Thu, 28 Feb, 2019
How money can put happiness on lay-by
The fact that that money can’t buy you happiness is generally well accepted. Happiness, it appears, is more about meaning and satisfaction than the acquisition of more stuff.
But money isn’t all bad. It can feed your family and pay off your mortgage, so it has its upsides.
Reflecting this reality, research consistently demonstrates a non-linear relationship between money and happiness. It shows that those of us who earn too little are unhappy, but so are those of us who earn too much.
The most up-to-date figures on this relationship suggest that, in Australia, A$100,000 is the income “sweet spot” for maximising happiness.
So, money in moderation appears to promote the most happiness. Still, perhaps it’s not just how much money we have, but also how we value and spend it that matters for happiness.
The pursuit of happiness
It is now well accepted that materialism – the love of things – tends to have adverse consequences for well-being.
People who hold these values tend to be less happy, depressed and less satisfied with their lives. This fact is best remembered when sitting at the traffic lights in your Toyota Corolla next to a much younger person driving a rather swish looking Mercedes sports convertible.
We also know that what people spend their money on is an important determinant of happiness. Money tends to reduce happiness when it is spent on more stuff for ourselves.
But money can bring happiness when we spend it on experiences rather than things, use the money to benefit others, and perhaps unsurprisingly, don’t waste it on insurance policies.
When we spend money in less materialistic ways, it may actually promote eudaimonia - a sense of well-being and the feeling of flourishing and excelling in life.
But is there any hope for those poor materialists? A recently published study suggests there may be.
Wanting vs. having
Marsha Richins of the University of Missouri examined whether buying things may actually promote happiness.
In three studies, consumers were asked about the emotions they experienced when contemplating an important purchase, while shopping for an important purchase, or when using the product after it was purchased.
After grouping the sample according to whether consumers reported either high or low levels of materialism, Richins found materialists experienced more positive emotion when contemplating a future purchase, and a decline in positive emotion after the purchase had occurred.
Richins also found that the experience of positive emotion when contemplating a new purchase was related to how transformative materialists thought the new purchase would be.
That is, whether they thought the product would make them more likeable, more attractive and closer to their friends. Whether it would mean that they would have more fun and enjoyment in life, and would they be more effective and efficient in their lives.
This experience of pre-purchase increases and post-purchase decreases in positive emotion was not evident for lesser materialists, who appear to be emotionally ambivalent about acquiring more stuff.
The findings of this research demonstrate that, for materialists, happiness lies in the anticipation, rather than the outcome of spending money on things.
Maximising return on investment
How can we use this to improve our daily levels of happiness? Here are a few pearls of wisdom (well, at least, for the materialists among us):
1) Don’t rush into a purchase. Spend time contemplating how much of a better person the new product will make you first.
2) Buy lotto tickets a week before the draw. That’s seven days of happy expectation and probably the only return on investment you will ever receive!
3) Revive the lay-by. Putting something behind the counter and paying it off over time should maximise its happiness pay-offs.
4) Don’t buy now and pay later. It will not only contribute to the pain of debt, but will rob you of the joy of contemplating the purchase while you diligently save for it.
Can money buy happiness? Well, maybe it can.
If we don’t have too much of it, spend it on a good meal out or presents for our loved ones, and spend more time contemplating our purchases than shopping for them, we just may be able to maximise the happiness returns on our investments.
Written by Brock Bastian, Postdoctoral Fellow, School of Psychology, The University of Queensland. Republished with permission of The Conversation.