can we buy happiness with money essay

  • The Magazine
  • Newsletters
  • Managing Yourself
  • Managing Teams
  • Work-life Balance
  • The Big Idea
  • Data & Visuals
  • Reading Lists
  • Case Selections
  • HBR Learning
  • Topic Feeds
  • Account Settings
  • Email Preferences

Does More Money Really Make Us More Happy?

  • Elizabeth Dunn
  • Chris Courtney

can we buy happiness with money essay

A big paycheck won’t necessarily bring you joy

Although some studies show that wealthier people tend to be happier, prioritizing money over time can actually have the opposite effect.

  • But even having just a little bit of extra cash in your savings account ($500), can increase your life satisfaction. So how can you keep more cash on hand?
  • Ask yourself: What do I buy that isn’t essential for my survival? Is the expense genuinely contributing to my happiness? If the answer to the second question is no, try taking a break from those expenses.
  • Other research shows there are specific ways to spend your money to promote happiness, such as spending on experiences, buying time, and investing in others.
  • Spending choices that promote happiness are also dependent on individual personalities, and future research may provide more individualized advice to help you get the most happiness from your money.

Ascend logo

Where your work meets your life. See more from Ascend here .

How often have you willingly sacrificed your free time to make more money? You’re not alone. But new research suggests that prioritizing money over time may actually undermine our happiness.

  • ED Elizabeth Dunn is a professor of psychology at the University of British Columbia and Chief Science Officer of Happy Money, a financial technology company with a mission to help borrowers become savers. She is also co-author of “ Happy Money: The Science of Happier Spending ” with Dr. Michael Norton. Her TED2019 talk on money and happiness was selected as one of the top 10 talks of the year by TED.
  • CC Chris Courtney is the VP of Science at Happy Money. He utilizes his background in cognitive neuroscience, human-computer interaction, and machine learning to drive personalization and engagement in products designed to empower people to take control of their financial lives. His team is focused on creating innovative ways to provide more inclusionary financial services, while building tools to promote financial and psychological well-being and success.

Partner Center

Happiness Economics: Can Money Buy Happiness?

Happiness economics

It only costs a small amount, a slight risk, with the possibility of a substantial reward.

But will it make you happy? Will it give you long-lasting happiness?

Undoubtedly, there will be a temporary peak in happiness, but will all your troubles finally fade away?

That is what we will investigate today. We explore the economics of happiness and whether money can buy happiness. In this post, we will start by broadly exploring the topic and then look at theories and substantive research findings. We’ll even have a look at previous lottery winners.

For interested readers, we will list interesting books and podcasts for further enjoyment and share a few of our own happiness resources.

Ka-ching: Let’s get rolling!

Before you continue, we thought you might like to download our three Happiness & Subjective Wellbeing Exercises for free . These detailed, science-based exercises will help you or your clients identify sources of authentic happiness and strategies to boost wellbeing.

This Article Contains

What is happiness economics, theory of the economics of happiness, can money buy happiness 5 research findings, 6 fascinating books and podcasts on the topic, resources from, a take-home message.

Happiness economics is a field of economics that recognizes happiness and wellbeing as important outcome measures, alongside measures typically used, such as employment, education, and health care.

Economics emphasizes how specific economic/financial characteristics affect our wellbeing (Easterlin, 2004).

For example, does employment result in better health and longer lifespan, among other metrics? Do people in wealthier countries have access to better education and longer life spans?

In the last few decades, there has been a shift in economics, where researchers have recognized the importance of the subjective rating of happiness as a valuable and desirable outcome that is significantly correlated with other important outcomes, such as health (Steptoe, 2019) and productivity (DiMaria et al., 2020).

Broadly, happiness is a psychological state of being, typically researched and defined using psychological methods. We often measure it using self-report measures rather than objective measures that are less vulnerable to misinterpretation and error.

Including happiness in economics has opened up an entirely new avenue of research to explore the relationship between happiness and money.

Andrew Clark (2018) illustrates the variability in the term happiness economics with the following examples:

  • Happiness can be a predictor variable, influencing our decisions and behaviors.
  • Happiness might be the desired outcome, so understanding how and why some people are happier than others is essential.

However, the connection between our behavior and happiness must be better understood. Even though “being happy” is a desired outcome, people still make decisions that prevent them from becoming happier. For example, why do we choose to work more if our work does not make us happier? Why are we unhappy even if our basic needs are met?

An example of how happiness can influence decision-making

Sometimes, we might choose not to maximize a monetary or financial gain but place importance on other, more subjective outcomes.

To illustrate: If faced with two jobs — one that pays well but will bring no joy and another that pays less but will bring much joy — some people would prefer to maximize their happiness over financial gain.

If this decision were evaluated using a utility framework where the only valued outcomes were practical, then the decision would seem irrational. However, this scenario suggests that psychological outcomes, such as the experience of happiness, are as crucial as other socio-economic outcomes.

Economists recognize that subjective wellbeing , or happiness, is an essential characteristic and sometimes a desirable outcome that can motivate our decision-making.

In the last few decades, economics has shifted to include happiness as a measurable and vital part of general wellbeing (Graham, 2005).

The consequence is that typical economic questions now also look at the impact of employment, finances, and other economic metrics on the subjective rating and experience of happiness at individual and country levels.

Theory of the economy of happiness

Happiness is such a vital outcome in society and economic activity that it must be involved in policy making. The subjective measure of happiness is as important as other typical measures used in economics.

Many factors can contribute to happiness. In this post, we consider the role of money. The relationship between happiness, or subjective wellbeing, and money is assumed to be positive: More money means greater happiness.

However, the relationship between money and happiness is paradoxical: More money does not guarantee happiness (for an excellent review, see Graham, 2005).

Specifically, low levels of income are correlated with unhappiness. However, as our individual wealth increases and our basic needs are met, our needs change and differ in their importance.

Initially, our happiness is affected by absolute levels of income, but at a certain threshold, we place importance on relative levels of income. Knowing how we rank and compare to other people, in terms of wealth and material possession, influences our happiness.

The relationship between wealth and happiness continues to increase, but only to a certain point; at this stage, more wealth does not guarantee more happiness (Easterlin, 1974; Diener et al., 1993).

This may be at odds with our everyday lived experience. Most of us choose to work longer hours or multiple jobs so that we make more money. However, what is the point of doing this if money does not increase our happiness? Why do we seem to think that more money will make us happier?

History of the economics of happiness

The relationship between economics and happiness originated in the early 1970s. Brickman and Campbell (1971, as cited in Brickman et al., 1978) first argued that the typical outcomes of a successful life, such as wealth or income, had no impact on individual wellbeing.

Easterlin (1974) expanded these results and showed that although wealthier people tend to be happier than poor people in the same country, the average happiness levels within a country remained unchanged even as the country’s overall wealth increased.

The inconsistent relationship between happiness and income and its sensitivity to critical income thresholds make this topic so interesting.

There is some evidence that wealthier countries are happier than others, but only when comparing the wealthy with the poor (Easterlin, 1974; Graham, 2005).

As countries become wealthier, citizens report higher happiness, but this relationship is strongest when the starting point is poverty. Above a certain income threshold, happiness no longer increases (Diener et al., 1993).

Interestingly, people tend to agree on the amount of money needed to make them happy; but beyond a certain value, there is little increase in happiness (Haesevoets et al., 2022).

Measurement challenges

Measuring happiness accurately and reliably is challenging. Researchers disagree on what happiness means.

It is not the norm in economics to measure happiness by directly asking a participant how happy they are; instead, happiness is inferred through:

  • Subjective wellbeing (Clark, 2018; Easterlin, 2004)
  • A combination of happiness and life satisfaction (Bruni, 2007)

Furthermore, happiness can refer to an acute psychological state, such as feeling happy after a nice meal, or a lasting state similar to contentment (Nettle, 2005).

Researchers might use different definitions of happiness and ways to measure it, thus leading to contradictory results. For example, happiness might be used synonymously with subjective wellbeing and can refer to several things, including life satisfaction and financial satisfaction (Diener & Oishi, 2000).

It seems contradictory that wealthier nations are not happier overall than poorer nations and that increasing the wealth of poorer nations does not guarantee that their happiness will increase too. What could then be done to increase happiness?

can we buy happiness with money essay

Download 3 Free Happiness Exercises (PDF)

These detailed, science-based exercises will equip you or your clients with tools to discover authentic happiness and cultivate subjective well-being.

Download 3 Free Happiness Tools Pack (PDF)

By filling out your name and email address below.

  • Email Address *
  • Your Expertise * Your expertise Therapy Coaching Education Counseling Business Healthcare Other
  • Name This field is for validation purposes and should be left unchanged.

What is the relationship between income/wealth and happiness? To answer that question, we looked at studies to see where and how money improves happiness, but we’ll also consider the limitations to the positive effect of income.

Money buys access; jobs boost happiness

Overwhelming evidence shows that wealth is correlated with measures of wellbeing.

Wealthier people have access to better healthcare, education, and employment, which in turn results in higher life satisfaction (Helliwell et al., 2012). A certain amount of wealth is needed to meet basic needs, and satisfying these needs improves happiness (Veenhoven & Ehrhardt, 1995).

Increasing happiness through improved quality of life is highest for poor households, but this is explained by the starting point. Access to essential services improves the quality of life, and in turn, this improves measures of wellbeing.

Most people gain wealth through employment; however, it is not just wealth that improves happiness; instead, employment itself has an important association with happiness. Happiness and employment are also significantly correlated with each other (Helliwell et al., 2021).

Lockdown on happiness

The World Happiness Report (Helliwell et al., 2021) reports that unemployment increased during the COVID-19 pandemic, and this was accompanied by a marked decline in happiness and optimism.

The pandemic also changed how we evaluated certain aspects of our lives; for example, the relationship between income and happiness declined. After all, what is the use of money if you can’t spend it? In contrast, the association between happiness and having a partner increased (Helliwell et al., 2021).

Wealthier states smile more, but is it real?


If we took a snapshot of happiness and a country’s wealth, we would find that richer countries tend to have happier populations than poorer countries.

For example, based on the 2021 World Happiness Report, the top five happiest countries — which are also wealthy countries — are Finland, Iceland, Denmark, Switzerland, and the Netherlands (Helliwell et al., 2021).

In contrast, the unhappiest countries are those that tend to be emerging markets or have a lower gross domestic product (GDP), e.g., Zimbabwe, Tanzania, and India (Graham, 2005; Helliwell et al., 2021).

At face value, this makes sense: Poorer countries most likely have other factors associated with them, e.g., higher unemployment, more crime, and less political stability. So, based on this cross-sectional data, a country’s wealth and happiness levels appear to be correlated. However, over a more extended period, the relationship between happiness and GDP is nil (Easterlin, 2004).

That is, the subjective wellbeing of a population does not increase as a country becomes richer. Even though the wealth of various countries worldwide has increased over time, the overall happiness levels have not increased similarly or have remained static (Kahneman et al., 2006). This is known as a happiness–income paradox.

Easterlin (2004) posits four explanations for this finding:

  • Societal and individual gains associated with increased wealth are concentrated among the extremely wealthy.
  • Our degree of happiness is informed by how we compare to other people, and this relative comparison does not change as country-wide wealth increases.
  • Happiness is not limited to only wealth and financial status, but is affected by other societal and political factors, such as crime, education, and trust in the government.
  • Long-term satisfaction and contentment differ from short-term, acute happiness.

Kahneman et al. (2006) provide an alternative explanation centered on the method typically used by researchers. Specifically, they argue that the order of the questions asked to measure happiness and how these questions are worded have a focusing effect. Through the question, the participant’s attention to their happiness is sharpened — like a lens in a camera — and their happiness needs to be over- or underestimated.

Kahneman et al. (2006) also point out that job advancements like a raise or a promotion are often accompanied by an increase in salary and work hours. Consequently, high-paying jobs often result in less leisure time available to spend with family or on hobbies and can cause more unhappiness.

Not all that glitters is gold

Extensive research explored whether a sudden financial windfall was associated with a spike in happiness (e.g., Sherman et al., 2020). The findings were mixed. Sometimes, having more money is associated with increased life satisfaction and improved physical and mental health.

This boost in happiness, however, is not guaranteed, nor is it long. Sometimes, individuals even wish it had never happened (Brickman et al., 1978; Sherman et al., 2020).

Consider lottery winners. These people win sizable sums of money — typically more extensive than a salary increase — large enough to impact their lives significantly. Despite this, research has consistently shown that although lottery winners report higher immediate, short-term happiness, they do not experience higher long-term happiness (Sherman et al., 2020).

Here are some reasons for this:

  • Previous everyday activities and experiences become less enjoyable when compared to a unique, unusual experience like winning the lottery.
  • People habituate to their new lifestyle.
  • A sudden increase in wealth can disrupt social relationships among friends and family members.
  • Work and hobbies typically give us small nuggets of joy over a more extended period (Csikszentmihalyi et al., 2005). These activities can lose their meaning over a longer period, resulting in more unhappiness (Sherman et al., 2020; Brickman et al., 1978).

Sherman et al. (2020) further argue that lottery winners who decide to quit their job after winning, but do not fill this newly available time with some type of meaningful hobby or interest, are also more likely to become unhappy.

Passive activities do not provide the same happiness as work or hobbies. Instead, if lottery winners continue to take part in activities that give them meaning and require active engagement, then they can avoid further unhappiness.

Happiness: Is it temperature or climate?

Like most psychological research, part of the challenge is clearly defining the topic of investigation — a task made more daunting when the topic falls within two very different fields.

Nettle (2005) describes happiness as a three-tiered concept, ranging from short-lived but intense on one end of the spectrum to more abstract and deep on the other.

The first tier refers to transitory feelings of joy, like when one opens up a birthday present.

The second tier describes judgments about feelings, such as feeling satisfied with your job. The third tier is more complex and refers to life satisfaction.

Across research, different definitions are used: Participants are asked about feelings of (immediate) joy, overall life satisfaction, moments of happiness or satisfaction, and mental wellbeing . The concepts are similar but not identical, thus influencing the results.

Most books on happiness economics are textbooks. Although no doubt very interesting, they’re not the easy-reading books we prefer to recommend.

Instead, below you will find a range of books written by economists that explore happiness. These should provide a good springboard on the overall topic of happiness and what influences it, in case any of our readers want to pick up a more in-depth textbook afterward.

If you have a happiness book you would recommend, please let us know in the comments section.

1. Happiness: Lessons from a New Science – Richard Layard


Richard Layard, a lead economist based in London, explores in his book if and how money can affect happiness.

Layard does an excellent job of introducing topics from various fields and framing them appropriately for the reader.

The book is aimed at readers from varying academic and professional backgrounds, so no experience is needed to enjoy it.

Find the book on Amazon .

