Can Money Buy You Happiness?

Despite what they say, money can buy you happiness and should be used to do so, providing it's done appropriately and in the right way.

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Despite what you were told, money can buy you happiness.

The new iPhone—13 if you’ve lost count—is out and it starts at an eye watering $800. Many people think that it’s a high price to pay, and that we would be better off investing the equivalent into the market.

They’re not wrong, but they also miss an important point.

Money can and should be used to make us happy.

But it’s our relationship with money, and how we use it that matters. Before we can chase happiness, it’s important to recognize how we’ve been taught to think about it wrong.

Money Misery

We never feel satisfied with money. We assume if we had just a little bit more money, we’d be happier. That’s because we associate happiness with the money itself: we convince ourselves that the more money we make, the better we’ll feel. But why?

Because we’ve been conditioned to think having more money will bring us more happiness. But when we have more money, we lose sight of our goals and only focus on what we can now afford, regardless of how it makes us feel.

We overestimate how much joy we get from having more. We believe a nice car will make us happy, but we just end up wanting a nicer one and then an even nicer one. But we’re still only able to drive it in the same traffic, at the same speed, to the same places we did before.

As you increase what you make and what you buy, you feel more pressure to sustain it – it could be taking on a more stressful job, or starting a side hustle – leading to more stress. The nicer car you thought you wanted? Well it winds up costing more to maintain, and having more things to take care of can actually mean less time and money to enjoy it.

Money isn’t what makes us happy, and the more we fixate on how much money we have or all the things we can now afford, the more stressful and less fulfilling it becomes.

Money Joy

Money is a tool. It won’t make us happy, but we can use it to do more of what makes us happy.

That’s why it’s important to distinguish between spending money on ‘things’, vs experiences and feelings that we care about. Research tells us that experiential purchases (money spent on doing) tend to provide more enduring happiness than material purchases (money spent on having).

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That doesn’t mean we should only spend our money on trips or waiting hours to get into a pricey new restaurant, but instead focusing on the feelings and experiences that make us happy rather than consuming things we think makes us happy.

A book that sits unread on a bookshelf is a thing; a book we plunge into with gusto, savoring every plot twist, is an experience. Spending on the experiences that make us feel good is the goal, not just buying things because we can.

Do I need more money?

Honestly, we probably don’t even need (that much) more money; it’s more likely we’re just not maximizing what we have for what makes us happy.

So whether it’s the new iPhone or an oat-milk, cold-foam, strawberry-hibiscus venti-large hot-iced coffee, if it’s an experience you love and can afford, that’s what you should be spending your money on.

Because money really can buy you more of what makes you happy.

Sent from my iPhone 13 Pro Max, with the extra shiny parts

Sam Garrison

Sam Garrison

Sam Garrison is the President and co-founder of Stackin, a financial wellness company. Before Stackin, Sam built and launched new ventures at BCG Digital Ventures, the venture and incubation arm of The Boston Consulting Group, where he also supported the executive team as strategic program lead. As a lifelong millennial, Sam has tried to solve most of his problems through technology instead of waiting in line at a drab office.