money or happiness essay

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Does More Money Really Make Us More Happy?

• Elizabeth Dunn
• Chris Courtney

A big paycheck won’t necessarily bring you joy

Although some studies show that wealthier people tend to be happier, prioritizing money over time can actually have the opposite effect.

• But even having just a little bit of extra cash in your savings account ($500), can increase your life satisfaction. So how can you keep more cash on hand?
• Ask yourself: What do I buy that isn’t essential for my survival? Is the expense genuinely contributing to my happiness? If the answer to the second question is no, try taking a break from those expenses.
• Other research shows there are specific ways to spend your money to promote happiness, such as spending on experiences, buying time, and investing in others.
• Spending choices that promote happiness are also dependent on individual personalities, and future research may provide more individualized advice to help you get the most happiness from your money.

Where your work meets your life. See more from Ascend here .

How often have you willingly sacrificed your free time to make more money? You’re not alone. But new research suggests that prioritizing money over time may actually undermine our happiness.

• ED Elizabeth Dunn is a professor of psychology at the University of British Columbia and Chief Science Officer of Happy Money, a financial technology company with a mission to help borrowers become savers. She is also co-author of “ Happy Money: The Science of Happier Spending ” with Dr. Michael Norton. Her TED2019 talk on money and happiness was selected as one of the top 10 talks of the year by TED.
• CC Chris Courtney is the VP of Science at Happy Money. He utilizes his background in cognitive neuroscience, human-computer interaction, and machine learning to drive personalization and engagement in products designed to empower people to take control of their financial lives. His team is focused on creating innovative ways to provide more inclusionary financial services, while building tools to promote financial and psychological well-being and success.

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Can Money Really Buy Happiness?

Money and happiness are related—but not in the way you think..

Updated November 10, 2023 | Reviewed by Chloe Williams

• More money is linked to increased happiness, some research shows.
• People who won the lottery have greater life satisfaction, even years later.
• Wealth is not associated with happiness globally; non-material things are more likely to predict wellbeing.
• Money, in and of itself, cannot buy happiness, but it can provide a means to the things we value in life.

Money is a big part of our lives, our identities, and perhaps our well-being. Sometimes, it can feel like your happiness hinges on how much cash is in your bank account. Have you ever thought to yourself, “If only I could increase my salary by 12 percent, I’d feel better”? How about, “I wish I had an inheritance. How easier life would be!” I don’t blame you — I’ve had the same thoughts many times.

But what does psychological research say about the age-old question: Can money really buy happiness? Let’s take a brutally honest exploration of how money and happiness are (and aren’t) related. (Spoiler alert: I’ve got bad news, good news, and lots of caveats.)

Higher earners are generally happier

Over 10 years ago, a study based on Gallup Poll data on 1,000 people made a big headline in the news. It found that people with higher incomes report being happier... but only up to an annual income of $75,000 (equivalent to about $90,000 today). After this point, a high emotional well-being wasn’t directly correlated to more money. This seemed to show that once a persons’ basic (and some “advanced”) needs are comfortably met, more money isn’t necessary for well-being.

But a new 2021 study of over one million participants found that there’s no such thing as an inflection point where more money doesn’t equal more happiness, at least not up to an annual salary of $500,000. In this study, participants’ well-being was measured in more detail. Instead of being asked to remember how well they felt in the past week, month, or year, they were asked how they felt right now in the moment. And based on this real-time assessment, very high earners were feeling great.

Similarly, a Swedish study on lottery winners found that even after years, people who won the lottery had greater life satisfaction, mental health, and were more prepared to face misfortune like divorce , illness, and being alone than regular folks who didn’t win the lottery. It’s almost as if having a pile of money made those things less difficult to cope with for the winners.

Evaluative vs. experienced well-being

At this point, it's important to suss out what researchers actually mean by "happiness." There are two major types of well-being psychologists measure: evaluative and experienced. Evaluative well-being refers to your answer to, “How do you think your life is going?” It’s what you think about your life. Experienced well-being, however, is your answer to, “What emotions are you feeling from day to day, and in what proportions?” It is your actual experience of positive and negative emotions.

In both of these studies — the one that found the happiness curve to flatten after $75,000 and the one that didn't — the researchers were focusing on experienced well-being. That means there's a disagreement in the research about whether day-to-day experiences of positive emotions really increase with higher and higher incomes, without limit. Which study is more accurate? Well, the 2021 study surveyed many more people, so it has the advantage of being more representative. However, there is a big caveat...

Material wealth is not associated with happiness everywhere in the world

If you’re not a very high earner, you may be feeling a bit irritated right now. How unfair that the rest of us can’t even comfort ourselves with the idea that millionaires must be sad in their giant mansions!

But not so fast.

Yes, in the large million-person study, experienced well-being (aka, happiness) did continually increase with higher income. But this study only included people in the United States. It wouldn't be a stretch to say that our culture is quite materialistic, more so than other countries, and income level plays a huge role in our lifestyle.

Another study of Mayan people in a poor, rural region of Yucatan, Mexico, did not find the level of wealth to be related to happiness, which the participants had high levels of overall. Separately, a Gallup World Poll study of people from many countries and cultures also found that, although higher income was associated with higher life evaluation, it was non-material things that predicted experienced well-being (e.g., learning, autonomy, respect, social support).

Earned wealth generates more happiness than inherited wealth

More good news: For those of us with really big dreams of “making it” and striking it rich through talent and hard work, know that the actual process of reaching your dream will not only bring you cash but also happiness. A study of ultra-rich millionaires (net worth of at least $8,000,000) found that those who earned their wealth through work and effort got more of a happiness boost from their money than those who inherited it. So keep dreaming big and reaching for your entrepreneurial goals … as long as you’re not sacrificing your actual well-being in the pursuit.

There are different types of happiness, and wealth is better for some than others

We’ve been talking about “happiness” as if it’s one big thing. But happiness actually has many different components and flavors. Think about all the positive emotions you’ve felt — can we break them down into more specifics? How about:

• Contentment
• Gratefulness

...and that's just a short list.

It turns out that wealth may be associated with some of these categories of “happiness,” specifically self-focused positive emotions such as pride and contentment, whereas less wealthy people have more other-focused positive emotions like love and compassion.

In fact, in the Swedish lottery winners study, people’s feelings about their social well-being (with friends, family, neighbors, and society) were no different between lottery winners and regular people.

Money is a means to the things we value, not happiness itself

One major difference between lottery winners and non-winners, it turns out, is that lottery winners have more spare time. This is the thing that really makes me envious , and I would hypothesize that this is the main reason why lottery winners are more satisfied with their life.

Consider this simply: If we had the financial security to spend time on things we enjoy and value, instead of feeling pressured to generate income all the time, why wouldn’t we be happier?

This is good news. It’s a reminder that money, in and of itself, cannot literally buy happiness. It can buy time and peace of mind. It can buy security and aesthetic experiences, and the ability to be generous to your family and friends. It makes room for other things that are important in life.

In fact, the researchers in that lottery winner study used statistical approaches to benchmark how much happiness winning $100,000 brings in the short-term (less than one year) and long-term (more than five years) compared to other major life events. For better or worse, getting married and having a baby each give a bigger short-term happiness boost than winning money, but in the long run, all three of these events have the same impact.

What does this mean? We make of our wealth and our life what we will. This is especially true for the vast majority of the world made up of people struggling to meet basic needs and to rise out of insecurity. We’ve learned that being rich can boost your life satisfaction and make it easier to have positive emotions, so it’s certainly worth your effort to set goals, work hard, and move towards financial health.

But getting rich is not the only way to be happy. You can still earn health, compassion, community, love, pride, connectedness, and so much more, even if you don’t have a lot of zeros in your bank account. After all, the original definition of “wealth” referred to a person’s holistic wellness in life, which means we all have the potential to be wealthy... in body, mind, and soul.

Kahneman, D., & Deaton, A.. High income improves evaluation of life but not emotional well-being. . Proceedings of the national academy of sciences. 2010.

Killingsworth, M. A. . Experienced well-being rises with income, even above $75,000 per year .. Proceedings of the National Academy of Sciences. 2021.