2. Happiness by Design: Change What You Do, Not How You Think – Paul Dolan

Happiness by Design

This book has a more practical spin. The author explains how we can use existing research and theories to make small changes to increase our happiness.

Paul Dolan’s primary thesis is that practical things will have a bigger effect than abstract methods, and we should change our behavior rather than our thinking.

The book is a quick read (airport-perfect!), and Daniel Kahneman penned the foreword.

3. The Psychology of Money: Timeless Lessons on Wealth, Greed and Happiness – Morgan Housel

The Psychology of Money

This book is not necessarily about happiness economics, but it is close enough to the overall theme that it is worth mentioning.

Since most people are concerned with making more money, this book helps teach the reader why we make the decisions we do and how we make better decisions about our money.

This book is a worthwhile addition to any bookcase if you are interested in the relationship between finances and psychology in general.

4. Happiness: The Science Behind Your Smile – Daniel Nettle


If you are interested in happiness overall, then we recommend Happiness: The Science Behind Your Smile by Daniel Nettle, a professor of behavioral science at Newcastle University.

In this book, he takes a scientific approach to explaining happiness, starting with an in-depth exploration of the definition of happiness and some of its challenges.

The research that he presents comes from various fields, including social sciences, medicine, neurobiology, and economics.

Because of its small size, this book is perfect for a weekend away or to read on a plane.

5 & 6. Prefer to listen rather than read?

One of our favorite podcasts is Intelligence2, where leading experts in a particular field gather to debate a particular topic.

Money Can't Buy Happiness

This show’s host, Dr. Laurie Santos, argues that we can increase our happiness by not hoarding our money for ourselves but by giving it to others instead. If you are interested in this episode , or any of the other episodes in the Happiness Lab podcast series, then head on over to their page.

There are several resources available at for our readers to use in their professional and personal development.

In this section, you’ll find a few that should supplement any work on happiness and economics. Since the undercurrent of the topic is whether happiness can be improved through wealth, a few resources look at happiness overall.

Valued Living Masterclass

Although knowledge is power, knowing that money does not guarantee happiness does not mean that clients will suddenly feel fulfilled and satisfied with their lives.

For this reason, we recommend the Valued Living Masterclass , for professionals to help their clients find meaning in their lives. Rather than keeping up with the Joneses or chasing a high-paying job, professionals can help their clients connect with their inner meaning (i.e., their why ) as a way to find meaning and gain happiness.

Three free exercises

If you want to try it out before committing, look at the Meaning & Valued Living exercise pack , which includes three exercises for free.

Recommended reading

Read our post on Success Versus Happiness for further information on balancing happiness with success, in any domain . This topic is poignant for readers who conflate happiness and success, and will guide readers to better understand their relationship and how the two terms influence each other.

For readers who wonder about altruism , you would find it interesting that rather than hoarding, you can increase your happiness through volunteering and donating. In this post, the author, Dr. Jeremy Sutton, does a fabulous job of approaching altruism from various fields and provides excellent resources for further reading and real-life application.

Our last recommendation is for readers who want to know more about measuring subjective wellbeing and happiness . The post lists various tests and apps that can measure happiness and the overall history of how happiness was measured and defined. This is a good starting point for researchers or clinicians who want to explore happiness economics professionally.

17 Happines Exercises

If you’re looking for more science-based ways to help others develop strategies to boost their wellbeing, this collection contains 17 validated happiness and wellbeing exercises . Use them to help others pursue authentic happiness and work toward a  life filled with purpose and meaning

can we buy happiness with money essay

17 Exercises To Increase Happiness and Wellbeing

Add these 17 Happiness & Subjective Well-Being Exercises [PDF] to your toolkit and help others experience greater purpose, meaning, and positive emotions.

Created by Experts. 100% Science-based.

As you’ve seen in our article, the evidence overwhelmingly clarifies that money does not guarantee more happiness … well, long-term happiness.

Our happiness is relative since we compare ourselves to other people, and over time, as we become accustomed to our wealth, we lose all the happiness gains we made.

Money can ease financial and social difficulties; consequently, it can drastically improve people’s living conditions, life expectancy, and education.

Improvements in these outcomes have a knock-on effect on the overall experience of one’s life and the opportunities for one’s family and children. Nevertheless, better opportunities do not guarantee happiness.

Our intention with this post was to illustrate some complexities surrounding the relationship between money and happiness.

Knowing that money does not guarantee happiness, we recommend less expensive methods to improve one’s happiness:

  • Spend time with friends.
  • Cultivate hobbies and interests.
  • Stay active and eat healthy.
  • Try to live a meaningful life.
  • Give some love (go smooch your partner or tickle your dog’s belly).

Diamonds might be a girl’s best friend, but money is a fair weather one, at best.

We hope you enjoyed reading this article. Don’t forget to download our three Happiness Exercises for free .

  • Brickman, P., Coates, D., & Janoff-Bulman, R. (1978). Lottery winners and accident victims: Is happiness relative? Journal of Personality and Social Psychology , 36 (8), 917.
  • Bruni, L. (2007). Handbook on the economics of happiness . Edward Elgar.
  • Clark, A. E. (2018). Four decades of the economics of happiness: Where next? Review of Income and Wealth , 64 (2), 245–269.
  • Csikszentmihalyi, M., Abuhamdeh, S., & Nakamura, J. (2005). Flow. In A. J. Elliot & C. S. Dweck (Eds.), Handbook of competence and motivation (pp. 598–608). Guilford Publications.
  • Diener, E., Sandvik, E., Seidlitz, L., & Diener, M. (1993). The relationship between income and subjective well-being: Relative or absolute? Social Indicators Research , 28 , 195–223.
  • Diener, E., & Oishi, S. (2000). Money and happiness: Income and subjective well-being across nations. Culture and Subjective Well-Being , 185 , 218.
  • DiMaria, C. H., Peroni, C., & Sarracino, F. (2020). Happiness matters: Productivity gains from subjective well-being. Journal of Happiness Studies , 21 (1), 139–160.
  • Easterlin, R. A. (1974). Does economic growth improve the human lot? Some empirical evidence. In P. A. David & M. W. Reder (Eds.), Nations and households in economic growth: Essays in honor of Moses Abramovitz (pp. 89–125). Academic Press.
  • Easterlin, R. A. (2004). The economics of happiness. Daedalus , 133 (2), 26–33.
  • Graham, C. (2005). The economics of happiness. World Economics , 6 (3), 41–55.
  • Haesevoets, T., Dierckx, K., & Van Hiel, A. (2022). Do people believe that you can have too much money? The relationship between hypothetical lottery wins and expected happiness. Judgment and Decision Making , 17 (6), 1229–1254.
  • Helliwell, J., Layard, R., & Sachs, J. (Eds.) (2012). World happiness report . The Earth Institute, Columbia University.
  • Helliwell, J. F., Layard, R., Sachs, J. D., & Neve, J. E. D. (2021). World happiness report 2021 .
  • Kahneman, D., Krueger, A. B., Schkade, D., Schwarz, N., & Stone, A. A. (2006). Would you be happier if you were richer? A focusing illusion. Science , 312 (5782), 1908–1910.
  • Nettle, D. (2005). Happiness: The science behind your smile . Oxford University Press.
  • Sherman, A., Shavit, T., & Barokas, G. (2020). A dynamic model on happiness and exogenous wealth shock: The case of lottery winners. Journal of Happiness Studies , 21 , 117–137.
  • Steptoe, A. (2019). Happiness and health. Annual Review of Public Health , 40 , 339–359.
  • Veenhoven, R., & Ehrhardt, J. (1995). The cross-national pattern of happiness: Test of predictions implied in three theories of happiness. Social Indicators Research , 34 , 33–68.

' src=

Share this article:

Article feedback

Let us know your thoughts cancel reply.

Your email address will not be published.

Save my name, email, and website in this browser for the next time I comment.

Related articles


Embracing JOMO: Finding Joy in Missing Out

We’ve probably all heard of FOMO, or ‘the fear of missing out’. FOMO is the currency of social media platforms, eager to encourage us to [...]


The True Meaning of Hedonism: A Philosophical Perspective

“If it feels good, do it, you only live once”. Hedonists are always up for a good time and believe the pursuit of pleasure and [...]

Eudaimonic vs Hedonic Wellbeing

Hedonic vs. Eudaimonic Wellbeing: How to Reach Happiness

Have you ever toyed with the idea of writing your own obituary? As you are now, young or old, would you say you enjoyed a [...]

Read other articles by their category

  • Body & Brain (49)
  • Coaching & Application (57)
  • Compassion (26)
  • Counseling (51)
  • Emotional Intelligence (24)
  • Gratitude (18)
  • Grief & Bereavement (21)
  • Happiness & SWB (40)
  • Meaning & Values (26)
  • Meditation (20)
  • Mindfulness (45)
  • Motivation & Goals (45)
  • Optimism & Mindset (34)
  • Positive CBT (28)
  • Positive Communication (20)
  • Positive Education (47)
  • Positive Emotions (32)
  • Positive Leadership (17)
  • Positive Parenting (3)
  • Positive Psychology (33)
  • Positive Workplace (37)
  • Productivity (16)
  • Relationships (46)
  • Resilience & Coping (36)
  • Self Awareness (21)
  • Self Esteem (37)
  • Strengths & Virtues (31)
  • Stress & Burnout Prevention (34)
  • Theory & Books (46)
  • Therapy Exercises (37)
  • Types of Therapy (64)
  • Phone This field is for validation purposes and should be left unchanged.

3 Happiness Exercises Pack [PDF]

A business journal from the Wharton School of the University of Pennsylvania

Does Money Buy Happiness? Here’s What the Research Says

March 28, 2023 • 5 min read.

Reconciling previously contradictory results, researchers from Wharton and Princeton find a steady association between larger incomes and greater happiness for most people but a rise and plateau for an unhappy minority.

Person running over stacks of money to illustrate whether money can buy happiness

  • Finance & Accounting

The following article was originally published on Penn Today .

Does money buy happiness? Though it seems like a straightforward question, research had previously returned contradictory findings, leaving uncertainty about its answer.

Foundational work published in 2010 from Princeton University’s  Daniel Kahneman  and Angus Deaton had found that day-to-day happiness rose as annual income increased, but above $75,000 it leveled off and happiness plateaued. In contrast, work published in 2021 from the University of Pennsylvania’s  Matthew Killingsworth  found that happiness rose steadily with income well beyond $75,000, without evidence of a plateau.

To reconcile the differences, Kahneman and Killingsworth paired up in what’s known as an adversarial collaboration, joining forces with Penn Integrates Knowledge  University Professor  Barbara Mellers  as arbiter. In a new  Proceedings of the National Academy of Sciences  paper , the trio shows that, on average, larger incomes are associated with ever-increasing levels of happiness. Zoom in, however, and the relationship becomes more complex, revealing that within that overall trend, an unhappy cohort in each income group shows a sharp rise in happiness up to $100,000 annually and then plateaus.

“In the simplest terms, this suggests that for most people larger incomes are associated with greater happiness,” says Killingsworth, a senior fellow at Wharton and lead paper author. “The exception is people who are financially well-off but unhappy. For instance, if you’re rich and miserable, more money won’t help. For everyone else, more money was associated with higher happiness to somewhat varying degrees.”

Mellers digs into this last notion, noting that emotional well-being and income aren’t connected by a single relationship. “The function differs for people with different levels of emotional well-being,” she says. Specifically, for the least happy group, happiness rises with income until $100,000, then shows no further increase as income grows. For those in the middle range of emotional well-being, happiness increases linearly with income, and for the happiest group the association actually accelerates above $100,000.

Joining Forces to Ask: “Does Money Buy Happiness?”

The researchers began this combined effort recognizing that their previous work had drawn different conclusions. Kahneman’s 2010 study showed a flattening pattern where Killingsworth’s 2021 study did not. As its name suggests, an adversarial collaboration of this type — a notion originated by Kahneman — aims to solve scientific disputes or disagreements by bringing together the differing parties, along with a third-party mediator.

Killingsworth, Kahneman, and Mellers focused on a new hypothesis that both a happy majority and an unhappy minority exist. For the former, they surmised, happiness keeps rising as more money comes in; the latter’s happiness improves as income rises but only up to a certain income threshold, after which it progresses no further.

To test this new hypothesis, they looked for the flattening pattern in data from Killingworth’s study, which he had collected through an app he created called Track Your Happiness. Several times a day, the app pings participants at random moments, asking a variety of questions including how they feel on a scale from “very good” to “very bad.” Taking an average of the person’s happiness and income, Killingsworth draws conclusions about how the two variables are linked.

A breakthrough in the new partnership came early on when the researchers realized that the 2010 data, which had revealed the happiness plateau, had actually been measuring unhappiness in particular rather than happiness in general.

“It’s easiest to understand with an example,” Killingsworth says. Imagine a cognitive test for dementia that most healthy people pass easily. While such a test could detect the presence and severity of cognitive dysfunction, it wouldn’t reveal much about general intelligence since most healthy people would receive the same perfect score.

“In the same way, the 2010 data showing a plateau in happiness had mostly perfect scores, so it tells us about the trend in the unhappy end of the happiness distribution, rather than the trend of happiness in general. Once you recognize that, the two seemingly contradictory findings aren’t necessarily incompatible,” Killingsworth says. “And what we found bore out that possibility in an incredibly beautiful way. When we looked at the happiness trend for unhappy people in the 2021 data, we found exactly the same pattern as was found in 2010; happiness rises relatively steeply with income and then plateaus.”

“The two findings that seemed utterly contradictory actually result from data that are amazingly consistent,” he says.

Does It Matter Whether Money Can Buy Happiness?

Drawing these conclusions would have been challenging had the two research teams not come together, says Mellers, who suggests there’s no better way than adversarial collaborations to resolve scientific conflict.

“This kind of collaboration requires far greater self-discipline and precision in thought than the standard procedure,” she says. “Collaborating with an adversary — or even a non-adversary — is not easy, but both parties are likelier to recognize the limits of their claims.” Indeed, that’s what happened, leading to a better understanding of the relationship between money and happiness.

And these findings have real-world implications, according to Killingsworth. For one, they could inform thinking about tax rates or how to compensate employees. And, of course, they matter to individuals as they navigate career choices or weigh a larger income against other priorities in life, Killingsworth says.

However, he adds that for emotional well-being money isn’t the be all end all. “Money is just one of the many determinants of happiness,” he says. “Money is not the secret to happiness, but it can probably help a bit.”

More From Knowledge at Wharton

can we buy happiness with money essay

How Financial Literacy Affects Household Debt and Bankruptcy | Sasha Indarte

can we buy happiness with money essay

How Stock Price Volatility in Closely Held Firms Distorts Capital Allocation

can we buy happiness with money essay

What Are Some of the Keys to Responsible Investing?

Looking for more insights.

