Does Money Buy Happiness? New Research Says Maybe

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The common scientific answer to the question, does money buy happiness, has been no. Study after study has shown that once your basic needs are met and you are not living in poverty, more money does not make you happier. Doctors Norton (Harvard Business School), Dunn and Aknin (both at University of British Columbia) wondered if the issue was not that money couldn't buy happiness but that people simply weren't spending it in the right way to make themselves happier.

Prosocial Spending
They conducted three different studies that explored whether prosocial spending, that is giving gifts to charities or friends, would increase happiness where spending on selfish interests did not. First, they surveyed more than 600 Americans and found that spending more on gifts and charity correlated with greater happiness, whereas spending more money on oneself did not. Next, they tracked 16 workers before and after they received profit-sharing bonuses and found that that the workers who gave more of the money to others ended up happier than the ones who spent more of it on themselves. In fact, how the bonus was spent was a better predictor of happiness than the size of the bonus. Finally, they gave 46 students $5 or $20 to spend by the end of the day. The ones who were instructed to spend the money on others were happier at the end of the day than the ones who were instructed to spend the money on themselves.

"These experimental results," the researchers conclude, "provide direct support for our causal argument that spending money on others promotes happiness more than spending money on oneself." They also conclude that "how people choose to spend their money is at least as important as how much money they make."

All Charitable Giving Makes You Happier
According to the Social Capital Community Benchmark Survey, a survey of 30,000 American households, people who gave money to charity in 2000 were 43% more likely than non-givers to say they were "very happy" about their lives. It didn't matter whether gifts of money and time went to churches or symphony orchestras - givers to all types of religious and secular causes were far happier than non-givers.

Giving to Charity Gives Hope
People who give also are less sad and depressed than non-givers. The University of Michigan's Panel Study of Income Dynamics reveals that people who gave money away in 2001 were 34% less likely than non-givers to say that they had felt "so sad that nothing could cheer them up" in the past month. They were also 68% less likely to have felt "hopeless," and 24% less likely to have said that "everything was an effort."

Does money buy happiness? Yes money spent on helping others does buy happiness according to how to be happy research. Spread your happiness and money around by giving to a good cause or person today.

p/s: Are you happy? Do you need more money to 'buy' you happiness?