Lindqvist, E., Östling, R., & Cesarini, D. . Long-run effects of lottery wealth on psychological well-being. . The Review of Economic Studies. 2020.

Guardiola, J., González‐Gómez, F., García‐Rubio, M. A., & Lendechy‐Grajales, Á.. Does higher income equal higher levels of happiness in every society? The case of the Mayan people. . International Journal of Social Welfare. 2013.

Diener, E., Ng, W., Harter, J., & Arora, R. . Wealth and happiness across the world: material prosperity predicts life evaluation, whereas psychosocial prosperity predicts positive feeling. . Journal of personality and social psychology. 2010.

Donnelly, G. E., Zheng, T., Haisley, E., & Norton, M. I.. The amount and source of millionaires’ wealth (moderately) predict their happiness . . Personality and Social Psychology Bulletin. 2018.

Piff, P. K., & Moskowitz, J. P. . Wealth, poverty, and happiness: Social class is differentially associated with positive emotions.. Emotion. 2018.

Jade Wu, Ph.D., is a clinical health psychologist and host of the Savvy Psychologist podcast. She specializes in helping those with sleep problems and anxiety disorders.

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Research: Can Money Buy Happiness?

In his quarterly column, Francis J. Flynn looks at research that examines how to spend your way to a more satisfying life.

September 25, 2013

A boy looks at a toy train he received during an annual gift-giving event on Christmas Eve 2011. | Reuters/Jose Luis Gonzalez

What inspires people to act selflessly, help others, and make personal sacrifices? Each quarter, this column features one piece of scholarly research that provides insight on what motivates people to engage in what psychologists call “prosocial behavior” — things like making charitable contributions, buying gifts, volunteering one‘s time, and so forth. In short, it looks at the work of some of our finest researchers on what spurs people to do something on behalf of someone else.

In this column I explore the idea that many of the ways we spend money are prosocial acts — and prosocial expenditures may, in fact, make us happier than personal expenditures. Authors Elizabeth Dunn and Michael Norton discuss evidence for this in their new book, Happy Money: The Science of Smarter Spending . These behavioral scientists show that you can get more out of your money by following several principles — like spending money on others rather than yourself. Moreover, they demonstrate that these principles can be used not only by individuals, but also by companies seeking to create happier employees and more satisfying products.

According to Dunn and Norton, recent research on happiness suggests that the most satisfying way of using money is to invest in others. This can take a seemingly limitless variety of forms, from donating to a charity that helps strangers in a faraway country to buying lunch for a friend.

Witness Bill Gates and Warren Buffet, two of the wealthiest people in the world. On a March day in 2010, they sat in a diner in Carter Lake, Iowa, and hatched a scheme. They would ask America‘s billionaires to pledge the majority of their wealth to charity. Buffet decided to donate 99 percent of his, saying, “I couldn‘t be happier with that decision.”

And what about the rest of us? Dunn and Norton show how we all might learn from that example, regardless of the size of our bank accounts. Research demonstrating that people derive more satisfaction spending money on others than they do spending it on themselves spans poor and rich countries alike, as well as income levels. The authors show how this phenomenon extends over an extraordinary range of circumstances, from a Canadian college student purchasing a scarf for her mother to a Ugandan woman buying lifesaving malaria medication for a friend. Indeed, the benefits of giving emerge among children before the age of two.

Investing in others can make individuals feel healthier and wealthier, even if it means making yourself a little poorer to reap these benefits. One study shows that giving as little as $1 away can cause you to feel more flush.

Quote Investing in others can make you feel healthier and wealthier, even if it means making yourself a little poorer.

Dunn and Norton further discuss how businesses such as PepsiCo and Google and nonprofits such as DonorsChoose.org are harnessing these benefits by encouraging donors, customers, and employees to invest in others. When Pepsi punted advertising at the 2010 Superbowl and diverted funds to supporting grants that would allow people to “refresh” their communities, for example, more public votes were cast for projects than had been cast in the 2008 election. Pepsi got buzz, and the company‘s in-house competition also offering a seed grant boosted employee morale.

Could this altruistic happiness principle be applied to one of our most disputed spheres — paying taxes? As it turns out, countries with more equal distributions of income also tend to be happier. And people in countries with more progressive taxation (such as Sweden and Japan) are more content than those in countries where taxes are less progressive (such as Italy and Singapore). One study indicated that people would be happier about paying taxes if they had more choice as to where their money went. Dunn and Norton thus suggest that if taxes were made to feel more like charitable contributions, people might be less resentful having to pay them.

The researchers persuasively suggest that the proclivity to derive joy from investing in others may well be just a fundamental component of human nature. Thus the typical ratio we all tend to fall into of spending on self versus others — ten to one — may need a shift. Giving generously to charities, friends, and coworkers — and even your country — may well be a productive means of increasing well-being and improving our lives.

Research selected by Francis Flynn, Paul E. Holden Professor of Organizational Behavior at Stanford Graduate School of Business.

For media inquiries, visit the Newsroom .

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A business journal from the Wharton School of the University of Pennsylvania

Does Money Buy Happiness? Here’s What the Research Says

March 28, 2023 • 5 min read.

Reconciling previously contradictory results, researchers from Wharton and Princeton find a steady association between larger incomes and greater happiness for most people but a rise and plateau for an unhappy minority.

• Finance & Accounting

The following article was originally published on Penn Today .

Does money buy happiness? Though it seems like a straightforward question, research had previously returned contradictory findings, leaving uncertainty about its answer.

Foundational work published in 2010 from Princeton University’s  Daniel Kahneman  and Angus Deaton had found that day-to-day happiness rose as annual income increased, but above $75,000 it leveled off and happiness plateaued. In contrast, work published in 2021 from the University of Pennsylvania’s  Matthew Killingsworth  found that happiness rose steadily with income well beyond $75,000, without evidence of a plateau.

To reconcile the differences, Kahneman and Killingsworth paired up in what’s known as an adversarial collaboration, joining forces with Penn Integrates Knowledge  University Professor  Barbara Mellers  as arbiter. In a new  Proceedings of the National Academy of Sciences  paper , the trio shows that, on average, larger incomes are associated with ever-increasing levels of happiness. Zoom in, however, and the relationship becomes more complex, revealing that within that overall trend, an unhappy cohort in each income group shows a sharp rise in happiness up to $100,000 annually and then plateaus.

“In the simplest terms, this suggests that for most people larger incomes are associated with greater happiness,” says Killingsworth, a senior fellow at Wharton and lead paper author. “The exception is people who are financially well-off but unhappy. For instance, if you’re rich and miserable, more money won’t help. For everyone else, more money was associated with higher happiness to somewhat varying degrees.”

Mellers digs into this last notion, noting that emotional well-being and income aren’t connected by a single relationship. “The function differs for people with different levels of emotional well-being,” she says. Specifically, for the least happy group, happiness rises with income until $100,000, then shows no further increase as income grows. For those in the middle range of emotional well-being, happiness increases linearly with income, and for the happiest group the association actually accelerates above $100,000.

Joining Forces to Ask: “Does Money Buy Happiness?”

The researchers began this combined effort recognizing that their previous work had drawn different conclusions. Kahneman’s 2010 study showed a flattening pattern where Killingsworth’s 2021 study did not. As its name suggests, an adversarial collaboration of this type — a notion originated by Kahneman — aims to solve scientific disputes or disagreements by bringing together the differing parties, along with a third-party mediator.

Killingsworth, Kahneman, and Mellers focused on a new hypothesis that both a happy majority and an unhappy minority exist. For the former, they surmised, happiness keeps rising as more money comes in; the latter’s happiness improves as income rises but only up to a certain income threshold, after which it progresses no further.

To test this new hypothesis, they looked for the flattening pattern in data from Killingworth’s study, which he had collected through an app he created called Track Your Happiness. Several times a day, the app pings participants at random moments, asking a variety of questions including how they feel on a scale from “very good” to “very bad.” Taking an average of the person’s happiness and income, Killingsworth draws conclusions about how the two variables are linked.