Sign up to stay informed about our latest article releases.

Greater Good Science Center • Magazine • In Action • In Education

Happiness Articles & More

Can money buy happiness it depends on why you’re spending it, according to new research, our purchases may make us happier when they're motivated by goals we care about..

Imagine that someone gives you a cash gift and tells you that, instead of saving or investing it, you need to spend it right now. What should you put your money toward if you want to make yourself happiest?

According to past research , we’ll be happier if we spend money on an experience than if we buy a material object—like traveling or going out for a meal instead of buying the latest product we see on social media. For example, people report more gratitude when they spend on experiences rather than possessions.

On the other hand, we can all probably think of times when we’ve spent money on an experience that ended up not being worth it. Maybe you bought pricey event tickets to avoid missing out, only to realize on the day of the event that you’d much prefer a cozy night at home. Or perhaps you went out to dinner with a friend at a fancy restaurant, only to find that your friend was more focused on posting the meal to Instagram than having a deep conversation.

can we buy happiness with money essay

It turns out that there might be another factor at play beyond whether we spend money on an experience or a material item: According to a new study published in the British Journal of Social Psychology , it may also matter how our purchases align with our goals.

In the study, researchers asked 452 participants in an online survey to describe a recent purchase. They were asked to write about something they had spent money on in the last three months (ranging from about $60 to $1,200), excluding everyday expenses such as bills and groceries. After describing it, people were asked to indicate the extent to which the purchase helped to fulfill different goals. They also noted how much they felt the purchase contributed to their happiness and life satisfaction.

According to self-determination theory , goals reflect our intrinsic and extrinsic motivations. Extrinsic goals are things that other people expect for us: for example, working hard at a job not because you’re passionate about the work, but because you need the money or want a high-status job to impress others. Intrinsic goals, on the other hand, are ones that we have a strong internal motivation to pursue. In the survey, extrinsic goals included gaining wealth or social status, whereas intrinsic ones included cultivating relationships, helping other people, and contributing to growth, learning, and development.

The researchers found that, the more a purchase reflected people’s intrinsic goals, the more they thought it improved their well-being. In other words, the greatest well-being occurred when people spent money on something that was personally important to them.

To compare this finding with past research, the current study also asked participants to indicate to what extent their purchase was an experience or a material item. As in past research, participants did report higher well-being from experiences. However, when the researchers looked at both factors together, they found that how much a purchase reflected intrinsic goals explained more of the differences in well-being than whether something was material or experiential.

So, what does this research mean for our spending habits? Olaya Moldes Andrés, lecturer at Cardiff University and the study’s author, points out that we’re under a lot of pressure to spend money these days; just think about the number of targeted ads you see each time you open social media. However, this pressure to spend has a downside: In past research , Moldes Andrés has found that people who are exposed to more materialistic messages have lower well-being.

Before purchasing something, she recommends pausing to think about the reason for our purchase, and what use we will get out of it. If we’re spending money on trying to impress people or project a certain image (in other words, extrinsic goals), the purchase may not actually be worth it.

So, next time you’re planning to buy something, take a moment to think about whether it’s something you’re buying because you feel it’s what’s expected of you—or whether it’s truly something that you want.

About the Author

Elizabeth Hopper

Elizabeth Hopper

Elizabeth Hopper, Ph.D. , received her Ph.D. in psychology from UC Santa Barbara and currently works as a freelance science writer specializing in psychology and mental health.

You May Also Enjoy

How Does Valuing Money Affect Your Happiness?

This article — and everything on this site — is funded by readers like you.

Become a subscribing member today. Help us continue to bring “the science of a meaningful life” to you and to millions around the globe.

  • Visit the University of Nebraska–Lincoln
  • Apply to the University of Nebraska–Lincoln
  • Give to the University of Nebraska–Lincoln

Search Form

Can money buy happiness, three psychological principles to consider before you make your next purchase.

By Sarah Gervais, Associate Professor of Psychology, Social and Cognitive Program and Law-Psychology Program

11 Nov 2015

Sarah Gervais

We’re all familiar with the idea that money can’t buy happiness. Yet, the reality is that we all spend money and for most of us it is a limited resource. How can we spend our hard earned dough in ways that will maximize our happiness? Psychological research offers some useful insights about the connections between money and happiness to consider before you make your next purchase.

  • Being Rich Isn’t Necessarily the Path to Happiness. Money is important to happiness. Ask anyone who doesn’t have it. Having a higher income, for example, can give us access to homes in safer neighborhoods, better health care and nutrition, fulfilling work, and more leisure time. However, this only works up to a certain point. Once our income reaches a certain level and our basic needs for food, health care, safety, and shelter are met, the positive effects of money—such as buying your dream home—are often offset by the negative effects—such as working longer hours, or in more stressful jobs, to maintain that income.
  • Doing Makes us Happier than Having. Most people assume that “things” will lead to more happiness than “experiences.” Physical objects—such as the latest iPhone, handbag, or car—last longer than say going to a concert, taking a cooking class, or going on vacation. Buying things does make us happy, at least in the short term. In the long-term, however, we habituate to new things and even though they may have made us excited and happy at first, eventually the item becomes the new normal and fades into the background. The happiness that comes from purchasing experiences, however, tends to increase over time. One reason is that we often share experiential purchases with other people. Even when you’ve driven that new car into the ground, you’ll still be telling stories with your family and friends about that time when you went on vacation to Colorado and you’ll even be chuckling about when the car broke down and you had to spend the night in the shady motel
  • Consider Spending Money on Others. Most people think that spending money on themselves will make them happier than spending it on other people. Yet, when researchers assess happiness before and after people spend an annual bonus, people report greater happiness when they spend the bonus money on others or donate it to charity than when they spend it on themselves. This occurs regardless of how big the bonus was. One reason for this phenomenon is that giving to others makes us feel good about ourselves

So, before you pull out your wallet or click to order online, think about whether this purchase will really make you happy. If it will jeopardize your basic needs, think twice. If you have some disposable income, considering planning a trip or taking a class to learn a new skill. Finally, in this season of giving, know that if you spend your money on others or donate it to good causes, you may feel better than if you spend it on yourself.

Note: This article presents some basic principles for money and happiness. Individuals differ in their financial situation and psychological well-being. Consult a financial expert or behavioral health professional for guidance about finances and happiness.

Group of people at party laughing.

One More Time, Does Money Buy Happiness?

  • Published: 19 September 2023
  • Volume 18 , pages 3089–3110, ( 2023 )

Cite this article

  • James Fisher   ORCID: 1 &
  • Michael Frechette   ORCID: 2  

1139 Accesses

Explore all metrics

This paper integrates multiple positions on the relationship between money and well-being, commonly referred to as happiness. An aggregation of prior work appears to suggest that money does buy happiness, but not directly. Although many personal and situational characteristics do influence the relationship between money and happiness, most are moderating factors, which would not necessarily rule out a direct link. Here, we discuss the cognitive and affective elements within the formation of happiness, which we propose play a series of mediating roles, first cognition, then affect, between money and happiness. The paper concludes with a discussion about how this proposal influences academic research and society as a whole.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price includes VAT (Russian Federation)

Instant access to the full article PDF.

Rent this article via DeepDyve

Institutional subscriptions

can we buy happiness with money essay

Similar content being viewed by others

can we buy happiness with money essay

The Functional and Dysfunctional Aspects of Happiness: Cognitive, Physiological, Behavioral, and Health Considerations

can we buy happiness with money essay

Happiness, Economics of

can we buy happiness with money essay

What We Have Learnt About Happiness

Materials and/or code availability.

There are no materials or code related to this manuscript.

Data Availability

This conceptual study collected no original data. Citations are given to the original sources when referencing data or results from prior studies.

“As far as I am aware, in every representative national survey ever done a significant positive bivariate relationship between happiness and income has been found.” (Easterlin 2001 , 468). Easterlin supports this assertion with references to Andrews 1996 , xi; Argyle 1999 , 356–57; and Diener 1984 , 553.

A simple correlation of 0.2 is an oft-cited benchmark (cf. Easterlin 2001 , who labels it “highly significant”). At the same time, many researchers qualify the relationship, saying that income ultimately explains relatively little of the variance in self-reports of happiness: e.g., Ahuvia ( 2017 , 18) generalizes that “typically studies in developed economies indicate that income explains only about 3% of the difference in happiness.” Some twenty years prior to Ahuvia’s assessment, Frank ( 1997 ) offered a similar conclusion: the relationship between income and happiness is closer at lower levels of income than for middle- or upper-income households, where "variations in income explain less than 2% of variations in reported satisfaction levels” (citing Diener and Diener 1995 on 1835). Diener and Biswas-Diener ( 2002 , 123) summarize over a dozen correlations between income and subjective well-being, most ranging between 0.15 and 0.25. Kahneman and Deaton ( 2010 ) recommend that efforts to estimate the relationship between that subjective well-being and income should rely on a logarithmic transformation of income, providing a rationale based on Weber’s Law, having to do with the perception of change reflecting the percentage change and not the absolute change.

This literature review reflects the authors’ point-of-view that in answering the question of “how” money buys happiness economists have offered the highest-level, abstract answer (i.e., through a process of utility-maximization); psychologists and researchers into subjective well-being have sought a more precise accounting of what money buys vis-à-vis individual dispositions (e.g., personality) and motivations (e.g., materialism) as well as cultural or national determinants (e.g., individualism versus collectivism); and marketers and consumer researchers have inquired in the most detailed way as to how money delivers particular experiences and effects throughout the continuum of pre-purchase processes, the experience of consumption and post-purchase satisfaction.

Happiness data are a relative late-comers to economic analyses of this sort: “[T]he approach departs from a long tradition in economics that shies away from using what people say about their feelings. Instead, economists have built their trade by analyzing what people do and, from these observations and some theoretical assumptions about the structure of welfare, deducing the implied changes in happiness” (Di Tella and MacCulloch 2006 , 43). Kahneman and Krueger ( 2006 , 3) express a similar opinion: “[E]conomists have had a long-standing preference for studying peoples’ revealed preferences; that is, looking at individuals’ actual choices and decisions rather than their stated intentions or subjective reports of likes and dislikes.”.

An assertion strenuously challenged by Diener and Oishi 2000 and more modestly objected to by Frank ( 1997 , 1820), who interprets the data to say that there “is only slight evidence … that greater economic prosperity leads to more well-being in a nation.”.

Cummins ( 2000 ), in his review of personal income and subjective well-being, constructs a couple of straw men that reflect his estimation of how researchers into quality of life may view income ambivalently. At the outset of the review article, his abstract announces, "Conventional wisdom holds that money has little relevance to happiness." Later in the same review article, he identifies a bias "that can quite commonly be found within the QOL literature" (p. 139) that the rich are not as satisfied with their lot as commonly imagined. Chambers ( 1997 ) provides him with a suitable proof text in which "the link between wealth and well-being is weak or even negative" and therefore, "amassing wealth does not assure well-being and may diminish it” (at 1728 in Chambers). Cummins himself disavows this disciplinary tendency, ultimately labeling it “fanciful.”.

When it comes to terms like subjective well-being, life satisfaction, and happiness, there is some variation in the precision of the terminology. Thus, Kahneman and Krueger ( 2006 ) use life satisfaction and happiness as roughly synonymous in discussing the measurement of well-being and in emphasizing the measurement of emotional states. On the other hand, Diener may commonly use the term happiness as a convenient and widely used construct but will employ more precision in measuring or analyzing "types of well-being.".

E.g., basic needs met, psychological needs met, and satisfaction with living standards in Diener, Ng, Harter and Arora ( 2010 , 56).

E.g., pleasant affect, unpleasant affect, life satisfaction, and domain satisfaction in Diener, Suh, Lucas and Smith ( 1999 , 277).

Dunn et al. ( 2011 ) stake out this position with their article’s title “If money doesn’t make you happy, then you probably aren’t spending it right.”.

Thus, Scitovsky’s title, The Joyless Economy .

Actually, it is nice to be rich. (2023, March 24). The Week , 33.

Ahuvia, A. C. (2017). Consumption, Income and Happiness. In Alan Lewis (Ed.), The Cambridge Handbook of Psychology and Economic Behaviour, Cambridge. Cambridge: Cambridge University Press.

Google Scholar  

Allcott, H., Braghieri, L., Eichmeyer, S., & Gentzkow, M. (2020). The welfare effects of social media. American Economic Review, 110 (3), 629–676.

Article   Google Scholar  

Andrews, F. (1996). Editor’s introduction. In F. Andrews (Ed.), Research on the Quality of Life (pp. ix–xiv). University of Michigan.

Argyle, M. (1999). 'Causes and correlates of happiness,' in (D. Kahneman, E. Diener, and N. Schwarz eds.), Well-Being: The Foundations of Hedonic Psychology , (pp. 353–73). New York: Russell Sage Foundation.

Auerbach, A. J., Kotlikoff, L. J., & Koehler, D. (2016). US Inequality and Fiscal Progressivity: An Intragenerational Accounting. Available at SSRN 2747187 .

Bradburn, N. M. (1969). The structure of psychological well-being . Aldine.

Bradburn, N. M., & Caplovitz, D. (1965). Reports on Happiness: A Pilot Study of Behavior Related to Mental Health . Aldine Publishing Company.

Bryson, A., & MacKerron, G. (2017). Are you happy while you work? The Economic Journal, 127 (599), 106–125.

Brzozowski, M., & Spotton Visano, B. (2020). Havin’ money’s not everything, not havin’ it is: The importance of financial satisfaction for life satisfaction in financially stressed households. Journal of Happiness Studies, 21 (2), 573–591.

Cantril, H. (1965). The pattern of human concerns . Rutgers University Press.

Chambers, R. (1997). Responsible well-being—A personal agenda for development. World Development, 25 (11), 1743–1754.

Clark, A. E., Frijters, P., & Shields, M. A. (2008). Relative income, happiness, and utility: An explanation for the Easterlin paradox and other puzzles. Journal of Economic literature , 46 (1), 95–144.

Coy, P. (2022, July 18) There’s a Better Way to Measure Economic Inequality: Differences in wealth or income are not good gauges. New York Times, .

Cummins, R. A. (2000). Personal income and subjective well-being: A review. Journal of Happiness Studies, 1 , 133–158.

Di Tella, R., & MacCulloch, R. (2006). Some uses of happiness data in economics. The Journal of Economic Perspectives, 20 (1), 25–46.

Diener, E. (1984). Subjective well-being. Psychological Bulletin, 95 (3), 542–575.

Diener, E. (2012). New findings and future directions for subjective well-being research. American Psychologist, 67 (8), 590–597.

Diener, E., & Biswas-Diener, R. (2002). Will money increase subjective well-being? A literature review guide to needed research. Social Indicators Research, 57 (2), 119–169.

