Can money buy happiness? Since the invention of money, or nearly enough, people have been telling one another that it can’t. Philosophers and gurus, holy books and self-help manuals have all warned of the futility of equating material gain with true well-being.
Modern research generally backs them up. Psychologists and economists have found that while money does matter to your sense of happiness, it doesn’t matter that much. Beyond the point at which people have enough to comfortably feed, clothe, and house themselves, having more money - even a lot more money - makes them only a little bit happier. So there’s quantitative proof for the preachings of St. Francis and the wisdom of the Buddha. Bad news for hard-charging bankers; good news for struggling musicians.
But starting to emerge now is a different answer to that age-old question. A few researchers are looking again at whether happiness can be bought, and they are discovering that quite possibly it can - it’s just that some strategies are a lot better than others. Taking a friend to lunch, it turns out, makes us happier than buying a new outfit. Splurging on a vacation makes us happy in a way that splurging on a car may not.
“Just because money doesn’t buy happiness doesn’t mean money cannot buy happiness,” says Elizabeth Dunn, a social psychologist and assistant professor at the University of British Columbia. “People just might be using it wrong.”
Dunn and others are beginning to offer an intriguing explanation for the poor wealth-to-happiness exchange rate: The problem isn’t money, it’s us. For deep-seated psychological reasons, when it comes to spending money, we tend to value goods over experiences, ourselves over others, things over people. When it comes to happiness, none of these decisions are right: The spending that make us happy, it turns out, is often spending where the money vanishes and leaves something ineffable in its place…