A breakthrough in the new partnership came early on when the researchers realized that the 2010 data, which had revealed the happiness plateau, had actually been measuring unhappiness in particular rather than happiness in general.

“It’s easiest to understand with an example,” Killingsworth says. Imagine a cognitive test for dementia that most healthy people pass easily. While such a test could detect the presence and severity of cognitive dysfunction, it wouldn’t reveal much about general intelligence since most healthy people would receive the same perfect score.

“In the same way, the 2010 data showing a plateau in happiness had mostly perfect scores, so it tells us about the trend in the unhappy end of the happiness distribution, rather than the trend of happiness in general. Once you recognize that, the two seemingly contradictory findings aren’t necessarily incompatible,” Killingsworth says. “And what we found bore out that possibility in an incredibly beautiful way. When we looked at the happiness trend for unhappy people in the 2021 data, we found exactly the same pattern as was found in 2010; happiness rises relatively steeply with income and then plateaus.”

“The two findings that seemed utterly contradictory actually result from data that are amazingly consistent,” he says.

Does It Matter Whether Money Can Buy Happiness?

Drawing these conclusions would have been challenging had the two research teams not come together, says Mellers, who suggests there’s no better way than adversarial collaborations to resolve scientific conflict.

“This kind of collaboration requires far greater self-discipline and precision in thought than the standard procedure,” she says. “Collaborating with an adversary — or even a non-adversary — is not easy, but both parties are likelier to recognize the limits of their claims.” Indeed, that’s what happened, leading to a better understanding of the relationship between money and happiness.

And these findings have real-world implications, according to Killingsworth. For one, they could inform thinking about tax rates or how to compensate employees. And, of course, they matter to individuals as they navigate career choices or weigh a larger income against other priorities in life, Killingsworth says.

However, he adds that for emotional well-being money isn’t the be all end all. “Money is just one of the many determinants of happiness,” he says. “Money is not the secret to happiness, but it can probably help a bit.”

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More Proof That Money Can Buy Happiness (or a Life with Less Stress)

When we wonder whether money can buy happiness, we may consider the luxuries it provides, like expensive dinners and lavish vacations. But cash is key in another important way: It helps people avoid many of the day-to-day hassles that cause stress, new research shows.

Money can provide calm and control, allowing us to buy our way out of unforeseen bumps in the road, whether it’s a small nuisance, like dodging a rainstorm by ordering up an Uber, or a bigger worry, like handling an unexpected hospital bill, says Harvard Business School professor Jon Jachimowicz.

“If we only focus on the happiness that money can bring, I think we are missing something,” says Jachimowicz, an assistant professor of business administration in the Organizational Behavior Unit at HBS. “We also need to think about all of the worries that it can free us from.”

The idea that money can reduce stress in everyday life and make people happier impacts not only the poor, but also more affluent Americans living at the edge of their means in a bumpy economy. Indeed, in 2019, one in every four Americans faced financial scarcity, according to the Board of Governors of the Federal Reserve System. The findings are particularly important now, as inflation eats into the ability of many Americans to afford basic necessities like food and gas, and COVID-19 continues to disrupt the job market.

Buying less stress

The inspiration for researching how money alleviates hardships came from advice that Jachimowicz’s father gave him. After years of living as a struggling graduate student, Jachimowicz received his appointment at HBS and the financial stability that came with it.

“My father said to me, ‘You are going to have to learn how to spend money to fix problems.’” The idea stuck with Jachimowicz, causing him to think differently about even the everyday misfortunes that we all face.

To test the relationship between cash and life satisfaction, Jachimowicz and his colleagues from the University of Southern California, Groningen University, and Columbia Business School conducted a series of experiments, which are outlined in a forthcoming paper in the journal Social Psychological and Personality Science , The Sharp Spikes of Poverty: Financial Scarcity Is Related to Higher Levels of Distress Intensity in Daily Life .

Higher income amounts to lower stress

In one study, 522 participants kept a diary for 30 days, tracking daily events and their emotional responses to them. Participants’ incomes in the previous year ranged from less than $10,000 to $150,000 or more. They found:

• Money reduces intense stress: There was no significant difference in how often the participants experienced distressing events—no matter their income, they recorded a similar number of daily frustrations. But those with higher incomes experienced less negative intensity from those events.
• More money brings greater control : Those with higher incomes felt they had more control over negative events and that control reduced their stress. People with ample incomes felt more agency to deal with whatever hassles may arise.
• Higher incomes lead to higher life satisfaction: People with higher incomes were generally more satisfied with their lives.

“It’s not that rich people don’t have problems,” Jachimowicz says, “but having money allows you to fix problems and resolve them more quickly.”

Why cash matters

In another study, researchers presented about 400 participants with daily dilemmas, like finding time to cook meals, getting around in an area with poor public transportation, or working from home among children in tight spaces. They then asked how participants would solve the problem, either using cash to resolve it, or asking friends and family for assistance. The results showed:

• People lean on family and friends regardless of income: Jachimowicz and his colleagues found that there was no difference in how often people suggested turning to friends and family for help—for example, by asking a friend for a ride or asking a family member to help with childcare or dinner.
• Cash is the answer for people with money: The higher a person’s income, however, the more likely they were to suggest money as a solution to a hassle, for example, by calling an Uber or ordering takeout.

While such results might be expected, Jachimowicz says, people may not consider the extent to which the daily hassles we all face create more stress for cash-strapped individuals—or the way a lack of cash may tax social relationships if people are always asking family and friends for help, rather than using their own money to solve a problem.

“The question is, when problems come your way, to what extent do you feel like you can deal with them, that you can walk through life and know everything is going to be OK,” Jachimowicz says.

Breaking the ‘shame spiral’

In another recent paper , Jachimowicz and colleagues found that people experiencing financial difficulties experience shame, which leads them to avoid dealing with their problems and often makes them worse. Such “shame spirals” stem from a perception that people are to blame for their own lack of money, rather than external environmental and societal factors, the research team says.

“We have normalized this idea that when you are poor, it’s your fault and so you should be ashamed of it,” Jachimowicz says. “At the same time, we’ve structured society in a way that makes it really hard on people who are poor.”

For example, Jachimowicz says, public transportation is often inaccessible and expensive, which affects people who can’t afford cars, and tardy policies at work often penalize people on the lowest end of the pay scale. Changing those deeply-engrained structures—and the way many of us think about financial difficulties—is crucial.

After all, society as a whole may feel the ripple effects of the financial hardships some people face, since financial strain is linked with lower job performance, problems with long-term decision-making, and difficulty with meaningful relationships, the research says. Ultimately, Jachimowicz hopes his work can prompt thinking about systemic change.

“People who are poor should feel like they have some control over their lives, too. Why is that a luxury we only afford to rich people?” Jachimowicz says. “We have to structure organizations and institutions to empower everyone.”

[Image: iStockphoto/mihtiander]

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Happiness Economics: Can Money Buy Happiness?

It only costs a small amount, a slight risk, with the possibility of a substantial reward.

But will it make you happy? Will it give you long-lasting happiness?

Undoubtedly, there will be a temporary peak in happiness, but will all your troubles finally fade away?

That is what we will investigate today. We explore the economics of happiness and whether money can buy happiness. In this post, we will start by broadly exploring the topic and then look at theories and substantive research findings. We’ll even have a look at previous lottery winners.

For interested readers, we will list interesting books and podcasts for further enjoyment and share a few of our own happiness resources.

Ka-ching: Let’s get rolling!

Before you continue, we thought you might like to download our three Happiness & Subjective Wellbeing Exercises for free . These detailed, science-based exercises will help you or your clients identify sources of authentic happiness and strategies to boost wellbeing.

This Article Contains

What is happiness economics, theory of the economics of happiness, can money buy happiness 5 research findings, 6 fascinating books and podcasts on the topic, resources from positivepsychology.com, a take-home message.

Happiness economics is a field of economics that recognizes happiness and wellbeing as important outcome measures, alongside measures typically used, such as employment, education, and health care.

Economics emphasizes how specific economic/financial characteristics affect our wellbeing (Easterlin, 2004).

For example, does employment result in better health and longer lifespan, among other metrics? Do people in wealthier countries have access to better education and longer life spans?