Diener, E., & Diener, C. (1995). The wealth of nations revisited: Income and quality of life. Social Indicators Research, 36 (3), 275–286.

Diener, E., & Seligman, M. E. (2004). Beyond money: Toward an economy of well-being. Psychological Science in the Public Interest, 5 (1), 1–31.

Diener, E., Suh, E. M., Lucas, R. E., & Smith, H. L. (1999). Subjective well-being: Three decades of progress. Psychological Bulletin, 125 (2), 276–302.

Diener, E., Ng, W., Harter, J., & Arora, R. (2010). Wealth and happiness across the world: Material prosperity predicts life evaluation, whereas psychosocial prosperity predicts positive feeling. Journal of Personality and Social Psychology, 99 (1), 52–61.

Diener, E., & Oishi, S. (2000). Money and happiness: Income and subjective well-being across nations. Culture and Subjective Well-Being. 185–218.

Dreilinger, D. (2021). The Secret History of Home Economics: How Trailblazing Women Harnessed the Power of Home and Changed the Way We Live . W.W. Norton & Company Inc.

Dunn, E. W., & Weidman, A. C. (2015). Building a science of spending: Lessons from the past and directions for the future. Journal of Consumer Psychology, 25 (1), 172–178.

Dunn, E. W., Gilbert, D. T., & Wilson, T. D. (2011). If money doesn’t make you happy, then you probably aren’t spending it right. Journal of Consumer Psychology, 21 (2), 115–125.

Easterlin, R. A. (1973). Does money buy happiness? The Public Interest, 30 , 3–10.

Easterlin, R. A. (1974). Does economic growth improve the human lot? Some empirical evidence. In P. A. David & M. W. Reder (Eds.), Nations and households in economic growth: Essays in honour of Moses Abramovitz (pp. 89–125). Academic Press.

Easterlin, R. A. (2001). Income and happiness: Towards a unified theory. The Economic Journal, 111 (473), 465–484.

Easterlin, R. A. (2003). Explaining happiness. Proceedings of the National Academy of Sciences, 100 (19), 11176–11183.

Easterlin, R. A. (2005). Feeding the illusion of growth and happiness: A reply to Hagerty and Veenhoven. Social Indicators Research, 74 (3), 429–443.

Easterlin, R. A., McVey, L. A., Switek, M., Sawangfa, O., & Zweig, J. S. (2010). The happiness-income paradox revisited. Proceedings of the National Academy of Sciences., 107 (52), 22463–22468.

Easterlin, R. A., & O'Connor, K. J. (2020). The Easterlin Paradox. IZA Institute of Labor Economics Discussion Paper Series. No. 13923. Available at: .

Ekici, T., & Koydemir, S. (2016). Income expectations and happiness: Evidence from British panel data. Applied Research in Quality of Life, 11 (2), 539–552.

Frank, R. H. (1997). The frame of reference as a public good. The Economic Journal, 107 (445), 1832–1847.

Frey, B., & Stutzer, A. (2002). What can economists learn from happiness research? Journal of Economic Literature, 40 , 402–435.

Fussell, P. (1983). Class: A Guide Through the American Status System . Simon & Schuster.

Gilbert, D. T., & Wilson, T. D. (2007). Prospection: Experiencing the future. Science, 317 , 1351–1354.

Glaeser, E. L., Gottlieb, J. D., & Ziv, O. (2016). Unhappy cities. Journal of Labor Economics, 34 (S2), S129–S182.

Goffman, E. (1951). Symbols of class status. The British Journal of Sociology, 2 (4), 294–304.

Hagerty, M. R., & Veenhoven, R. (2003). Wealth and happiness revisited–growing national income does go with greater happiness. Social Indicators Research, 64 (1), 1–27.

Inglehart, R., & Klingemann, H. D. (2000). Genes, culture, democracy, and happiness. In E. Diener & M. Suh (Eds.), Culture and subjective well-being (pp. 165–183). The MIT Press.

Chapter   Google Scholar  

Inkeles, A. (1960). Industrial man: The relation of status to experience, perception, and value. American Journal of Sociology, 66 (1), 1–31.

Jarden, A. (2011, September). Positive psychological assessment: A practical introduction to empirically validated research tools for measuring wellbeing. In 1st New Zealand Association of Positive Psychology Conference , Auckland (pp. 9–10).

Kahneman, D., & Deaton, A. (2010). High income improves evaluation of life but not emotional well-being. Proceedings of the National Academy of Sciences, 107 (38), 16489–16493.

Kahneman, D., & Krueger, A. B. (2006). Development in the measurement of subjective well-being. Journal of Economic Perspectives, 20 (1), 3–24.

Killingsworth, M. A. (2021). Experienced well-being rises with income, even above $75,000 per year. Proceedings of the National Academy of Sciences, 118 (4), e2016976118.

Killingsworth, M. A., Kahneman, D., & Mellers, B. (2023). Income and emotional well-being: A conflict resolved. Proceedings of the National Academy of Sciences, 120 (10), e2208661120.

Klein, E. (2022, July 17) Why a Middle-Class Lifestyle Remains Out of Reach for So Many: Inflation has unmasked the depths of our affordability crisis. New York Times, .

Layard, R. (2006). Happiness and public policy: A challenge to the profession. The Economic Journal, 116 (510), C24–C33.

Levitt, T. (1983). The globalization of markets. Harvard Business Review, 61 , 92–102.

Li, F., Mu, W., Li, S., Li, X., Zhang, J., Chen, C., & Zhou, M. (2022). Income and Subjective Well-being: Test of a Multilevel Moderated Mediation Model. Applied Research in Quality of Life , 1–18.

Lim, H. E., Shaw, D., Liao, P. S., & Duan, H. (2020). The effects of income on happiness in east and south Asia: Societal values matter? Journal of Happiness Studies, 21 (2), 391–415.

MacKerron, G., & Mourato, S. (2020). Mappiness: natural environments and in-the-moment happiness. In Handbook on Wellbeing, Happiness and the Environment (pp. 266–282). Edward Elgar Publishing.

Muresan, G. M., Ciumas, C., & Achim, M. V. (2020). Can money buy happiness? Evidence for European countries. Applied Research in Quality of Life, 15 , 953–970.

Mureșan, G. M., Fülöp, M. T., & Ciumaș, C. (2021). The road from money to happiness. Journal of Risk and Financial Management, 14 (10), 459.

Ng, Y. K. (2002). East-Asian happiness gap. Pacific Economic Review, 7 (1), 51–63.

Ng, W., & Diener, E. (2019). Affluence and subjective well-being: Does income inequality moderate their associations? Applied Research in Quality of Life, 14 (1), 155–170.

Ouweneel, P., and Veenhoven, R. (1991) Cross-national differences in happiness: Cultural bias or societal quality? in Bleichrodt, N & Drenth, P.J. (eds) Contemporary issues in cross-cultural psychology, Swets & Zeitlinger, Amsterdam, 168–184.

Pearlin, L. I., & Schooler, C. (1978). The structure of coping. Journal of Health and Social Behaviors, 19 (1), 2–21.

Rajan, R. (2010). Bernanke Must End Era of Ultra-Low Rates. Financial Times , 28.

Scitovsky, T. (1976). The joyless economy: An inquiry into human satisfaction and consumer dissatisfaction . Oxford U Press.

Stevenson, B., & Wolfers, J. (2008). Economic growth and subjective well-being: Reassessing the Easterlin paradox (No. w14282). National Bureau of Economic Research.

Suranyi-Unger, T., Jr. (1981). Consumer behavior and consumer well-being: An economist’s digest. Journal of Consumer Research, 8 (2), 132–143.

Veenhoven, R. (1991). Is happiness relative? Social Indicators Research, 24 (1), 1–34.

Veenhoven, R., & Hagerty, M. (2006). Rising happiness in nations 1946–2004: A reply to Easterlin. Social Indicators Research, 79 (3), 421–436.

Download references

No funding was received to assist with the preparation of this manuscript.

Author information

Authors and affiliations.

Chaifetz School of Business, Saint Louis University, Saint Louis, MO, USA

James Fisher

Welch College of Business and Technology, Sacred Heart University, Fairfield, CT, USA

Michael Frechette

You can also search for this author in PubMed   Google Scholar


Each author contributed equally to this manuscript.

One more time, does money buy happiness?

Corresponding author

Correspondence to Michael Frechette .

Ethics declarations

Ethics approval.

IRB approval was granted by Saint Louis University, #24311.

Competing Interests

There are no competing interests regarding this manuscript.

As a theoretical paper consent was not relevant to this theoretical manuscript.

No employment was promised for or contingent upon this manuscript.

Additional information

Publisher's note.

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.

Reprints and permissions

About this article

Fisher, J., Frechette, M. One More Time, Does Money Buy Happiness?. Applied Research Quality Life 18 , 3089–3110 (2023).

Download citation

Received : 26 November 2022

Accepted : 28 August 2023

Published : 19 September 2023

Issue Date : December 2023


Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

  • Subjective well-being
  • Find a journal
  • Publish with us
  • Track your research

About Stanford GSB

  • The Leadership
  • Dean’s Updates
  • School News & History
  • Commencement
  • Business, Government & Society
  • Centers & Institutes
  • Center for Entrepreneurial Studies
  • Center for Social Innovation
  • Stanford Seed

About the Experience

  • Learning at Stanford GSB
  • Experiential Learning
  • Guest Speakers
  • Entrepreneurship
  • Social Innovation
  • Communication
  • Life at Stanford GSB
  • Collaborative Environment
  • Activities & Organizations
  • Student Services
  • Housing Options
  • International Students

Full-Time Degree Programs

  • Why Stanford MBA
  • Academic Experience
  • Financial Aid
  • Why Stanford MSx
  • Research Fellows Program
  • See All Programs

Non-Degree & Certificate Programs

  • Executive Education
  • Stanford Executive Program
  • Programs for Organizations
  • The Difference
  • Online Programs
  • Stanford LEAD
  • Seed Transformation Program
  • Aspire Program
  • Seed Spark Program
  • Faculty Profiles
  • Academic Areas
  • Awards & Honors
  • Conferences

Faculty Research

  • Publications
  • Working Papers
  • Case Studies

Research Hub

  • Research Labs & Initiatives
  • Business Library
  • Data, Analytics & Research Computing
  • Behavioral Lab

Research Labs

  • Cities, Housing & Society Lab
  • Golub Capital Social Impact Lab

Research Initiatives

  • Corporate Governance Research Initiative
  • Corporations and Society Initiative
  • Policy and Innovation Initiative
  • Rapid Decarbonization Initiative
  • Stanford Latino Entrepreneurship Initiative
  • Value Chain Innovation Initiative
  • Venture Capital Initiative
  • Career & Success
  • Climate & Sustainability
  • Corporate Governance
  • Culture & Society
  • Finance & Investing
  • Government & Politics
  • Leadership & Management
  • Markets & Trade
  • Operations & Logistics
  • Opportunity & Access
  • Organizational Behavior
  • Political Economy
  • Social Impact
  • Technology & AI
  • Opinion & Analysis
  • Email Newsletter

Welcome, Alumni

  • Communities
  • Digital Communities & Tools
  • Regional Chapters
  • Women’s Programs
  • Identity Chapters
  • Find Your Reunion
  • Career Resources
  • Job Search Resources
  • Career & Life Transitions
  • Programs & Services
  • Career Video Library
  • Alumni Education
  • Research Resources
  • Volunteering
  • Alumni News
  • Class Notes
  • Alumni Voices
  • Contact Alumni Relations
  • Upcoming Events

Admission Events & Information Sessions

  • MBA Program
  • MSx Program
  • PhD Program
  • Alumni Events
  • All Other Events

Research: Can Money Buy Happiness?

In his quarterly column, Francis J. Flynn looks at research that examines how to spend your way to a more satisfying life.

September 25, 2013

A boy holding a toy train

A boy looks at a toy train he received during an annual gift-giving event on Christmas Eve 2011. | Reuters/Jose Luis Gonzalez

What inspires people to act selflessly, help others, and make personal sacrifices? Each quarter, this column features one piece of scholarly research that provides insight on what motivates people to engage in what psychologists call “prosocial behavior” — things like making charitable contributions, buying gifts, volunteering one‘s time, and so forth. In short, it looks at the work of some of our finest researchers on what spurs people to do something on behalf of someone else.

In this column I explore the idea that many of the ways we spend money are prosocial acts — and prosocial expenditures may, in fact, make us happier than personal expenditures. Authors Elizabeth Dunn and Michael Norton discuss evidence for this in their new book, Happy Money: The Science of Smarter Spending . These behavioral scientists show that you can get more out of your money by following several principles — like spending money on others rather than yourself. Moreover, they demonstrate that these principles can be used not only by individuals, but also by companies seeking to create happier employees and more satisfying products.

According to Dunn and Norton, recent research on happiness suggests that the most satisfying way of using money is to invest in others. This can take a seemingly limitless variety of forms, from donating to a charity that helps strangers in a faraway country to buying lunch for a friend.

Witness Bill Gates and Warren Buffet, two of the wealthiest people in the world. On a March day in 2010, they sat in a diner in Carter Lake, Iowa, and hatched a scheme. They would ask America‘s billionaires to pledge the majority of their wealth to charity. Buffet decided to donate 99 percent of his, saying, “I couldn‘t be happier with that decision.”

And what about the rest of us? Dunn and Norton show how we all might learn from that example, regardless of the size of our bank accounts. Research demonstrating that people derive more satisfaction spending money on others than they do spending it on themselves spans poor and rich countries alike, as well as income levels. The authors show how this phenomenon extends over an extraordinary range of circumstances, from a Canadian college student purchasing a scarf for her mother to a Ugandan woman buying lifesaving malaria medication for a friend. Indeed, the benefits of giving emerge among children before the age of two.

Investing in others can make individuals feel healthier and wealthier, even if it means making yourself a little poorer to reap these benefits. One study shows that giving as little as $1 away can cause you to feel more flush.

Quote Investing in others can make you feel healthier and wealthier, even if it means making yourself a little poorer.

Dunn and Norton further discuss how businesses such as PepsiCo and Google and nonprofits such as are harnessing these benefits by encouraging donors, customers, and employees to invest in others. When Pepsi punted advertising at the 2010 Superbowl and diverted funds to supporting grants that would allow people to “refresh” their communities, for example, more public votes were cast for projects than had been cast in the 2008 election. Pepsi got buzz, and the company‘s in-house competition also offering a seed grant boosted employee morale.

Could this altruistic happiness principle be applied to one of our most disputed spheres — paying taxes? As it turns out, countries with more equal distributions of income also tend to be happier. And people in countries with more progressive taxation (such as Sweden and Japan) are more content than those in countries where taxes are less progressive (such as Italy and Singapore). One study indicated that people would be happier about paying taxes if they had more choice as to where their money went. Dunn and Norton thus suggest that if taxes were made to feel more like charitable contributions, people might be less resentful having to pay them.

