There is a whole list of things that money supposedly can’t buy, and one of the things on that is happiness. However, there is research that indicates that money can, in fact, buy happiness. The secret is in the way you use money. When you spend money on others, you are more likely to feel happier.
Spending On Yourself vs. Spending On Others
The idea that you can buy happiness by spending money on others is expressed by Michael Norton, a Harvard Business School associate professor. His TEDx talk on the subject cites studies done in different countries.
Researchers found that those who spent money on themselves weren’t any happier after the experiment. Spending money on yourself doesn’t make you unhappy; it just won’t boost your overall happiness. On the other hand, those that spent money on others did experience an increase in happiness.
The interesting thing is that it didn’t matter how much participants spent on others. Whether participants spent $5 or $20, they still saw an increase in their happiness. It was the thought — and the action of spending on others — that resulted in the happiness.
Norton also cited information from a Gallup poll that indicates that people who give to charity are happier overall than those who don’t. Giving to causes that you consider important, and helping others, can give you an emotional boost that goes beyond finances. It’s a boost you won’t get when you spend your money on yourself.
Spending money with (and on) your coworkers can also make you happier at work. Norton said that when teams of employees go out together, spending money on happy hours, they actually work better. The whole exercise can boost employee satisfaction and even improve productivity.
Don’t Get Carried Away
Just because spending money on others can make you happier in the long run, though, is not a good reason to get in over your head. It’s important to honestly evaluate your situation and consider whether or not you can truly afford to spend this money on others. While you might end up with a happiness while you are spending the money, and while you might feel good about helping out for a few weeks, if you do more than you can afford to do, you might end up in debt — and that causes its own problems.
This is why it’s worth noting that the dollar amount of the spending doesn’t matter. You can be just as happy buying your friend a $5 latte as you can handing over $100. And the conversation over the cup of coffee is probably going to be better than the awkwardness that comes with giving a large amount of money.
Think about what you can afford to do, and think of other ways that you can help. And remember that spending money on yourself probably isn’t going to result in more long-term happiness for you. So, if you have a little extra money, don’t go out and buy something for you, head out and buy something for someone else; you’ll get a better return.