In the last few decades, there has been a shift in economics, where researchers have recognized the importance of the subjective rating of happiness as a valuable and desirable outcome that is significantly correlated with other important outcomes, such as health (Steptoe, 2019) and productivity (DiMaria et al., 2020).

Broadly, happiness is a psychological state of being, typically researched and defined using psychological methods. We often measure it using self-report measures rather than objective measures that are less vulnerable to misinterpretation and error.

Including happiness in economics has opened up an entirely new avenue of research to explore the relationship between happiness and money.

Andrew Clark (2018) illustrates the variability in the term happiness economics with the following examples:

• Happiness can be a predictor variable, influencing our decisions and behaviors.
• Happiness might be the desired outcome, so understanding how and why some people are happier than others is essential.

However, the connection between our behavior and happiness must be better understood. Even though “being happy” is a desired outcome, people still make decisions that prevent them from becoming happier. For example, why do we choose to work more if our work does not make us happier? Why are we unhappy even if our basic needs are met?

An example of how happiness can influence decision-making

Sometimes, we might choose not to maximize a monetary or financial gain but place importance on other, more subjective outcomes.

To illustrate: If faced with two jobs — one that pays well but will bring no joy and another that pays less but will bring much joy — some people would prefer to maximize their happiness over financial gain.

If this decision were evaluated using a utility framework where the only valued outcomes were practical, then the decision would seem irrational. However, this scenario suggests that psychological outcomes, such as the experience of happiness, are as crucial as other socio-economic outcomes.

Economists recognize that subjective wellbeing , or happiness, is an essential characteristic and sometimes a desirable outcome that can motivate our decision-making.

In the last few decades, economics has shifted to include happiness as a measurable and vital part of general wellbeing (Graham, 2005).

The consequence is that typical economic questions now also look at the impact of employment, finances, and other economic metrics on the subjective rating and experience of happiness at individual and country levels.

Happiness is such a vital outcome in society and economic activity that it must be involved in policy making. The subjective measure of happiness is as important as other typical measures used in economics.

Many factors can contribute to happiness. In this post, we consider the role of money. The relationship between happiness, or subjective wellbeing, and money is assumed to be positive: More money means greater happiness.

However, the relationship between money and happiness is paradoxical: More money does not guarantee happiness (for an excellent review, see Graham, 2005).

Specifically, low levels of income are correlated with unhappiness. However, as our individual wealth increases and our basic needs are met, our needs change and differ in their importance.

Initially, our happiness is affected by absolute levels of income, but at a certain threshold, we place importance on relative levels of income. Knowing how we rank and compare to other people, in terms of wealth and material possession, influences our happiness.

The relationship between wealth and happiness continues to increase, but only to a certain point; at this stage, more wealth does not guarantee more happiness (Easterlin, 1974; Diener et al., 1993).

This may be at odds with our everyday lived experience. Most of us choose to work longer hours or multiple jobs so that we make more money. However, what is the point of doing this if money does not increase our happiness? Why do we seem to think that more money will make us happier?

History of the economics of happiness

The relationship between economics and happiness originated in the early 1970s. Brickman and Campbell (1971, as cited in Brickman et al., 1978) first argued that the typical outcomes of a successful life, such as wealth or income, had no impact on individual wellbeing.

Easterlin (1974) expanded these results and showed that although wealthier people tend to be happier than poor people in the same country, the average happiness levels within a country remained unchanged even as the country’s overall wealth increased.

The inconsistent relationship between happiness and income and its sensitivity to critical income thresholds make this topic so interesting.

There is some evidence that wealthier countries are happier than others, but only when comparing the wealthy with the poor (Easterlin, 1974; Graham, 2005).

As countries become wealthier, citizens report higher happiness, but this relationship is strongest when the starting point is poverty. Above a certain income threshold, happiness no longer increases (Diener et al., 1993).

Interestingly, people tend to agree on the amount of money needed to make them happy; but beyond a certain value, there is little increase in happiness (Haesevoets et al., 2022).

Measurement challenges

Measuring happiness accurately and reliably is challenging. Researchers disagree on what happiness means.

It is not the norm in economics to measure happiness by directly asking a participant how happy they are; instead, happiness is inferred through:

• Subjective wellbeing (Clark, 2018; Easterlin, 2004)
• A combination of happiness and life satisfaction (Bruni, 2007)

Furthermore, happiness can refer to an acute psychological state, such as feeling happy after a nice meal, or a lasting state similar to contentment (Nettle, 2005).

Researchers might use different definitions of happiness and ways to measure it, thus leading to contradictory results. For example, happiness might be used synonymously with subjective wellbeing and can refer to several things, including life satisfaction and financial satisfaction (Diener & Oishi, 2000).

It seems contradictory that wealthier nations are not happier overall than poorer nations and that increasing the wealth of poorer nations does not guarantee that their happiness will increase too. What could then be done to increase happiness?

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What is the relationship between income/wealth and happiness? To answer that question, we looked at studies to see where and how money improves happiness, but we’ll also consider the limitations to the positive effect of income.

Money buys access; jobs boost happiness

Overwhelming evidence shows that wealth is correlated with measures of wellbeing.

Wealthier people have access to better healthcare, education, and employment, which in turn results in higher life satisfaction (Helliwell et al., 2012). A certain amount of wealth is needed to meet basic needs, and satisfying these needs improves happiness (Veenhoven & Ehrhardt, 1995).

Increasing happiness through improved quality of life is highest for poor households, but this is explained by the starting point. Access to essential services improves the quality of life, and in turn, this improves measures of wellbeing.

Most people gain wealth through employment; however, it is not just wealth that improves happiness; instead, employment itself has an important association with happiness. Happiness and employment are also significantly correlated with each other (Helliwell et al., 2021).

Lockdown on happiness

The World Happiness Report (Helliwell et al., 2021) reports that unemployment increased during the COVID-19 pandemic, and this was accompanied by a marked decline in happiness and optimism.

The pandemic also changed how we evaluated certain aspects of our lives; for example, the relationship between income and happiness declined. After all, what is the use of money if you can’t spend it? In contrast, the association between happiness and having a partner increased (Helliwell et al., 2021).

Wealthier states smile more, but is it real?

If we took a snapshot of happiness and a country’s wealth, we would find that richer countries tend to have happier populations than poorer countries.

For example, based on the 2021 World Happiness Report, the top five happiest countries — which are also wealthy countries — are Finland, Iceland, Denmark, Switzerland, and the Netherlands (Helliwell et al., 2021).

In contrast, the unhappiest countries are those that tend to be emerging markets or have a lower gross domestic product (GDP), e.g., Zimbabwe, Tanzania, and India (Graham, 2005; Helliwell et al., 2021).

At face value, this makes sense: Poorer countries most likely have other factors associated with them, e.g., higher unemployment, more crime, and less political stability. So, based on this cross-sectional data, a country’s wealth and happiness levels appear to be correlated. However, over a more extended period, the relationship between happiness and GDP is nil (Easterlin, 2004).

That is, the subjective wellbeing of a population does not increase as a country becomes richer. Even though the wealth of various countries worldwide has increased over time, the overall happiness levels have not increased similarly or have remained static (Kahneman et al., 2006). This is known as a happiness–income paradox.

Easterlin (2004) posits four explanations for this finding:

• Societal and individual gains associated with increased wealth are concentrated among the extremely wealthy.
• Our degree of happiness is informed by how we compare to other people, and this relative comparison does not change as country-wide wealth increases.
• Happiness is not limited to only wealth and financial status, but is affected by other societal and political factors, such as crime, education, and trust in the government.
• Long-term satisfaction and contentment differ from short-term, acute happiness.

Kahneman et al. (2006) provide an alternative explanation centered on the method typically used by researchers. Specifically, they argue that the order of the questions asked to measure happiness and how these questions are worded have a focusing effect. Through the question, the participant’s attention to their happiness is sharpened — like a lens in a camera — and their happiness needs to be over- or underestimated.

Kahneman et al. (2006) also point out that job advancements like a raise or a promotion are often accompanied by an increase in salary and work hours. Consequently, high-paying jobs often result in less leisure time available to spend with family or on hobbies and can cause more unhappiness.