The researchers persuasively suggest that the proclivity to derive joy from investing in others may well be just a fundamental component of human nature. Thus the typical ratio we all tend to fall into of spending on self versus others — ten to one — may need a shift. Giving generously to charities, friends, and coworkers — and even your country — may well be a productive means of increasing well-being and improving our lives.

Research selected by Francis Flynn, Paul E. Holden Professor of Organizational Behavior at Stanford Graduate School of Business.

For media inquiries, visit the Newsroom .

Explore More

How to “think faster and talk smarter”: a masterclass with matt abrahams, retail investors are making simple — yet costly — mistakes when trading corporate bonds, another price of sloppy bookkeeping: employees want a wage premium., editor’s picks.

can we buy happiness with money essay

  • Priorities for the GSB's Future
  • See the Current DEI Report
  • Supporting Data
  • Research & Insights
  • Share Your Thoughts
  • Search Fund Primer
  • Teaching & Curriculum
  • Affiliated Faculty
  • Faculty Advisors
  • Louis W. Foster Resource Center
  • Defining Social Innovation
  • Impact Compass
  • Global Health Innovation Insights
  • Faculty Affiliates
  • Student Awards & Certificates
  • Changemakers
  • Dean Jonathan Levin
  • Dean Garth Saloner
  • Dean Robert Joss
  • Dean Michael Spence
  • Dean Robert Jaedicke
  • Dean Rene McPherson
  • Dean Arjay Miller
  • Dean Ernest Arbuckle
  • Dean Jacob Hugh Jackson
  • Dean Willard Hotchkiss
  • Faculty in Memoriam
  • Stanford GSB Firsts
  • Certificate & Award Recipients
  • Teaching Approach
  • Analysis and Measurement of Impact
  • The Corporate Entrepreneur: Startup in a Grown-Up Enterprise
  • Data-Driven Impact
  • Designing Experiments for Impact
  • Digital Business Transformation
  • The Founder’s Right Hand
  • Marketing for Measurable Change
  • Product Management
  • Public Policy Lab: Financial Challenges Facing US Cities
  • Public Policy Lab: Homelessness in California
  • Lab Features
  • Curricular Integration
  • View From The Top
  • Formation of New Ventures
  • Managing Growing Enterprises
  • Startup Garage
  • Explore Beyond the Classroom
  • Stanford Venture Studio
  • Summer Program
  • Workshops & Events
  • The Five Lenses of Entrepreneurship
  • Leadership Labs
  • Executive Challenge
  • Arbuckle Leadership Fellows Program
  • Selection Process
  • Training Schedule
  • Time Commitment
  • Learning Expectations
  • Post-Training Opportunities
  • Who Should Apply
  • Introductory T-Groups
  • Leadership for Society Program
  • Certificate
  • 2023 Awardees
  • 2022 Awardees
  • 2021 Awardees
  • 2020 Awardees
  • 2019 Awardees
  • 2018 Awardees
  • Social Management Immersion Fund
  • Stanford Impact Founder Fellowships and Prizes
  • Stanford Impact Leader Prizes
  • Social Entrepreneurship
  • Stanford GSB Impact Fund
  • Economic Development
  • Energy & Environment
  • Stanford GSB Residences
  • Environmental Leadership
  • Stanford GSB Artwork
  • A Closer Look
  • California & the Bay Area
  • Voices of Stanford GSB
  • Business & Beneficial Technology
  • Business & Sustainability
  • Business & Free Markets
  • Business, Government, and Society Forum
  • Get Involved
  • Second Year
  • Global Experiences
  • JD/MBA Joint Degree
  • MA Education/MBA Joint Degree
  • MD/MBA Dual Degree
  • MPP/MBA Joint Degree
  • MS Computer Science/MBA Joint Degree
  • MS Electrical Engineering/MBA Joint Degree
  • MS Environment and Resources (E-IPER)/MBA Joint Degree
  • Academic Calendar
  • Clubs & Activities
  • LGBTQ+ Students
  • Military Veterans
  • Minorities & People of Color
  • Partners & Families
  • Students with Disabilities
  • Student Support
  • Residential Life
  • Student Voices
  • MBA Alumni Voices
  • A Week in the Life
  • Career Support
  • Employment Outcomes
  • Cost of Attendance
  • Knight-Hennessy Scholars Program
  • Yellow Ribbon Program
  • BOLD Fellows Fund
  • Application Process
  • Loan Forgiveness
  • Contact the Financial Aid Office
  • Evaluation Criteria
  • GMAT & GRE
  • English Language Proficiency
  • Personal Information, Activities & Awards
  • Professional Experience
  • Letters of Recommendation
  • Optional Short Answer Questions
  • Application Fee
  • Reapplication
  • Deferred Enrollment
  • Joint & Dual Degrees
  • Entering Class Profile
  • Event Schedule
  • Ambassadors
  • New & Noteworthy
  • Ask a Question
  • See Why Stanford MSx
  • Is MSx Right for You?
  • MSx Stories
  • Leadership Development
  • Career Advancement
  • Career Change
  • How You Will Learn
  • Admission Events
  • Personal Information
  • Information for Recommenders
  • GMAT, GRE & EA
  • English Proficiency Tests
  • After You’re Admitted
  • Daycare, Schools & Camps
  • U.S. Citizens and Permanent Residents
  • Requirements
  • Requirements: Behavioral
  • Requirements: Quantitative
  • Requirements: Macro
  • Requirements: Micro
  • Annual Evaluations
  • Field Examination
  • Research Activities
  • Research Papers
  • Dissertation
  • Oral Examination
  • Current Students
  • Education & CV
  • International Applicants
  • Statement of Purpose
  • Reapplicants
  • Application Fee Waiver
  • Deadline & Decisions
  • Job Market Candidates
  • Academic Placements
  • Stay in Touch
  • Faculty Mentors
  • Current Fellows
  • Standard Track
  • Fellowship & Benefits
  • Group Enrollment
  • Program Formats
  • Developing a Program
  • Diversity & Inclusion
  • Strategic Transformation
  • Program Experience
  • Contact Client Services
  • Campus Experience
  • Live Online Experience
  • Silicon Valley & Bay Area
  • Digital Credentials
  • Faculty Spotlights
  • Participant Spotlights
  • Eligibility
  • International Participants
  • Stanford Ignite
  • Frequently Asked Questions
  • Operations, Information & Technology
  • Classical Liberalism
  • The Eddie Lunch
  • Accounting Summer Camp
  • Videos, Code & Data
  • California Econometrics Conference
  • California Quantitative Marketing PhD Conference
  • California School Conference
  • China India Insights Conference
  • Homo economicus, Evolving
  • Political Economics (2023–24)
  • Scaling Geologic Storage of CO2 (2023–24)
  • A Resilient Pacific: Building Connections, Envisioning Solutions
  • Adaptation and Innovation
  • Changing Climate
  • Civil Society
  • Climate Impact Summit
  • Climate Science
  • Corporate Carbon Disclosures
  • Earth’s Seafloor
  • Environmental Justice
  • Operations and Information Technology
  • Organizations
  • Sustainability Reporting and Control
  • Taking the Pulse of the Planet
  • Urban Infrastructure
  • Watershed Restoration
  • Junior Faculty Workshop on Financial Regulation and Banking
  • Ken Singleton Celebration
  • Marketing Camp
  • Quantitative Marketing PhD Alumni Conference
  • Presentations
  • Theory and Inference in Accounting Research
  • Stanford Closer Look Series
  • Quick Guides
  • Core Concepts
  • Journal Articles
  • Glossary of Terms
  • Faculty & Staff
  • Researchers & Students
  • Research Approach
  • Charitable Giving
  • Financial Health
  • Government Services
  • Workers & Careers
  • Short Course
  • Adaptive & Iterative Experimentation
  • Incentive Design
  • Social Sciences & Behavioral Nudges
  • Bandit Experiment Application
  • Conferences & Events
  • Reading Materials
  • Energy Entrepreneurship
  • Faculty & Affiliates
  • SOLE Report
  • Responsible Supply Chains
  • Current Study Usage
  • Pre-Registration Information
  • Participate in a Study
  • Founding Donors
  • Location Information
  • Participant Profile
  • Network Membership
  • Program Impact
  • Collaborators
  • Entrepreneur Profiles
  • Company Spotlights
  • Seed Transformation Network
  • Responsibilities
  • Current Coaches
  • How to Apply
  • Meet the Consultants
  • Meet the Interns
  • Intern Profiles
  • Collaborate
  • Research Library
  • News & Insights
  • Program Contacts
  • Databases & Datasets
  • Research Guides
  • Consultations
  • Research Workshops
  • Career Research
  • Research Data Services
  • Course Reserves
  • Course Research Guides
  • Material Loan Periods
  • Fines & Other Charges
  • Document Delivery
  • Interlibrary Loan
  • Equipment Checkout
  • Print & Scan
  • MBA & MSx Students
  • PhD Students
  • Other Stanford Students
  • Faculty Assistants
  • Research Assistants
  • Stanford GSB Alumni
  • Telling Our Story
  • Staff Directory
  • Site Registration
  • Alumni Directory
  • Alumni Email
  • Privacy Settings & My Profile
  • Success Stories
  • The Story of Circles
  • Support Women’s Circles
  • Stanford Women on Boards Initiative
  • Alumnae Spotlights
  • Insights & Research
  • Industry & Professional
  • Entrepreneurial Commitment Group
  • Recent Alumni
  • Half-Century Club
  • Fall Reunions
  • Spring Reunions
  • MBA 25th Reunion
  • Half-Century Club Reunion
  • Faculty Lectures
  • Ernest C. Arbuckle Award
  • Alison Elliott Exceptional Achievement Award
  • ENCORE Award
  • Excellence in Leadership Award
  • John W. Gardner Volunteer Leadership Award
  • Robert K. Jaedicke Faculty Award
  • Jack McDonald Military Service Appreciation Award
  • Jerry I. Porras Latino Leadership Award
  • Tapestry Award
  • Student & Alumni Events
  • Executive Recruiters
  • Interviewing
  • Land the Perfect Job with LinkedIn
  • Negotiating
  • Elevator Pitch
  • Email Best Practices
  • Resumes & Cover Letters
  • Self-Assessment
  • Whitney Birdwell Ball
  • Margaret Brooks
  • Bryn Panee Burkhart
  • Margaret Chan
  • Ricki Frankel
  • Peter Gandolfo
  • Cindy W. Greig
  • Natalie Guillen
  • Carly Janson
  • Sloan Klein
  • Sherri Appel Lassila
  • Stuart Meyer
  • Tanisha Parrish
  • Virginia Roberson
  • Philippe Taieb
  • Michael Takagawa
  • Terra Winston
  • Johanna Wise
  • Debbie Wolter
  • Rebecca Zucker
  • Complimentary Coaching
  • Changing Careers
  • Work-Life Integration
  • Career Breaks
  • Flexible Work
  • Encore Careers
  • D&B Hoovers
  • Data Axle (ReferenceUSA)
  • EBSCO Business Source
  • Global Newsstream
  • Market Share Reporter
  • ProQuest One Business
  • Student Clubs
  • Entrepreneurial Students
  • Stanford GSB Trust
  • Alumni Community
  • How to Volunteer
  • Springboard Sessions
  • Consulting Projects
  • 2020 – 2029
  • 2010 – 2019
  • 2000 – 2009
  • 1990 – 1999
  • 1980 – 1989
  • 1970 – 1979
  • 1960 – 1969
  • 1950 – 1959
  • 1940 – 1949
  • Service Areas
  • ACT History
  • ACT Awards Celebration
  • ACT Governance Structure
  • Building Leadership for ACT
  • Individual Leadership Positions
  • Leadership Role Overview
  • Purpose of the ACT Management Board
  • Contact ACT
  • Business & Nonprofit Communities
  • Reunion Volunteers
  • Ways to Give
  • Fiscal Year Report
  • Business School Fund Leadership Council
  • Planned Giving Options
  • Planned Giving Benefits
  • Planned Gifts and Reunions
  • Legacy Partners
  • Giving News & Stories
  • Giving Deadlines
  • Development Staff
  • Submit Class Notes
  • Class Secretaries
  • Board of Directors
  • Health Care
  • Sustainability
  • Class Takeaways
  • All Else Equal: Making Better Decisions
  • If/Then: Business, Leadership, Society
  • Grit & Growth
  • Think Fast, Talk Smart
  • Spring 2022
  • Spring 2021
  • Autumn 2020
  • Summer 2020
  • Winter 2020
  • In the Media
  • For Journalists
  • DCI Fellows
  • Other Auditors
  • Academic Calendar & Deadlines
  • Course Materials
  • Entrepreneurial Resources
  • Campus Drive Grove
  • Campus Drive Lawn
  • CEMEX Auditorium
  • King Community Court
  • Seawell Family Boardroom
  • Stanford GSB Bowl
  • Stanford Investors Common
  • Town Square
  • Vidalakis Courtyard
  • Vidalakis Dining Hall
  • Catering Services
  • Policies & Guidelines
  • Reservations
  • Contact Faculty Recruiting
  • Lecturer Positions
  • Postdoctoral Positions
  • Accommodations
  • CMC-Managed Interviews
  • Recruiter-Managed Interviews
  • Virtual Interviews
  • Campus & Virtual
  • Search for Candidates
  • Think Globally
  • Recruiting Calendar
  • Recruiting Policies
  • Full-Time Employment
  • Summer Employment
  • Entrepreneurial Summer Program
  • Global Management Immersion Experience
  • Social-Purpose Summer Internships
  • Process Overview
  • Project Types
  • Client Eligibility Criteria
  • Client Screening
  • ACT Leadership
  • Social Innovation & Nonprofit Management Resources
  • Develop Your Organization’s Talent
  • Centers & Initiatives
  • Student Fellowships

More Proof That Money Can Buy Happiness (or a Life with Less Stress)

When we wonder whether money can buy happiness, we may consider the luxuries it provides, like expensive dinners and lavish vacations. But cash is key in another important way: It helps people avoid many of the day-to-day hassles that cause stress, new research shows.

Money can provide calm and control, allowing us to buy our way out of unforeseen bumps in the road, whether it’s a small nuisance, like dodging a rainstorm by ordering up an Uber, or a bigger worry, like handling an unexpected hospital bill, says Harvard Business School professor Jon Jachimowicz.

“If we only focus on the happiness that money can bring, I think we are missing something,” says Jachimowicz, an assistant professor of business administration in the Organizational Behavior Unit at HBS. “We also need to think about all of the worries that it can free us from.”

