Taken at face value, it might be misinterpreted to say that money itself can make someone happy. This is something that some people might believe, and many others might not. Hopefully, we can all agree that there is much more to life than money!
So, can more money lead to more happiness? It seems popular or at least commonplace to downplay money’s influence on happiness. It’s an oft-discussed topic, but I haven’t really talked about my thoughts on this too much here. So let’s do it now.
Depending on how one views this topic, I say YES. More money can lead to more happiness. There might be studies out there saying at a certain income level, the impact of more money levels off. While that may be true, I wonder how things would look if you controlled for all variables when making such an assessment. Does more money cause people to voluntarily bring on additional stressors into their lives, thus decreasing the extra enjoyment that should have accrued from more money?
Let’s say that a person is making $50,000 per year. Based on that income, it allows for a certain lifestyle which includes aspects such as home, car, entertainment, and so on. Plus, of course, a certain level of potential savings.
Then, let’s pretend that this person got a sudden raise which doubled his salary. Now, he is making $100,000. Wouldn’t this make him happier?
I would think so. With more money, you have more options and more of a buffer in case something goes wrong. You can also, potentially, do more than obtain the basics in life. Rather, you can start living with some nice things. Not just material, but also health care and other things.
Now, let’s say that this person double his income again, going up to $200,000. Assuming the same purchasing power of the dollar, this person has a lot more at his disposal now. I would think life would become less stressful at this point.
So, with more money, a person would have the opportunity to:
- Save more money, which allows him to :
- Save more for retirement
- Have more of a buffer/emergency fund
- Feel less stressed about expenses
- Be closer to financial independence
- Spend more money on improving his life, including:
- Having money for procedures, and not bypassing them due to lack of money
- Investing in better (healthier) food and gyms/fitness equipment
- Invest in better – or additional – education and other learning opportunities
- Provide more help to others
- Assist kids with their college education expenses
- Provide their kids with better enrichment and extracurricular activities
- Help aging parents who might truly been in need, and lacking resources
- Give money to help others in need, or perhaps give to their religious affiliation
And yes, there are other fun things people can do as well. Perhaps take some nicer vacations, live in a more comfortable/geographically convenient home, and so one.
Ultimately, I think the key is not taking on additional liabilities, or expanding one’s perception of needs vs. wants. If someone can keep a good head on his or her shoulder, and be mature, it stands to reason that money can make one’s life better. Wouldn’t better educational opportunities, better health, and more ability to help others lead to some increased happiness for a lot of people? I think health, wealth, and relationships can all influence one another.
Of course one does not need to be rich to be happy. We are often as happy as we choose to be in any given moment; at least I see it that way. Nevertheless, it could only help to have more money than less for the aforementioned reasons.
My Questions for You
What do you think?
All things being equal, do you think more money can lead to more happiness?