Not all that glitters is gold

Extensive research explored whether a sudden financial windfall was associated with a spike in happiness (e.g., Sherman et al., 2020). The findings were mixed. Sometimes, having more money is associated with increased life satisfaction and improved physical and mental health.

This boost in happiness, however, is not guaranteed, nor is it long. Sometimes, individuals even wish it had never happened (Brickman et al., 1978; Sherman et al., 2020).

Consider lottery winners. These people win sizable sums of money — typically more extensive than a salary increase — large enough to impact their lives significantly. Despite this, research has consistently shown that although lottery winners report higher immediate, short-term happiness, they do not experience higher long-term happiness (Sherman et al., 2020).

Here are some reasons for this:

• Previous everyday activities and experiences become less enjoyable when compared to a unique, unusual experience like winning the lottery.
• People habituate to their new lifestyle.
• A sudden increase in wealth can disrupt social relationships among friends and family members.
• Work and hobbies typically give us small nuggets of joy over a more extended period (Csikszentmihalyi et al., 2005). These activities can lose their meaning over a longer period, resulting in more unhappiness (Sherman et al., 2020; Brickman et al., 1978).

Sherman et al. (2020) further argue that lottery winners who decide to quit their job after winning, but do not fill this newly available time with some type of meaningful hobby or interest, are also more likely to become unhappy.

Passive activities do not provide the same happiness as work or hobbies. Instead, if lottery winners continue to take part in activities that give them meaning and require active engagement, then they can avoid further unhappiness.

Happiness: Is it temperature or climate?

Like most psychological research, part of the challenge is clearly defining the topic of investigation — a task made more daunting when the topic falls within two very different fields.

Nettle (2005) describes happiness as a three-tiered concept, ranging from short-lived but intense on one end of the spectrum to more abstract and deep on the other.

The first tier refers to transitory feelings of joy, like when one opens up a birthday present.

The second tier describes judgments about feelings, such as feeling satisfied with your job. The third tier is more complex and refers to life satisfaction.

Across research, different definitions are used: Participants are asked about feelings of (immediate) joy, overall life satisfaction, moments of happiness or satisfaction, and mental wellbeing . The concepts are similar but not identical, thus influencing the results.

Most books on happiness economics are textbooks. Although no doubt very interesting, they’re not the easy-reading books we prefer to recommend.

Instead, below you will find a range of books written by economists that explore happiness. These should provide a good springboard on the overall topic of happiness and what influences it, in case any of our readers want to pick up a more in-depth textbook afterward.

If you have a happiness book you would recommend, please let us know in the comments section.

1. Happiness: Lessons from a New Science – Richard Layard

Richard Layard, a lead economist based in London, explores in his book if and how money can affect happiness.

Layard does an excellent job of introducing topics from various fields and framing them appropriately for the reader.

The book is aimed at readers from varying academic and professional backgrounds, so no experience is needed to enjoy it.

Find the book on Amazon .

2. Happiness by Design: Change What You Do, Not How You Think – Paul Dolan

This book has a more practical spin. The author explains how we can use existing research and theories to make small changes to increase our happiness.

Paul Dolan’s primary thesis is that practical things will have a bigger effect than abstract methods, and we should change our behavior rather than our thinking.

The book is a quick read (airport-perfect!), and Daniel Kahneman penned the foreword.

3. The Psychology of Money: Timeless Lessons on Wealth, Greed and Happiness – Morgan Housel

This book is not necessarily about happiness economics, but it is close enough to the overall theme that it is worth mentioning.

Since most people are concerned with making more money, this book helps teach the reader why we make the decisions we do and how we make better decisions about our money.

This book is a worthwhile addition to any bookcase if you are interested in the relationship between finances and psychology in general.

4. Happiness: The Science Behind Your Smile – Daniel Nettle

If you are interested in happiness overall, then we recommend Happiness: The Science Behind Your Smile by Daniel Nettle, a professor of behavioral science at Newcastle University.

In this book, he takes a scientific approach to explaining happiness, starting with an in-depth exploration of the definition of happiness and some of its challenges.

The research that he presents comes from various fields, including social sciences, medicine, neurobiology, and economics.

Because of its small size, this book is perfect for a weekend away or to read on a plane.

5 & 6. Prefer to listen rather than read?

One of our favorite podcasts is Intelligence2, where leading experts in a particular field gather to debate a particular topic.

This show’s host, Dr. Laurie Santos, argues that we can increase our happiness by not hoarding our money for ourselves but by giving it to others instead. If you are interested in this episode , or any of the other episodes in the Happiness Lab podcast series, then head on over to their page.

There are several resources available at PositivePsychology.com for our readers to use in their professional and personal development.

In this section, you’ll find a few that should supplement any work on happiness and economics. Since the undercurrent of the topic is whether happiness can be improved through wealth, a few resources look at happiness overall.

Valued Living Masterclass

Although knowledge is power, knowing that money does not guarantee happiness does not mean that clients will suddenly feel fulfilled and satisfied with their lives.

For this reason, we recommend the Valued Living Masterclass , for professionals to help their clients find meaning in their lives. Rather than keeping up with the Joneses or chasing a high-paying job, professionals can help their clients connect with their inner meaning (i.e., their why ) as a way to find meaning and gain happiness.

Three free exercises

If you want to try it out before committing, look at the Meaning & Valued Living exercise pack , which includes three exercises for free.

Recommended reading

Read our post on Success Versus Happiness for further information on balancing happiness with success, in any domain . This topic is poignant for readers who conflate happiness and success, and will guide readers to better understand their relationship and how the two terms influence each other.

For readers who wonder about altruism , you would find it interesting that rather than hoarding, you can increase your happiness through volunteering and donating. In this post, the author, Dr. Jeremy Sutton, does a fabulous job of approaching altruism from various fields and provides excellent resources for further reading and real-life application.

Our last recommendation is for readers who want to know more about measuring subjective wellbeing and happiness . The post lists various tests and apps that can measure happiness and the overall history of how happiness was measured and defined. This is a good starting point for researchers or clinicians who want to explore happiness economics professionally.

17 Happines Exercises

If you’re looking for more science-based ways to help others develop strategies to boost their wellbeing, this collection contains 17 validated happiness and wellbeing exercises . Use them to help others pursue authentic happiness and work toward a  life filled with purpose and meaning

17 Exercises To Increase Happiness and Wellbeing

Add these 17 Happiness & Subjective Well-Being Exercises [PDF] to your toolkit and help others experience greater purpose, meaning, and positive emotions.

Created by Experts. 100% Science-based.

As you’ve seen in our article, the evidence overwhelmingly clarifies that money does not guarantee more happiness … well, long-term happiness.

Our happiness is relative since we compare ourselves to other people, and over time, as we become accustomed to our wealth, we lose all the happiness gains we made.

Money can ease financial and social difficulties; consequently, it can drastically improve people’s living conditions, life expectancy, and education.

Improvements in these outcomes have a knock-on effect on the overall experience of one’s life and the opportunities for one’s family and children. Nevertheless, better opportunities do not guarantee happiness.

Our intention with this post was to illustrate some complexities surrounding the relationship between money and happiness.

Knowing that money does not guarantee happiness, we recommend less expensive methods to improve one’s happiness:

• Spend time with friends.
• Cultivate hobbies and interests.
• Stay active and eat healthy.
• Try to live a meaningful life.
• Give some love (go smooch your partner or tickle your dog’s belly).

Diamonds might be a girl’s best friend, but money is a fair weather one, at best.

We hope you enjoyed reading this article. Don’t forget to download our three Happiness Exercises for free .