The idea that money can reduce stress in everyday life and make people happier impacts not only the poor, but also more affluent Americans living at the edge of their means in a bumpy economy. Indeed, in 2019, one in every four Americans faced financial scarcity, according to the Board of Governors of the Federal Reserve System. The findings are particularly important now, as inflation eats into the ability of many Americans to afford basic necessities like food and gas, and COVID-19 continues to disrupt the job market.

Buying less stress

The inspiration for researching how money alleviates hardships came from advice that Jachimowicz’s father gave him. After years of living as a struggling graduate student, Jachimowicz received his appointment at HBS and the financial stability that came with it.

“My father said to me, ‘You are going to have to learn how to spend money to fix problems.’” The idea stuck with Jachimowicz, causing him to think differently about even the everyday misfortunes that we all face.

To test the relationship between cash and life satisfaction, Jachimowicz and his colleagues from the University of Southern California, Groningen University, and Columbia Business School conducted a series of experiments, which are outlined in a forthcoming paper in the journal Social Psychological and Personality Science , The Sharp Spikes of Poverty: Financial Scarcity Is Related to Higher Levels of Distress Intensity in Daily Life .

Higher income amounts to lower stress

In one study, 522 participants kept a diary for 30 days, tracking daily events and their emotional responses to them. Participants’ incomes in the previous year ranged from less than $10,000 to $150,000 or more. They found:

  • Money reduces intense stress: There was no significant difference in how often the participants experienced distressing events—no matter their income, they recorded a similar number of daily frustrations. But those with higher incomes experienced less negative intensity from those events.
  • More money brings greater control : Those with higher incomes felt they had more control over negative events and that control reduced their stress. People with ample incomes felt more agency to deal with whatever hassles may arise.
  • Higher incomes lead to higher life satisfaction: People with higher incomes were generally more satisfied with their lives.

“It’s not that rich people don’t have problems,” Jachimowicz says, “but having money allows you to fix problems and resolve them more quickly.”

Why cash matters

In another study, researchers presented about 400 participants with daily dilemmas, like finding time to cook meals, getting around in an area with poor public transportation, or working from home among children in tight spaces. They then asked how participants would solve the problem, either using cash to resolve it, or asking friends and family for assistance. The results showed:

  • People lean on family and friends regardless of income: Jachimowicz and his colleagues found that there was no difference in how often people suggested turning to friends and family for help—for example, by asking a friend for a ride or asking a family member to help with childcare or dinner.
  • Cash is the answer for people with money: The higher a person’s income, however, the more likely they were to suggest money as a solution to a hassle, for example, by calling an Uber or ordering takeout.

While such results might be expected, Jachimowicz says, people may not consider the extent to which the daily hassles we all face create more stress for cash-strapped individuals—or the way a lack of cash may tax social relationships if people are always asking family and friends for help, rather than using their own money to solve a problem.

“The question is, when problems come your way, to what extent do you feel like you can deal with them, that you can walk through life and know everything is going to be OK,” Jachimowicz says.

Breaking the ‘shame spiral’

In another recent paper , Jachimowicz and colleagues found that people experiencing financial difficulties experience shame, which leads them to avoid dealing with their problems and often makes them worse. Such “shame spirals” stem from a perception that people are to blame for their own lack of money, rather than external environmental and societal factors, the research team says.

“We have normalized this idea that when you are poor, it’s your fault and so you should be ashamed of it,” Jachimowicz says. “At the same time, we’ve structured society in a way that makes it really hard on people who are poor.”

For example, Jachimowicz says, public transportation is often inaccessible and expensive, which affects people who can’t afford cars, and tardy policies at work often penalize people on the lowest end of the pay scale. Changing those deeply-engrained structures—and the way many of us think about financial difficulties—is crucial.

After all, society as a whole may feel the ripple effects of the financial hardships some people face, since financial strain is linked with lower job performance, problems with long-term decision-making, and difficulty with meaningful relationships, the research says. Ultimately, Jachimowicz hopes his work can prompt thinking about systemic change.

“People who are poor should feel like they have some control over their lives, too. Why is that a luxury we only afford to rich people?” Jachimowicz says. “We have to structure organizations and institutions to empower everyone.”

[Image: iStockphoto/mihtiander]

Related reading from the Working Knowledge Archives

Selling Out The American Dream

  • 09 Apr 2024

Why Work Rituals Bring Teams Together and Create More Meaning

  • 24 Jan 2024

Why Boeing’s Problems with the 737 MAX Began More Than 25 Years Ago

  • 02 Apr 2024
  • What Do You Think?

What's Enough to Make Us Happy?

  • 25 Feb 2019
  • Research & Ideas

How Gender Stereotypes Kill a Woman’s Self-Confidence

  • 25 Jan 2022

Jon M. Jachimowicz

  • Social Psychology

Sign up for our weekly newsletter

  • Share full article


Supported by

Guest Essay

The Nobel Winner Who Liked to Collaborate With His Adversaries

A colorful illustration of two identical-looking youths in a bucolic setting. One is in red overalls and is before a red lawnmower, and the other is in blue overalls and is before a blue lawnmower. They are glaring at each other, and each has a foot pressed against the other’s. The two lawnmowers have carved a circle in the grass.

By Cass R. Sunstein

Mr. Sunstein is a law professor at Harvard and an author of “Noise,” with Daniel Kahneman and Olivier Sibony.

Our all-American belief that money really does buy happiness is roughly correct for about 85 percent of us. We know this thanks to the latest and perhaps final work of Daniel Kahneman, the Nobel Prize winner who insisted on the value of working with those with whom we disagree.

Professor Kahneman, who died last week at the age of 90, is best known for his pathbreaking explorations of human judgment and decision making and of how people deviate from perfect rationality. He should also be remembered for a living and working philosophy that has never been more relevant: his enthusiasm for collaborating with his intellectual adversaries. This enthusiasm was deeply personal. He experienced real joy working with others to discover the truth, even if he learned that he was wrong (something that often delighted him).

Back to that finding, published last year , that for a strong majority of us, more is better when it comes to money. In 2010, Professor Kahneman and the Princeton economist Angus Deaton (also a Nobel Prize winner) published a highly influential essay that found that, on average, higher-income groups show higher levels of happiness — but only to a point. Beyond a threshold at or below $90,000, Professor Kahneman and Professor Deaton found, there is no further progress in average happiness as income increases.

Eleven years later, Matthew Killingsworth, a senior fellow at the Wharton School of the University of Pennsylvania, found exactly the opposite : People with higher income reported higher levels of average happiness. Period. The more money people have, the happier they are likely to be.

What gives? You could imagine some furious exchange in which Professor Kahneman and Professor Deaton made sharp objections to Dr. Killingsworth’s paper, to which Dr. Killingsworth answered equally sharply, leaving readers confused and exhausted.

Professor Kahneman saw such a dynamic as “angry science,” which he described as a “nasty world of critiques, replies and rejoinders” and “as a contest, where the aim is to embarrass.” As Professor Kahneman put it, those who live in that nasty world offer “a summary caricature of the target position, refute the weakest argument in that caricature and declare the total destruction of the adversary’s position.” In his account, angry science is “a demeaning experience.” That dynamic might sound familiar, particularly in our politics.

Instead, Professor Kahneman favored an alternative that he termed “adversarial collaboration.” When people who disagree work together to test a hypothesis, they are involved in a common endeavor. They are trying not to win but to figure out what’s true. They might even become friends.

In that spirit, Professor Kahneman, well into his 80s, asked Dr. Killingsworth to collaborate, with the help of a friendly arbiter, Prof. Barbara Mellers, an influential and widely admired psychologist. Their task was to look closely at Dr. Killingsworth’s data to see whether he had analyzed it properly and to understand what, if anything, had been missed by Professor Kahneman and Professor Deaton.

Their central conclusion was simple. Dr. Killingsworth missed a threshold effect in his data that affected only one group: the least happy 15 percent. For these largely unhappy people, average happiness does grow with rising income, up to a level of around $100,000, but it stops growing after that. For a majority of us, by contrast, average happiness keeps growing with increases in income.

Both sides were partly right and partly wrong. Their adversarial collaboration showed that the real story is more interesting and more complicated than anyone saw individually.

Professor Kahneman engaged in a number of adversarial collaborations, with varying degrees of success. His first (and funniest) try was with his wife, the distinguished psychologist Anne Treisman. Their disagreement never did get resolved. (Dr. Treisman died in 2018.) Both of them were able to explain away the results of their experiments — a tribute to what he called “the stubborn persistence of challenged beliefs.” Still, adversarial collaborations sometimes produce both agreement and truth, and he said that “a common feature of all my experiences has been that the adversaries ended up on friendlier terms than they started.”

Professor Kahneman meant both to encourage better science and to strengthen the better angels of our nature. In academic life, adversarial collaborations hold great value . We could easily imagine a situation in which adversaries routinely collaborated to see if they could resolve disputes about the health effects of air pollutants, the consequences of increases in the minimum wage, the harms of climate change or the deterrent effects of the death penalty.

And the idea can be understood more broadly. In fact, the U.S. Constitution should be seen as an effort to create the conditions for adversarial collaboration. Before the founding, it was often thought that republics could work only if people were relatively homogeneous — if they were broadly in agreement with one another. Objecting to the proposed Constitution, the pseudonymous antifederalist Brutus emphasized this point: “In a republic, the manners, sentiments and interests of the people should be similar. If this be not the case, there will be a constant clashing of opinions, and the representatives of one part will be continually striving against those of the other.”

Those who favored the Constitution thought that Brutus had it exactly backward. In their view, the constant clashing of opinions was something not to fear but to welcome, at least if people collaborate — if they act as if they are engaged in a common endeavor. Sounding a lot like Professor Kahneman, Alexander Hamilton put it this way : “The differences of opinion, and the jarrings of parties” in the legislative department of the government “often promote deliberation and circumspection and serve to check excesses in the majority.”

Angry science is paralleled by angry democracy, a “nasty world of critiques, replies and rejoinders,” whose “aim is to embarrass,” Professor Kahneman said. That’s especially true, of course, in the midst of political campaigns, when the whole point is to win.

Still, the idea of adversarial collaboration has never been more important. Within organizations of all kinds — including corporations, nonprofits, think tanks and government agencies — sustained efforts should be made to lower the volume by isolating the points of disagreement and specifying tests to establish what’s right. Asking how a disagreement might actually be resolved tends to turn enemies, focused on winning and losing, into teammates, focused on truth.

As usual, Professor Kahneman was right. We could use a lot more of that.

Cass R. Sunstein is a law professor at Harvard and an author of “Noise,” with Daniel Kahneman and Olivier Sibony.

The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips . And here’s our email: [email protected] .

Follow the New York Times Opinion section on Facebook , Instagram , TikTok , WhatsApp , X and Threads .

Money can buy happiness: Here's how much you need and how to spend it, according to a financial therapist

  • Money can buy happiness up to a point — studies indicate emotional well-being rises with income up to about $75,000.
  • Researchers have also found that experiences make people happier because they enhance social relationships and are a bigger part of one's identity.
  • Spending money on experiences or items that align with your values can increase your potential for happiness.
  • This article was  medically reviewed  by  Alisa Ruby Bash , PsyD, LMFT, in Malibu, California. 

Insider Today

You know the phrase: money can't buy happiness. It turns out, that's not entirely true. Money can buy a certain degree of life satisfaction, depending on how much wealth you have and how you spend it. 

Research shows that emotional well-being rises along with income, up to a point. A 2010 study looked at surveys of 450,000 Americans and found that participants with higher incomes reported higher emotional well-being, up to an annual income of $75,000. After that, it drops off. 

Beyond simply having money, here's why being able to meet your basic needs, enjoying life experiences, and having social ties are also important factors for satisfaction and happiness in life.

Basic Needs

Lindsay Bryan-Podvin, LMSW , a financial therapist and author of "The Financial Anxiety Solution" says an annual income of $75,000 may not be the threshold for everyone. Being able to meet basic needs like food, housing, and healthcare are top priorities.  Then, the amount of satisfaction derived from income varies depending on factors like the cost of living in your area and your personal interests.

"The data is pretty clear that when we can financially take care of ourselves, our mental health is better," says Bryan-Podvin. "It's stressful to be on the grind all the time."

In fact, according to the CDC , adults living below the poverty level were three to four times more likely to have depression than adults living at or above the poverty level. 

The ability to meet basic needs without working multiple jobs also means you are more likely to have time for your friends and family, which is important for happiness. A Harvard study , which started in 1938 and tracked hundreds of men for nearly 80 years, collected data on both physical and mental well-being. The researchers found that close relationships, more than money or fame, keep people happy throughout their lives. 

Experience vs materials

Once you cover basic needs, whether money buys happiness may depend on what you spend it on, says Bryan-Podvin. 

There is a common theory that spending money on experiences will make you happier than spending money on material objects. Some studies back this up. A 2014 review found that experiences make people happier because they enhance social relationships, are a bigger part of one's identity, and are less likely to be compared to other people's experiences. 

A poll of more than 2,000 millennials in 2014 found that 78% prefer spending money on experiences or events compared to a material object. It's not just millennials. The same poll found that consumer spending on experience and events is up 70% since 1987. 

For some people, though, it may be buying a tangible item that brings the most happiness. "What research shows is if we have a very strong affinity for something, then we do get a lot of happiness out of buying that thing," says Bryan-Podvin, who gives the example of someone passionate about cars. 

When money doesn't buy happiness

One reason more money doesn't always equal more happiness is a tendency for what Bryan-Podvin calls "lifestyle creep." Meaning that when you are making more money, your expenses often go up.

For instance, you may end up spending money on things like a country club membership or dinners at more expensive restaurants. If this is happening, you may not feel like you don't have enough money even though you are making a substantial salary.  

Happiness also depends on how much you have to work to make that money. "You might be pulling in $300,000, which sounds great in theory, but if you are working 80 hours a week and can't enjoy the money you are earning, then what is the point?" says Bryan-Podvin. 

Bottom line

How much money a person needs to be happy varies. Happiness may depend on how much money is required to cover your own basic needs and what brings you joy personally.

For one person, that might be season tickets to the Yankees. For someone else, it might be a massage once a month or a new pair of running shoes. 

Ultimately, money can increase the potential for life satisfaction, depending on how you spend it. If you spend money on experiences or items that align with your values, you will increase your happiness, says Bryan-Podvin.

Related articles from Health Reference:

  • How to increase dopamine levels and feel like your best self
  • The best exercises to battle depression
  • How to get better sleep with anxiety or stress, in 5 different ways
  • The 5 types of anxiety disorder and how to know if you have one
  • 5 benefits of green tea and how it can help your memory, skin, and bones

can we buy happiness with money essay

  • Main content

Home — Essay Samples — Philosophy — Philosophy of Life — Money Doesn’t Always Buy Happiness


Money Doesn't Always Buy Happiness

  • Categories: Money and Class in America Philosophy of Life Social Justice

About this sample


Words: 606 |

Published: Mar 16, 2024

Words: 606 | Page: 1 | 4 min read

Table of contents

The relationship between money and happiness, the limits of wealth, alternative paths to happiness.

