grape narrative is a defense mechanism, to help folks get through tough times.

Money isn't the root of all evil. It is close to it though.
Noone commits crimes in the pursuit of a good yogurt! But money??

 

[albireo13]

Money does not provide happiness. It reduces stress.
After the stress is reduced, it is up to the individual to fill in the blank spaces with happiness. Money won't do it for them.