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• Bruni, L. (2007). Handbook on the economics of happiness . Edward Elgar.
• Clark, A. E. (2018). Four decades of the economics of happiness: Where next? Review of Income and Wealth , 64 (2), 245–269.
• Csikszentmihalyi, M., Abuhamdeh, S., & Nakamura, J. (2005). Flow. In A. J. Elliot & C. S. Dweck (Eds.), Handbook of competence and motivation (pp. 598–608). Guilford Publications.
• Diener, E., Sandvik, E., Seidlitz, L., & Diener, M. (1993). The relationship between income and subjective well-being: Relative or absolute? Social Indicators Research , 28 , 195–223.
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• DiMaria, C. H., Peroni, C., & Sarracino, F. (2020). Happiness matters: Productivity gains from subjective well-being. Journal of Happiness Studies , 21 (1), 139–160.
• Easterlin, R. A. (1974). Does economic growth improve the human lot? Some empirical evidence. In P. A. David & M. W. Reder (Eds.), Nations and households in economic growth: Essays in honor of Moses Abramovitz (pp. 89–125). Academic Press.
• Easterlin, R. A. (2004). The economics of happiness. Daedalus , 133 (2), 26–33.
• Graham, C. (2005). The economics of happiness. World Economics , 6 (3), 41–55.
• Haesevoets, T., Dierckx, K., & Van Hiel, A. (2022). Do people believe that you can have too much money? The relationship between hypothetical lottery wins and expected happiness. Judgment and Decision Making , 17 (6), 1229–1254.
• Helliwell, J., Layard, R., & Sachs, J. (Eds.) (2012). World happiness report . The Earth Institute, Columbia University.
• Helliwell, J. F., Layard, R., Sachs, J. D., & Neve, J. E. D. (2021). World happiness report 2021 .
• Kahneman, D., Krueger, A. B., Schkade, D., Schwarz, N., & Stone, A. A. (2006). Would you be happier if you were richer? A focusing illusion. Science , 312 (5782), 1908–1910.
• Nettle, D. (2005). Happiness: The science behind your smile . Oxford University Press.
• Sherman, A., Shavit, T., & Barokas, G. (2020). A dynamic model on happiness and exogenous wealth shock: The case of lottery winners. Journal of Happiness Studies , 21 , 117–137.
• Steptoe, A. (2019). Happiness and health. Annual Review of Public Health , 40 , 339–359.
• Veenhoven, R., & Ehrhardt, J. (1995). The cross-national pattern of happiness: Test of predictions implied in three theories of happiness. Social Indicators Research , 34 , 33–68.

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Money, Happiness and Relationship Between Them Essay

Wealthy and poor can be equally unhappy, money cannot buy health, love, and friendship, earning money takes all of your time, money allows you to have what you want, money increases confidence, financial stability can consolidate the marriage, money can only buy happiness up to a certain point.

The research conducted in the different countries during which people were asked how satisfied they were with their lives clearly indicated the existence of a non-linear relationship between the amount of money and the size of happiness; if the money allows you to get out of the dire straits and enjoy the comfort of the middle class, it is possible that you will be happier; but it is unlikely you will experience something like this when there are millions and tens of millions dollars on your account.

Upon getting used to the money, wealthy people take it for granted; acquisition of goods does not bring as much content as it did, while the abundance of choices becomes tiresome. In this case, the amount of money does not affect the enjoyment of life; the general content with life depends on the various factors, such as health, family, the ability to take pleasure in ordinary activities, and so on. Although money can spare people from many problems, it cannot buy happiness.

Money itself is not able to make someone happy or unhappy. Monetary means only afford the opportunities, and these opportunities allow us to build the life that we want. Nevertheless, happiness is an inner state, and it does not depend on material wealth. One can be happy both with money and without it. Wealth itself is not able to bring happiness into your life; neither can poverty.

Although money allows purchasing medications and high-quality health services, it cannot buy health. Buying a comfortable bed will not buy healthy sleep. By paying money to a person, you will get an employee, but you cannot pay someone to be your friend. A big bright house can be bought, but the warmth of the family and the domestic hearth cannot.

People from wealthy families can graduate from any educational institution, even the most prestigious ones, but they cannot buy intelligence. With the money, you can have access to a variety of activities, but you cannot buy friendship and love. To summarize, “the consumption of durables, charity, personal care, food, health care, vehicles, and housing is not significantly associated with happiness” (DeLeire & Kalil, 2010).

Since money is time, wealthy people usually are quite busy. They spend all of their time working or supervising the work of their employees. Due to such a lifestyle, many of them do not have a family. If they are lucky to acquire one, it is very likely they will not have enough time to spend with their spouses and children.

The material benefits cannot be compared with the neglection the children experience when spending time with their nannies and private tutors instead of their parents. To justify themselves, parents tend to buy off with expensive toys and gadgets. Instead of family celebrations, trips to the country, and time happily spent together, and the children get new phones, tablet PCs, and branded clothing.

From the side, it may look like happiness, but the child, no matter how contemporary and tech-savvy he/she was, would be much happier taking a walk in the park with its parents. According to most economists, in order to be successful in the future, the children’s human capital requires the investment of both money and time (Mayer, 1997).

Money is a means with which people can afford high-quality food, medical care, as well as gym and fitness club membership. All of this helps them maintain their physical health. At the availability of funds, individuals can evolve intellectually, buy the necessary books, and earn a degree in the best universities around the world. With the necessary funds, people have the opportunity to travel, visit any places on the planet, get inspired, and develop the way they wish.

Money helps stimulate emotions that lead to positive results. For example, new clothes often make people more confident. The acquired self-confidence can help get the desired position, make a good bargain, or just add a little bit of abandon to your manner of walking. Money can buy fresh impressions and equipment, one’s favorite hobby.

Because of this, an individual develops his/her creativity and achieves balance. For those who are concerned about security, the availability of money on the bank account helps to gain confidence in the future, because these funds can be used to cover the unexpected expenses such as car repairs or an emergency medical care for a family member.

There are various examples when financial problems destroy the family. This statement was once again confirmed by Jeffrey Dew in his 2009 work, where he showed the relationship between financial problems and divorce. According to Dew’s research, couples with no assets were about 70 percent more likely to divorce over a three-year period compared to couples with assets of $10,000 (Dew, 2009).

What is more, being single and not having a partner casts many people down and drives them to despair; needless to say, a comfortable partnership becomes a source of happiness. In this case, money plays an important role in creating and maintaining good relations in marriage while minimizing stress. One can afford to hire a nanny, a charwoman, or other household staff in order to spend more time with the family and avoid being distracted by minor issues.

Despite this, one cannot just buy happiness itself. The work of Angus Deaton, the expert at Princeton University, and Daniel Kahneman showed that despite the fact that rich people have a more positive attitude to their life, there is no direct relationship between wealth and the emotional state of contentment (Kahneman & Deaton, 2010).

In addition, they found that the more significant performance measures of daily emotions are health, loneliness, smoking, but not money. The researchers argue that money can buy satisfaction but not happiness; however, the lack of sufficient funds has a negative influence on both.

Despite the fact that in the majority of cases, people associate happiness with material prosperity, it is the satisfaction with the financial situation, rather than happiness, that they feel. Although money has the capability of increasing one’s confidence, consolidating the matrimony as a result of financial stability and providing various opportunities for the development, it cannot buy true love, health, friendship, and faith of the people.

Sometimes, earning money may take all of one’s time, preventing the individual from building a relationship or spending time with its family and friends. In addition, money is not a guarantee of happiness, since people both with low and high income may be equally happy or unhappy.

DeLeire, T., & Kalil, A. (2010). Does consumption buy happiness? Evidence from the United States. International Review Of Economics , 57 (2), 163-176. Web.

Dew, J. (2009). Bank on It: Thrifty Couples are the Happiest . Web.

Kahneman, D., & Deaton, A. (2010). High income improves evaluation of life but not emotional well-being. Proceedings Of The National Academy Of Sciences , 107 (38), 16489-16493. Web.

Mayer, S. (1997). What Money Can’t Buy . Cambridge, Mass.: Harvard University Press.

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Sample essay: does money bring happiness?

by Manjusha Nambiar · Published April 7, 2014 · Updated November 14, 2023

IELTS essay prompt

Some people believe that money brings happiness; others are of the opinion that having too much money is a problem. Discuss both views and give your own opinion.

Sample response

Almost all of us are motivated by money. The only reason that most of us spend 8 to 10 hours at the workplace is to earn money. Money probably doesn’t bring happiness, but not having enough money to take care of our basic needs will seriously limit our happiness. No one wants to live in poverty and no one will lend to the poor.