Image of Dr. Charlotte Jacobson

Cite this Essay

Let us write you an essay from scratch

  • 450+ experts on 30 subjects ready to help
  • Custom essay delivered in as few as 3 hours

Get high-quality help


Prof. Kifaru

Verified writer

  • Expert in: Literature Philosophy Sociology


+ 120 experts online

By clicking “Check Writers’ Offers”, you agree to our terms of service and privacy policy . We’ll occasionally send you promo and account related email

No need to pay just yet!

Related Essays

1 pages / 502 words

1 pages / 670 words

2 pages / 1128 words

4 pages / 1689 words

Remember! This is just a sample.

You can get your custom paper by one of our expert writers.

121 writers online

Still can’t find what you need?

Browse our vast selection of original essay samples, each expertly formatted and styled

Related Essays on Philosophy of Life

Escapism is a phenomenon deeply ingrained in human nature, offering a respite from the complexities and challenges of everyday life. The desire to retreat into alternate realities, whether through literature, entertainment, or [...]

The Christian worldview is rooted in the belief that the Bible is the inspired word of God and serves as the ultimate authority in matters of faith and practice. Within this framework, there are certain essential beliefs known [...]

Suffering is a universal human experience that has been a topic of philosophical and theological debate for centuries. While many view suffering as a negative aspect of life to be avoided at all costs, others argue that it plays [...]

Life is how we go about day by day, month by month, year by year. Our actions, even the slightest, can twist and turn our paths like a labyrinth. Life is quite unpredictable, though it is what we make of it. Whatever happens in [...]

In this paper I shall briefly define what induction is and attempt to explain David Hume’s problem of induction through examining the thre most common problems of induction, which are, the problem of the uniformity of nature, [...]

As we learned in earlier weeks, there are two views on the self. The avocado view and the artichoke view. As we all know An avocado is a pear-shaped fruit with a rough leathery skin, smooth oily edible flesh, and a large stone. [...]

Related Topics

By clicking “Send”, you agree to our Terms of service and Privacy statement . We will occasionally send you account related emails.

Where do you want us to send this sample?

By clicking “Continue”, you agree to our terms of service and privacy policy.

Be careful. This essay is not unique

This essay was donated by a student and is likely to have been used and submitted before

Download this Sample

Free samples may contain mistakes and not unique parts

Sorry, we could not paraphrase this essay. Our professional writers can rewrite it and get you a unique paper.

Please check your inbox.

We can write you a custom essay that will follow your exact instructions and meet the deadlines. Let's fix your grades together!

Get Your Personalized Essay in 3 Hours or Less!

We use cookies to personalyze your web-site experience. By continuing we’ll assume you board with our cookie policy .

  • Instructions Followed To The Letter
  • Deadlines Met At Every Stage
  • Unique And Plagiarism Free

can we buy happiness with money essay

I Don’t Believe Money Can Buy Happiness Essay

Happiness is very essential in each and everyone’s life as it makes life enjoyable and motivates someone to move on. There are many factors that contribute to an individual’s happiness, for instance, satisfaction in one’s family life, work, love relationships and even good academic performance.

Money is also a contributing factor but only when combined with other aspects like mentioned above. This paper gives an insight on why I don’t believe that money can buy happiness. I don’t believe that money can buy happiness since some aspects that leads to happiness for example respect, power love and a feeling of appreciation and belonging cannot be bought but rather attained naturally.

The more one earns, the more the needs that are to be satisfied and so money is essential to a certain level after which it becomes a problem and make people less approachable and more egocentric affecting their social life negatively hence hindering happiness in their lives. Money also impairs people ability to enjoy life and the many things they have acquired through their wealth despite being in a better position to purchase items of choice because life’s little pleasures are overlooked.

Money helps us to have a comfortable life as we can be able to cater for our needs but it surely cannot buy us happiness. This is because happiness in our lives is brought about by the little pleasures that life holds for us for example the joy attained through socialization with others, satisfaction in work and family life among others and not in the big pleasures attached to wealth and money.

Materialistic people are generally unhappy as they tend to ignore the little things that bring about happiness in life in search of bigger things with the hope of being happier which does not come to pass.

According to Luscombe (2010), money contributes happiness when it is acquired to a certain amount ($ 75,000) in a year after which no greater happiness is attached to the money. He argues that the lower an individual’s income falls below $75,000 per year, the unhappier he or she may be but at the same time, earning more than this does not guarantee any much happiness.

This shows that as much as money is essential in acquisition and satisfaction of our needs, it does not guarantee our happiness by its own and other aspects of life have to be incorporated to attain happiness.

Happiness can be viewed as the way one feels at a particular moment for example either emotionally well or not. It can also be viewed as the inner satisfaction an individual feels about his or her life in general in regard to what is happening. Money seems to make life appear to be working out well but it actually does not contribute to a person’s emotional well being that leads to total happiness.

Lower income does not in itself lead to sadness but make people stressed up by the problems that face them. For instance those with family problems like those who are sick, separated or divorced are not happy irrespective of the amount of income they earn hence money just help improve living conditions and brings a person to a life he or she thinks is better but do not necessarily lead to happiness.

There is more to happiness than money and there are people who are without money but are happier than those with lots of money depending on the circumstances that face them and the conditions in which they live.

People who delight in their work for example those who are involved in more social work and lot of human contact seem to achieve much higher levels of happiness as compared to those whose work involves dealing with machines and less human interaction since there is a good feeling that comes along with sharing of experiences, ideas and opinions with others.

For example hairdressers, doctors, nurses, teachers and social workers tend to be happier due to the strong social relations they develop in their work between their colleagues and also with their clients. This shows that although income matters, our attitude towards life is essential plus the consideration of other factors that may lead to our happiness like love, respect and recognition.

The key issue towards attainment of happiness is the ability to have just enough money to cater for the basic needs for instance food, clothing, shelter and health and some little more for emergency and concentrating on how you spend your time and not what you can acquire.

One should work on his or her strengths, purpose, the people and things that make life worth living and not on the items perceived to bring happiness but in reality do not. This is because happiness is an attitude and making enough to facilitate basic needs and a little surplus creates some peace of mind hence happiness and lack of it causes pain and stress as one tries to make ends meet.

Luscombe, B. (2010). Do We Need $75,000 a Year to Be Happy? . Web.

  • Chicago (A-D)
  • Chicago (N-B)

IvyPanda. (2023, December 26). I Don't Believe Money Can Buy Happiness.

"I Don't Believe Money Can Buy Happiness." IvyPanda , 26 Dec. 2023,

IvyPanda . (2023) 'I Don't Believe Money Can Buy Happiness'. 26 December.

IvyPanda . 2023. "I Don't Believe Money Can Buy Happiness." December 26, 2023.

1. IvyPanda . "I Don't Believe Money Can Buy Happiness." December 26, 2023.


IvyPanda . "I Don't Believe Money Can Buy Happiness." December 26, 2023.

  • Making a Happier Military
  • Thanks!: How Practicing Gratitude Can Make You Happier by Robert Emmons
  • How to Live a Happy Life: 101 Ways to Be Happier
  • How to Be Happier
  • Pets’ Adoption: Cats Make This Life Happier
  • Whether Housewives Happier than Full-time Working Mothers
  • Connection Between Money and Happiness
  • Money and Happiness in Poor and Wealthy Societies
  • The idea of Happiness
  • Roots and Fruits of Happiness
  • Art Therapy: Practice and Challenges
  • Sleep Process Research
  • Cognitive Behavioral Therapy in Treating Depression
  • Psychological Tests in Employee Selection Process
  • Electroconvulsive Therapy (ECT)


Essay on Money Can’t Buy Happiness

Students are often asked to write an essay on Money Can’t Buy Happiness in their schools and colleges. And if you’re also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic.

Let’s take a look…

100 Words Essay on Money Can’t Buy Happiness

The meaning of happiness.

Happiness is a feeling of joy that comes from within. It’s when we feel good about our lives and the people around us. It’s not something you can go to a store and buy like a toy or a candy bar.

Money’s Role

Money is useful. It helps us buy things we need like food and a home. It can also help us have fun, like when we buy a game or go on a trip. But these things only make us happy for a short time.

Riches and Smiles

Some rich people have lots of money but are not happy. They may feel lonely or worried. This shows us that even with all the money in the world, you can’t buy a happy heart.

Lasting Joy

True happiness comes from love, friendship, and good memories. These are things that money can’t buy. Doing kind things for others or spending time with family and friends makes us truly happy.

Also check:

  • Speech on Money Can’t Buy Happiness

250 Words Essay on Money Can’t Buy Happiness

What is true happiness.

True happiness is a feeling of joy, contentment, and well-being that comes from within. It’s not something you can pick up from a store or order online. Happiness is about feeling good inside your heart and mind, not about how much stuff you have.

Money and Things

Money can buy a lot of things like toys, games, and candy. But these things only make us happy for a little while. After some time, new toys become old, and the excitement fades. The joy that comes from things you can touch and buy does not last forever.

Love and Friendship

Think about the times you laugh with your friends or get a hug from your family. These moments give you a warm feeling that stays with you much longer than the happiness you get from a new toy. Love and friendship are priceless, and you cannot buy them with money.

Helping Others

Have you ever helped someone and seen them smile because of what you did? This kind of joy comes from giving, not getting. When you help others, you feel good on the inside. You can’t put a price tag on the happiness that comes from being kind.

The Simple Things

Often, the best things in life are free. Playing outside, talking with friends, or reading a good story can make you very happy. These simple pleasures do not cost anything, yet they fill us with happiness.

In conclusion, money is useful for buying things we need, but it cannot buy true happiness. Happiness is about love, friendship, kindness, and enjoying the simple things in life. These are treasures that money can never buy.

500 Words Essay on Money Can’t Buy Happiness

The meaning of true happiness.

Many people think that having a lot of money means you will be happy. They believe that when you are rich, you can buy anything you want, and that will make you happy. But true happiness is not something you can buy with money. True happiness comes from love, good health, and being content with what you have.

Love and Relationships

Think about the times you feel the happiest. Is it when you get a new toy, or is it when you are playing with your friends? For most of us, being with our family and friends makes us feel good. Laughing, playing games, and sharing stories are moments that make us happy. These moments do not cost anything. Money cannot buy the love of your family or the fun times with your friends.

Health is Wealth

Being healthy is very important for happiness. Sometimes, rich people are not healthy. They may have money to go to the best doctors, but they cannot buy good health. Eating well, getting enough sleep, and playing outside can keep you healthy. These things are better than any medicine and they do not need a lot of money.

Contentment is Key

Contentment means being happy with what you have. It does not matter if you do not have the newest video game or the latest sneakers. Being thankful for what you have is a big part of being happy. If you always want more, you will never be happy. Even if you have a lot of money, you will always be looking for the next thing to buy. But if you are content, you can find joy in the simple things in life.

The Best Things in Life Are Free

Some of the best things in life do not cost any money at all. Watching the sunset, playing in the park, and reading a good book are things that can make you very happy. You do not need to spend money to enjoy these things. Nature, art, and imagination are always there for you to enjoy.

Money and Happiness

Money can help you live comfortably. It can buy you a home, food, and clothes. But after your basic needs are met, more money does not mean more happiness. People with less money can be just as happy, or even happier, than rich people. When you have a lot of money, you might worry about it too much. You might be afraid of losing it or think about how to make more. This can make you feel stressed and not happy.

In conclusion, happiness is not something you can buy at a store. It comes from love, health, being content, and enjoying the simple things. Remember, the most precious moments in life are often the ones that money cannot buy. So, smile, play, and enjoy every day, and you will find that happiness is all around you.

That’s it! I hope the essay helped you.

If you’re looking for more, here are essays on other interesting topics:

  • Essay on Money Can Buy Happiness
  • Essay on Money And Trees
  • Essay on Money And Politics

Apart from these, you can look at all the essays by clicking here .

Happy studying!

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

Jade Wu Ph.D.

Can Money Really Buy Happiness?

Money and happiness are related—but not in the way you think..

Updated November 10, 2023 | Reviewed by Chloe Williams

  • More money is linked to increased happiness, some research shows.
  • People who won the lottery have greater life satisfaction, even years later.
  • Wealth is not associated with happiness globally; non-material things are more likely to predict wellbeing.
  • Money, in and of itself, cannot buy happiness, but it can provide a means to the things we value in life.

Money is a big part of our lives, our identities, and perhaps our well-being. Sometimes, it can feel like your happiness hinges on how much cash is in your bank account. Have you ever thought to yourself, “If only I could increase my salary by 12 percent, I’d feel better”? How about, “I wish I had an inheritance. How easier life would be!” I don’t blame you — I’ve had the same thoughts many times.

But what does psychological research say about the age-old question: Can money really buy happiness? Let’s take a brutally honest exploration of how money and happiness are (and aren’t) related. (Spoiler alert: I’ve got bad news, good news, and lots of caveats.)

Higher earners are generally happier

Over 10 years ago, a study based on Gallup Poll data on 1,000 people made a big headline in the news. It found that people with higher incomes report being happier... but only up to an annual income of $75,000 (equivalent to about $90,000 today). After this point, a high emotional well-being wasn’t directly correlated to more money. This seemed to show that once a persons’ basic (and some “advanced”) needs are comfortably met, more money isn’t necessary for well-being.

Shift Drive / Shutterstock

But a new 2021 study of over one million participants found that there’s no such thing as an inflection point where more money doesn’t equal more happiness, at least not up to an annual salary of $500,000. In this study, participants’ well-being was measured in more detail. Instead of being asked to remember how well they felt in the past week, month, or year, they were asked how they felt right now in the moment. And based on this real-time assessment, very high earners were feeling great.

Similarly, a Swedish study on lottery winners found that even after years, people who won the lottery had greater life satisfaction, mental health, and were more prepared to face misfortune like divorce , illness, and being alone than regular folks who didn’t win the lottery. It’s almost as if having a pile of money made those things less difficult to cope with for the winners.

Evaluative vs. experienced well-being

At this point, it's important to suss out what researchers actually mean by "happiness." There are two major types of well-being psychologists measure: evaluative and experienced. Evaluative well-being refers to your answer to, “How do you think your life is going?” It’s what you think about your life. Experienced well-being, however, is your answer to, “What emotions are you feeling from day to day, and in what proportions?” It is your actual experience of positive and negative emotions.

In both of these studies — the one that found the happiness curve to flatten after $75,000 and the one that didn't — the researchers were focusing on experienced well-being. That means there's a disagreement in the research about whether day-to-day experiences of positive emotions really increase with higher and higher incomes, without limit. Which study is more accurate? Well, the 2021 study surveyed many more people, so it has the advantage of being more representative. However, there is a big caveat...

