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You have probably seen or heard about several quotes about money- money can’t buy happiness, money doesn’t grow on trees, money can’t buy you love, money makes the world go round and so forth. Many songs have been recorded about money with each song having divergent views on money. The big question is, does having or spending money lead to happiness?
The quick answer is yes, but it’s not always true.
The popular misconception is that more money equals more happiness. Happiness can be defined and measured in a variety of ways. Most people believe that they can get the ultimate satisfaction by buying the things they want most. Studies, however, are swift to correct this notion.
The more money you earn, the more you are likely to spend commuting, working and doing other activities that bring you little pleasure. Instead of shifting towards passive leisure activities associated with happiness, you will be more concerned about compulsory non-work activities.
Generally speaking, there is some truth to the idea that happiness and money aren’t linked inextricably. But despite the fact that people living in poverty tend to be less happy than rich people, the moment your income affords a reasonably comfortable life, getting richer doesn’t necessarily mean being happier. The more materialistic you are, the less happy you will be.
You are more likely to be depressed and have low self-esteem issues if you are materialistic. Materialistic urges will also make you less willing to get involved in your community. Your wellbeing has a more significant impact on your happiness than your income level.
So to answer your question, YES there is science backed evidence that money doesn’t lead to happiness. A higher socioeconomic status doesn’t boost subjective well-being. According to a recent study by a team of researchers from the London School of Economics, your happiness is based on your physical and mental health as well as your personal relationships.
On account of Lord Richard Layard, the lead researcher in the study, even if you earn more than you need, you will not be really happy because the cause of your unhappiness is not economic constraints.
The study further pointed out that when anxiety and depression are removed from the picture, your unhappiness will also reduce by 20%. Compare this with the 5% of your misery that will lessen when poverty is eliminated, and you’ll get a clearer picture. Tackling mental issues will be 4 times as effective as addressing poverty. The increase in educational attainment and income have a small effect on your happiness. Being with someone that matters to you can enhance the feeling of happiness.
Another study by researcher Richard Easterlin proved that transforming a country from poverty to affluence doesn’t make the nation’s population happier. Easterlin, an Economics Professor at the University of Southern Carolina, conducted the study in 54 developed and developing countries worldwide.
According to him, happiness does not increase with the rate of economic growth even in transitional countries. Money does not buy happiness over the long term. Over time, the higher the country’s income is doesn’t translate to increased happiness. In his research, he noted that many countries in Europe and Asia exhibited astronomical economic growth but no improvement in satisfaction or happiness.
In the short term growth feels right to you while an economic constraint or collapse is agonising. In the long run, however, more money creates more want. As your income rises, your aspirations also increase, and in the course of time, the adjustment in goals negates the effect of fluctuating income. Besides leading you to take things for granted, raised aspirations also impair your savouring abilities.
They steer you to overspend and under save, consume more than necessary, live beyond your means, go into debt and do other dumb things you can’t afford. This implies that you should focus on non-monetary factors that influence happiness. Such factors could include family and health concerns.
The best way to spend money is using it on activities that help you grow as a person, like investing in an entrepreneurial venture, giving back to the community or taking music lessons. Rather than spending your money on big ticket item like a luxury car or yacht, try spending it on small pleasures like frequent massage sessions or regular phone calls to your best friend overseas.
By splurging on an event you have worked above and beyond to get tickets and having to wait for it, you will relish the feeling of anticipation and well-deserved accomplishment. To put it into perspective, your money will be even better spent if you take the time to appreciate what you’re spending it on.
By working your way to inject surprise, novelty and surprise instead of comparing yourself with others, you will derive the maximum possible satisfaction from the activities and objects of your spending.
It appears natural that happiness flows from having more money. In reality, however, more money actually has very little to do with happiness. The sad thing is that most people often seem aware of this fact and yet continue to work hard day and night to earn more money than they objectively need. It’s relative income that is important.
You need a certain amount of money to be happy, and once you exceed that limit, you would not see much of a noticeable difference when it boils down to your happiness score. Money may grant you the opportunity to buy many things, but it also impairs your ability to enjoy those things. While money allows you to experience the best things that life has to offer, it ultimately undermines your ability to savour the little pleasures that bring the most happiness in life.
Well this depends on your definition of matter. It’s true that with more money you may be more satisfied with your life, but this doesn’t imply that you’ll be automatically happier. There is a difference between happiness and satisfaction.
Being in the upper echelon of the social class won’t necessarily rank you in the upper echelon of happiness. By surrounding yourself with people that mean the most to you and engaging in meaningful activities, you will be on your way to achieving ultimate happiness.