Money helps us lead a comfortable life. It helps us provide the best possible education for our children. It ensures that our near and dear ones have access to medical attention whenever they need it.

Having more money than you need is unlikely to increase your levels of happiness, but not having enough will definitely destroy your peace of mind.

There is a limit to the amount of money that we can spend on ourselves. Still, the richest among us have amassed wealth they or their progeny will never use in their lifetime. Still, they aren’t satisfied. They want more. That is the lure of money. It never makes people content. Those who don’t have it want to have it. Those who have it want to have even more of it. Unfortunately, in our pursuit of riches, we often forget to live. We forget to appreciate the little joys that make our lives worth living.

Having a lot of money is definitely a problem. It even threatens our safety and security and makes us the target of thieves. Look at the richest people. They can’t move around freely like you or I. They are always surrounded by their personal security guards and often live their entire lives in constant fear of getting attacked.

To conclude, money is unlikely to make us happy, but we must still earn enough. However, in our pursuit of riches, we must not lose our souls. True happiness comes from spiritual awakening. Money has hardly anything to do with it.

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Essay on Money and Happiness

Introduction

Money is an aspect that determines one’s happiness in different circumstances, depending on what it does to one. The wellbeing of an individual is typically associated with his/her happiness. Money is a means of exchange and can be used to make individuals happy upon expenditure (Yıldız, 2016). For instance, one can use money to raise his/her standards of living to a level that satisfies them. Various communities in the world have different lifestyles that are adored by most members of the society. It is essential to examine the relationship between money and happiness among members of the society. Money makes life easy by providing basics that are important for happiness and satisfaction (Yıldız, 2016). For instance, one can use money to buy medicine, educate people, and even create a serene environment for relaxation. Such aspects make money have an attachment to happiness. However, it is not necessarily true that money brings joy in an individual as it leads to crime and insecurity.

Problem Statement

Happiness is essential even amongst employees of any company as it can ensure the retention of top skilled staff. In most situations, when people are accorded high pay and other monetary related rewards, they tend to do better in their operations. Equally, individuals living in abject poverty might lack the necessary resources to obtain basics that are meant for survival. As for the rich, one can buy anything that makes them happy at whatever price (D’Ambrosio, Jäntti & Lepinteur, 2019). The fact that money evokes a spirit of happiness in many individuals is true even though it makes some to cry in the end. The study explores the role of money in making people happy or sad in life. It is also important to note that some people re happy even though they do not have much money or richness with them.

Happiness implies a situation where one’s life is good and that the individuals are comfortable with the state of life. Materialistic aspects within the society support happiness, and money is one significant material factor. It is through money that families go on holiday to have fun with their loved ones (D’Ambrosio, Jäntti & Lepinteur, 2019). People within the society have different perceptions of money and what it does to make one happy. A background check on the topic of discussion will be necessary to establish facts that other researchers have presented in regards to money and happiness.

The study seeks to explore the role of money in boosting happiness within the society.

Supporting Evidence

Money makes life comfortable when spending fits one’s personality according to research conducted by Matz, Gladstone, and Stillwell. In the year 2016, the research echoed the role of money in providing the necessary support in life to make one happy. Money buys food for everyone, and lack of enough of it can make one go hungry (Matz, Gladstone & Stillwell, 2016). For instance, some individuals suffer from conditions that require the taking of specified meals. Such meals are expensive, making it hard for many people to manage without enough money. Most people who live in poverty cannot finance healthy meals three times a day. Eating a meal of choice is essential to each individual within the society, which is a source of happiness. Money has a close relationship with happiness as it provides meals of choice (Muresan, Ciumas & Achim, 2019). When one wants to take a specific meal, they can purchase the food by using money. Money is an essential element for nurturing a well-fed and happy society.

The second aspect that makes money important in creating happiness is the fact that it can deliver a serene environment. With money, an individual creates and modifies the environment to suit preferences and tastes. Hotels and resorts make money from creating cool environments for vacation and relaxing (Mogilner & Norton, 2016). Such environments are expensive and meant for the rich in society, creating a notion that money is the sole source of happiness. Spending the right way during vacation is a source of happiness for many, making money a significant factor for anyone on holiday. A serene environment allows one to relax and reflect on personal issues that are affecting one’s life. Equally, money enables one to construct a self-contained homestead with the features of preference put in place. Money is an essential aspect as it enables one to purchase construction materials for the building of a home (Mogilner & Norton, 2016). Individuals with enough of the resources end up constructing beautiful homes that spark a feeling of happiness among the residents.

Some diseases require money to heal as the medicine involved is expensive. Chronic diseases are expensive to handle, and the vulnerable in society might not be in a position to handle outbreaks due to the expensive procedures involved (Mogilner & Norton, 2016). For instance, cancer is an issue that has plagued many poor societies as the drugs for treatment are expensive for the poor. As such, with a limited amount of money, one might fail to access the necessary care meant to cure a specific condition. In the event, family members are denied happiness as such cases end up fatal (Bartolini, Mikucka & Sarracino, 2017). Money is a critical aspect that can help fight deadly diseases, especially when the therapy involved and drugs are expensive. When n individual lacks enough resources to go for medical care, there is a likelihood that they will pass on, which deprives family members of their happiness (Bartolini, Mikucka & Sarracino, 2017). It is important to examine the role of money in helping fight chronic diseases and other deadly outbreaks within the society.

Money has promoted education and civilization in various societies on a global front. It is through money that one can access quality education to transform the society. People from poor backgrounds are disadvantaged for the lack of enough resources to provide the required education. The rich have the opportunity to educate their children in international institutions that nurture talent and professionalism (Bartolini, Mikucka & Sarracino, 2017). The poor do not get the opportunity to quality education, a factor widening the rift between the rich and the poor. Through quality education, an individual gains satisfaction, which is a prerequisite for happiness among many.

Refuting Argument

Money is not the source of happiness in the world s some could argue. This is because money has made many lose their lives in the event of looking for money. The existence of the rich and the poor within the society is an indication that money is not everything. Crime cases have gone up due to the love of money. Happiness can arise from within, and one does not have to be rich to enjoy life (Muresan, Ciumas & Achim, 2019). The love for money has made many people commit crimes in the name of searching for money. As such, one can presume that money is the source of the high crime rates experienced in many countries. Criminals cannot stop at anything until they obtain money illegally from an individual. Happiness can be obtained through inner satisfaction on various matters(Muresan, Ciumas & Achim, 2019)It does not have to be money that is used to make one comfortable.

The love for money has escalated to another level to the extent of a society losing its morality. People are concerned with looking for money as a source of happiness, even though they end up being frustrated. There are many individuals across the world with purchasing power, however, the money does not deliver the desired happiness. The society has lost moral standards due to the increased evils associated with money (Muresan, Ciumas & Achim, 2019). People go as far as killing for money, a factor that depicts the society as eroded with ethical values. Money has led to the erosion of humanity, which has bred hatred and unwanted conflicts within the society. Money should not be seen as the source of happiness but can be used to make one comfortable.

To sum it up, money and happiness are two aspects that are interrelated as one provides more comfort. It is important to examine various ways that many can create happiness within an individual. Money enables individuals to buy food, accommodation, drugs, and fund educational activities within the society. In the event, one meets his/her needs using money, which is a significant factor in sparkling happiness. However, the love of money has been the source of all evil, including crime, corruption, and embezzlement of funds. Money sparks happiness but does not guarantee happiness for anyone within the society.

Bartolini, S., Mikucka, M., & Sarracino, F. (2017). Money, trust and happiness in transition countries: evidence from time series.  Social indicators research ,  130 (1), 87-106.

D’Ambrosio, C., Jäntti, M., & Lepinteur, A. (2019). Money and Happiness: Income, Wealth and Subjective Well-being.  Social Indicators Research , 1-20.

Matz, S. C., Gladstone, J. J., & Stillwell, D. (2016). Money buys happiness when spending fits our personality.  Psychological science ,  27 (5), 715-725.

Mogilner, C., & Norton, M. I. (2016). Time, money, and happiness.  Current Opinion in Psychology ,  10 , 12-16.

Muresan, G. M., Ciumas, C., & Achim, M. V. (2019). Can money buy happiness? Evidence for European Countries.  Applied Research in Quality of Life , 1-18.

Yıldız, H. (2016). The Relation between Money and Happiness in MENA Countries. In  Comparative Political and Economic Perspectives on the MENA Region  (pp. 111-124). IGI Global.

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Home — Essay Samples — Literature — Money and Class in America — The Importance of Saving Money

The Importance of Saving Money

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Essay on Can Money Buy Happiness

Students are often asked to write an essay on Can Money Buy Happiness in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on Can Money Buy Happiness

Introduction.

Money is essential in life, but can it buy happiness? This question has sparked debates worldwide.

Money and Materialistic Joy

Money can buy materialistic things that bring joy. For example, your favorite video game or a bicycle can make you happy, and you need money for them.

Money and Freedom

Money can provide freedom to explore hobbies, travel, and experience new things, which can lead to happiness.

Limitations of Money

However, money can’t buy love, friendship, health, or peace of mind, which are essential for true happiness.

In conclusion, while money can buy temporary joy, it can’t buy lasting happiness.

250 Words Essay on Can Money Buy Happiness

The age-old question, “Can money buy happiness?” has sparked countless debates among philosophers, economists, and psychologists. While some argue that wealth is a key contributor to happiness, others believe that happiness lies in intangible aspects of life.

The Power of Wealth

Money, undeniably, holds power. It provides the ability to afford basic necessities, luxuries, and experiences. It can help in eliminating stressors like debt and financial instability, which are often associated with unhappiness. From a utilitarian perspective, money can indeed buy happiness as it facilitates access to goods and services that can improve quality of life.

The Limitations of Money

However, the relationship between money and happiness is not linear. Beyond a certain income level, additional wealth does not equate to increased happiness. This is known as the ‘Easterlin Paradox’. Also, an overemphasis on wealth can lead to materialism, which has been linked to decreased well-being and increased mental health issues.

The Role of Intangible Aspects

While money can provide comfort and security, it cannot buy intangible aspects such as love, friendship, health, or peace of mind. These aspects, according to many psychologists, are the true essence of happiness. They provide a sense of belonging, purpose, and contentment that money cannot procure.

In conclusion, money can buy temporary happiness by providing comfort, security, and experiences. However, it falls short in procuring lasting happiness that is often found in intangible aspects of life. Thus, the pursuit of wealth should be balanced with the pursuit of intangible aspects to achieve holistic happiness.

500 Words Essay on Can Money Buy Happiness

The question, “Can money buy happiness?” is a popular one. Many people think that having more money means being happier. But is that really true? Let’s explore this idea in a simple way.

Money and Basic Needs

Firstly, money is important because it helps us meet our basic needs. It allows us to buy food, clothes, and a place to live. Without money, we would struggle to survive. In this way, money can bring a certain level of happiness. It provides comfort and security, which are key to feeling satisfied in life.

Money and Material Possessions

Secondly, money can buy material things. This includes toys, gadgets, cars, or even vacations. These things can make us feel happy for a while. But after some time, the excitement fades. We start to want newer, better things. This is called the “hedonic treadmill.” It means that buying stuff only brings short-term happiness. Over time, we get used to what we have and want more.

Money and Relationships

Thirdly, let’s consider money and relationships. Money can help us do nice things for others. We can buy gifts for friends or donate to those in need. This can make us feel good about ourselves. But, money can’t buy true friendship or love. These are based on trust, understanding, and shared experiences. They can’t be bought with money.

Money and Happiness: The Real Picture

So, can money buy happiness? The answer is not straightforward. Money can buy things that make life more comfortable and enjoyable. But it can’t buy everything. It can’t buy love, good health, time, or peace of mind. These things are often the most important for true happiness.

Research shows that after a certain income level, more money doesn’t equal more happiness. This level is enough to meet basic needs and some wants. Beyond that, more money might not make a big difference in how happy you are.

In conclusion, money can buy some forms of happiness, but not all. It’s important to remember that the best things in life aren’t things. They are experiences, relationships, and good health. These can’t be bought with money. So, while money is important, it’s not the only path to happiness. It’s just one piece of the puzzle.

Remember, happiness comes from within. It’s about being content with what you have, not what you don’t have. It’s about enjoying the simple things in life. And most importantly, it’s about being true to yourself and your values.

That’s it! I hope the essay helped you.

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I’m a psychologist in Finland, the No. 1 happiest country in the world: 4 phrases we use every day

For the last six years, Finland has been ranked the happiest country in the world . I've lived here most of my life, and as a psychologist and happiness researcher , I'm often asked: what exactly makes people in Finland so satisfied with their lives?

You may be surprised to learn that Finnish people are often the first to question this characterization. Our national self-image is that we're quiet, introverted and somewhat melancholy types. This doesn't exactly align with being the happiest people on earth .

However, research has shown that those most desperately seeking happiness tend to be less happy. So if true happiness is best achieved indirectly, without paying too much attention to it, that is something Finnish people excel at.

A big part of our satisfaction stems from how the country's institutions care for its citizens . But our culture and values also play a key role in how we approach life and think about happiness. It is evident in these four phrases we use all the time. 

1. 'Who has happiness should hide it'

In Finland, we tend to believe that if you've found happiness, you shouldn't show it. Arguably, this is a strange expression. Why should you hide your smile when the world treats you well?

This saying, coined by Finland's national poet Eino Leino , stems from the modest national temperament. Overt displays of wealth and success are shunned here.

For example, in Helsinki, the capital, you will rarely see fancy or expensive cars on the streets. Even the CEOs and financial sharks here tend to drive boring Volvos and Volkswagens rather than anything that would make them stick out.

It's human nature to compare ourselves to others, which often has a negative effect on our happiness. However, in Finland and other Nordic countries, people tend to be more oblivious to those comparisons — and more content.

2. 'The pessimist will never be disappointed'

This is an old Finnish saying without any clear origin. It's always just been a cultural constant. 

We believe that setbacks are a fact of life. You will experience pain, disappointment and even tragedy. This isn't something we're frightened of because we know we have the tools we need to emotionally weather these challenges. 

One of my favorite philosophers is Charles Peirce . He was an American, but his philosophy of "meliorism," — essentially that things are neither the worst or the best but always "capable of improvement" — is an attitude that many Finnish people, myself included, share. 

Whatever your situation, there is always something that can be made better. Accepting these inevitable struggles, while focusing on what is still in your hands and can be improved, will keep you active and energized even during tough times.

3. 'Everyone is the blacksmith of their own happiness'

This is a saying that has roots in ancient Rome — "Faber est suae quisque fortunae" — but has long been quite popular in Finland. It reminds us that we all have to forge our own happiness. It will not be given to us on a silver platter. 

While everyone must take responsibility for their own life, research shows that who we are , what we can accomplish in life and our happiness is often the sum of the people around us. How much support we get often determines where we end up in life.

With that in mind, I prefer a modified version of this phrase: "Everyone is the center forward of their own happiness." 

In ice-hockey, one of Finland's most popular sports, if you are playing center, you have to put in the work to try to score. However, if your wingers and defenders don't pass the puck to you, you will be left alone. We need both our own effort and the support of our community to succeed.

4. 'Some have happiness, everyone has summer'

This is another beloved Finnish expression that has been handed down for over 100 years.

Most Finnish people understand that while there are aspects of our lives we can influence or change, there are so many things we simply can't control. So there is no point in envying those who are happy right now, even if we are struggling.

Sometimes life gives, sometimes it takes. Tomorrow someone else might be the one having a rough time, while something delightful comes your way.

We Finns know that, no matter the situation, you can always count on one thing: sooner or later, summer will come to us all.

Frank Martela , PhD, is a Finnish philosopher and psychology researcher who studies the fundamentals of happiness.   He is an assistant professor at Aalto University in Finland and the author of " A Wonderful Life: Insights on Finding a Meaningful Existence ." Follow him @frankmartela .

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