Material wealth is not associated with happiness everywhere in the world

If you’re not a very high earner, you may be feeling a bit irritated right now. How unfair that the rest of us can’t even comfort ourselves with the idea that millionaires must be sad in their giant mansions!

But not so fast.

Yes, in the large million-person study, experienced well-being (aka, happiness) did continually increase with higher income. But this study only included people in the United States. It wouldn't be a stretch to say that our culture is quite materialistic, more so than other countries, and income level plays a huge role in our lifestyle.

Another study of Mayan people in a poor, rural region of Yucatan, Mexico, did not find the level of wealth to be related to happiness, which the participants had high levels of overall. Separately, a Gallup World Poll study of people from many countries and cultures also found that, although higher income was associated with higher life evaluation, it was non-material things that predicted experienced well-being (e.g., learning, autonomy, respect, social support).

Earned wealth generates more happiness than inherited wealth

More good news: For those of us with really big dreams of “making it” and striking it rich through talent and hard work, know that the actual process of reaching your dream will not only bring you cash but also happiness. A study of ultra-rich millionaires (net worth of at least $8,000,000) found that those who earned their wealth through work and effort got more of a happiness boost from their money than those who inherited it. So keep dreaming big and reaching for your entrepreneurial goals … as long as you’re not sacrificing your actual well-being in the pursuit.

can we buy happiness with money essay

There are different types of happiness, and wealth is better for some than others

We’ve been talking about “happiness” as if it’s one big thing. But happiness actually has many different components and flavors. Think about all the positive emotions you’ve felt — can we break them down into more specifics? How about:

  • Contentment
  • Gratefulness

...and that's just a short list.

It turns out that wealth may be associated with some of these categories of “happiness,” specifically self-focused positive emotions such as pride and contentment, whereas less wealthy people have more other-focused positive emotions like love and compassion.

In fact, in the Swedish lottery winners study, people’s feelings about their social well-being (with friends, family, neighbors, and society) were no different between lottery winners and regular people.

Money is a means to the things we value, not happiness itself

One major difference between lottery winners and non-winners, it turns out, is that lottery winners have more spare time. This is the thing that really makes me envious , and I would hypothesize that this is the main reason why lottery winners are more satisfied with their life.

Consider this simply: If we had the financial security to spend time on things we enjoy and value, instead of feeling pressured to generate income all the time, why wouldn’t we be happier?

This is good news. It’s a reminder that money, in and of itself, cannot literally buy happiness. It can buy time and peace of mind. It can buy security and aesthetic experiences, and the ability to be generous to your family and friends. It makes room for other things that are important in life.

In fact, the researchers in that lottery winner study used statistical approaches to benchmark how much happiness winning $100,000 brings in the short-term (less than one year) and long-term (more than five years) compared to other major life events. For better or worse, getting married and having a baby each give a bigger short-term happiness boost than winning money, but in the long run, all three of these events have the same impact.

What does this mean? We make of our wealth and our life what we will. This is especially true for the vast majority of the world made up of people struggling to meet basic needs and to rise out of insecurity. We’ve learned that being rich can boost your life satisfaction and make it easier to have positive emotions, so it’s certainly worth your effort to set goals, work hard, and move towards financial health.

But getting rich is not the only way to be happy. You can still earn health, compassion, community, love, pride, connectedness, and so much more, even if you don’t have a lot of zeros in your bank account. After all, the original definition of “wealth” referred to a person’s holistic wellness in life, which means we all have the potential to be wealthy... in body, mind, and soul.

Kahneman, D., & Deaton, A.. High income improves evaluation of life but not emotional well-being. . Proceedings of the national academy of sciences. 2010.

Killingsworth, M. A. . Experienced well-being rises with income, even above $75,000 per year .. Proceedings of the National Academy of Sciences. 2021.

Lindqvist, E., Östling, R., & Cesarini, D. . Long-run effects of lottery wealth on psychological well-being. . The Review of Economic Studies. 2020.

Guardiola, J., González‐Gómez, F., García‐Rubio, M. A., & Lendechy‐Grajales, Á.. Does higher income equal higher levels of happiness in every society? The case of the Mayan people. . International Journal of Social Welfare. 2013.

Diener, E., Ng, W., Harter, J., & Arora, R. . Wealth and happiness across the world: material prosperity predicts life evaluation, whereas psychosocial prosperity predicts positive feeling. . Journal of personality and social psychology. 2010.

Donnelly, G. E., Zheng, T., Haisley, E., & Norton, M. I.. The amount and source of millionaires’ wealth (moderately) predict their happiness . . Personality and Social Psychology Bulletin. 2018.

Piff, P. K., & Moskowitz, J. P. . Wealth, poverty, and happiness: Social class is differentially associated with positive emotions.. Emotion. 2018.

Jade Wu Ph.D.

Jade Wu, Ph.D., is a clinical health psychologist and host of the Savvy Psychologist podcast. She specializes in helping those with sleep problems and anxiety disorders.

  • Find a Therapist
  • Find a Treatment Center
  • Find a Support Group
  • International
  • New Zealand
  • South Africa
  • Switzerland
  • Asperger's
  • Bipolar Disorder
  • Chronic Pain
  • Eating Disorders
  • Passive Aggression
  • Personality
  • Goal Setting
  • Positive Psychology
  • Stopping Smoking
  • Low Sexual Desire
  • Relationships
  • Child Development
  • Therapy Center NEW
  • Diagnosis Dictionary
  • Types of Therapy

March 2024 magazine cover

Understanding what emotional intelligence looks like and the steps needed to improve it could light a path to a more emotionally adept world.

  • Coronavirus Disease 2019
  • Affective Forecasting
  • Neuroscience

Can Money Buy Happiness Argumentative Essay, With Outline

Published by Boni on February 21, 2022 February 21, 2022

Can Money Buy Happiness Argumentative Essay Outline

Can money buy happiness? A question we ask ourselves everyday but when it comes to writing essays on the subject, the best solution is finding cheap research papers online where you can get a uniquely customized essay that will get you good grades.

Elevate Your Writing with Our Free Writing Tools!

Did you know that we provide a free essay and speech generator, plagiarism checker, summarizer, paraphraser, and other writing tools for free?


Thesis: Money can buy happiness as it reduces stress, enables control, and enables spending on others.

Paragraph 1:

Money can help one reduce or relieve intense stress.

  • People with higher incomes experience less negative intensity from distressing events.
  • The higher the income, the lower the intensity of stress one may undergo regardless of the circumstances.
  • With reduced stress, one is likely to experience happiness as they do not have to develop negative thoughts.

Perhaps you maybe interested on learning how to write descriptive essays about the beach .

Paragraph 2:

Money enables one to exercise greater control over their life.

  • One can largely determine the direction their life takes by spending large amounts of money.
  • They can access more leisure time, fulfilling work, better nutrition and healthcare, and homes in friendly and safer neighborhoods.
  • Satisfaction of human wants forms part of what one needs in order to be happy.

Paragraph 3:

Money makes it possible for a person to attain happiness by spending on other people.

  • People experience high happiness levels by donating their annual bonus to charitable organizations or spending it on other people.
  • Giving to others, or lending a helping hand, makes human beings develop a good feeling about themselves.
  • People have to have enough for themselves first before they can consider giving.

Paragraph 4:

Some people may argue that people need family and friends more than they need money for happiness.

  • This may be true to some extent as people often turn to family and friends for various kinds of help.
  • However, without good income, one cannot offer meaningful help to another person.
  • One can also be happy even without depending so much on their family and friends if they have good income.

Read an essay on The Divine Comedy by Dante Aligheri that tells a fictional story that takes the audience through the nine levels of hell.

  • Money can buy happiness because with it, one experiences less stress, exercises control over their life, and can easily spend on other people.
  • Less stress attracts more happiness while control over one’s life gives them immense satisfaction.
  • Being able to help other people in terms of money makes one feel good about oneself.
  • Therefore, it is not true that money cannot buy happiness.

Can Money Buy Happiness Argumentative Essay

It is often said that “ money cannot buy happiness .”This phrase has even become some wisdom of sorts, one that makes people regulate their “appetite” for money. The irony however is that almost all human needs, both primary and secondary, have some form of attachment to money. Plainly put, it is money that enables an individual to cater for most, if not all, of what they need in their daily life. This yields the question of whether it is true that one cannot buy happiness using money. While some people will align themselves with the argument that happiness depends not on money, others will argue that money attracts satisfaction and thus brings happiness. Irrespective of the argument one may front, money can indeed buy happiness as it reduces stress, enables control, and enables spending on others.      

Money can help one reduce or relieve intense stress. In a study investigating the relationship between stress and income, it was found out that regardless of their income, the participants experienced distressing circumstances and/or events almost in a similar manner (Blanding, 2022). The number of frustrations they underwent on a daily basis was similar. However, “those with higher incomes experienced less negative intensity from those events” (Blanding, 2022). The implication here is that the higher the income, the lower the intensity of stress one may undergo regardless of the circumstances. With reduced stress, one is likely to experience happiness as they do not have to develop negative thoughts which might plunge them into depression. It follows that with more money, it is possible that one may actually avoid being unhappy. They may spend their money in dealing with whatever stressing situation they may be experiencing and hence reduce the negative impact of the situation.

In close connection with the foregoing is that money enables one to exercise greater control over their life. One can actually largely determine the direction their life takes by spending large amounts of money. They can access more leisure time, fulfilling work, better nutrition and healthcare, and homes in neighborhoods that are friendly and safer (Gervais, 2015). As noted by Brooks (2022), satisfaction of human wants forms part of what one needs in order for them to lead a happy and fulfilling life. Therefore, when one can afford virtually everything they need for a comfortable life, there is no reason why they should be unhappy. They know they have control of what they will eat in their next meal. In the same breadth, they know they can determine the outcomes of happenings in their life. They are in full control of their life and are therefore very happy.

Money also makes it possible for a person to attain happiness by spending on other people. A research study revealed that participants recorded higher happiness levels upon donating their annual bonus to charitable organizations or spending it on other people than using it on themselves (Gervais, 2015). This was the outcome irrespective of the bonus amount. One explanation to this finding was that giving to other people, or lending a helping hand, makes human beings develop a good feeling about themselves (Clements, 2018). However, it is common knowledge that one cannot give if they do not have. In most cases, they have to have enough for themselves first before they can consider giving. The implication here is that in order to enjoy the happiness that comes with giving, one has to have a higher income or a substantial amount of money. It is a clear case of how one can buy happiness using money.

Some people may front the argument that people need family and friends more than they need money for happiness. To some extent, this may be true as people often turn to family and friends for various kinds of help (Blanding, 2022). It is however also true that in the world of today, one can only offer meaningful help to a friend or family member in need of help mostly if they have good income. On the same note, one may not easily ask for help if they are in a position to afford most of the things they need. This means they can be happy even without depending so much on their family and friends. This argument is in line with the finding that the higher the household income, the higher the happiness and life satisfaction one enjoys, even for those earning more than $75,000 (Hazell & Plant, 2021). People with such income are less likely to find themselves in compelling situations that require calling for help from outside.        

Money can buy happiness because with it, one experiences less stress, exercises control over their life, and can easily spend on other people. Less stress attracts more happiness as it ensures that one can avoid being sad because of distressing situations. Control over one’s life gives them immense satisfaction as they can determine the quality of their life. Being able to help other people in terms of money makes one feel good about oneself. Those with high incomes do not even need family and friends that much because they can respond to almost all that they need in good time. Therefore, it is not true that money cannot buy happiness, and people should strive to find better income generating activities so they may enjoy the happiness that accompanies being in possession of large amounts of money.   

Blanding, M. (2022). “More proof that money can buy happiness (or a life with less stress)”. Harvard Business School . Retrieved February 20, 2022 from    

Brooks, A. C. (2022). From strength to strength: finding success, happiness, and deep purpose in the second half of life . East Rutherford, NJ: Penguin Publishing Group.

Clements, J. (2018). From here to financial happiness: enrich your life in just 77 days . Hoboken, NJ: John Wiley & Sons.

Gervais, S. (2015). “Three psychological principles to consider before you make your next purchase”. College of Arts and Sciences . Retrieved February 20, 2022 from     

Hazell, J., & Plant, M. (2021). “Can money buy happiness? A review of new data”. Giving What We Can . Retrieved February 20, 2022 from    

More examples of argumentative essays written by our team of top-notch writers

  • Same sex marriage argumentative essay
  • American patriotism Argumentative Essay
  • Argumentative essay on marijuana legalization
  • Artificial Intelligence Argumentative Essay
  • Euthanasia argumentative essay sample
  • Argumentative essay on abortion – sample essay
  • Gun control argumentative essay – sample essay
  • Illegal Immigration Argumentative Essay

Do you know that you can buy argumentative essay online from Gudwriter and get a quality paper crafted from scratch by our team of experts? Try us now an improve your grades. We are available 24/7.

Gudwriter Custom Papers

Special offer! Get 20% discount on your first order. Promo code: SAVE20

Related Posts

Free essays and research papers, artificial intelligence argumentative essay – with outline.

Artificial Intelligence Argumentative Essay Outline In recent years, Artificial Intelligence (AI) has become one of the rapidly developing fields and as its capabilities continue to expand, its potential impact on society has become a topic Read more…

Synthesis Essay Example – With Outline

The goal of a synthesis paper is to show that you can handle in-depth research, dissect complex ideas, and present the arguments. Most college or university students have a hard time writing a synthesis essay, Read more…

spatial order example

Examples of Spatial Order – With Outline

A spatial order is an organizational style that helps in the presentation of ideas or things as is in their locations. Most students struggle to understand the meaning of spatial order in writing and have Read more…


  1. Essay about Can Money Buy Happiness?

    can we buy happiness with money essay

  2. Essay about Can Money Buy Happiness?

    can we buy happiness with money essay

  3. Essay on Money Can't Buy happiness [ Explained with Examples ]

    can we buy happiness with money essay

  4. Riches And Eternal Joy: Possibility of Buy Happiness: [Essay Example

    can we buy happiness with money essay

  5. Money Can’t Buy Happiness Essay

    can we buy happiness with money essay

  6. The “Can Money Buy Happiness? Essay”

    can we buy happiness with money essay


  1. Can Money Really Buy Happiness?

    Money, in and of itself, cannot buy happiness, but it can provide a means to the things we value in life. Money is a big part of our lives, our identities, and perhaps our well-being.

  2. Does More Money Really Make Us More Happy?

    ProStock-Studio/Getty Images. Summary. Although some studies show that wealthier people tend to be happier, prioritizing money over time can actually have the opposite effect. But even having just ...

  3. Happiness Economics: Can Money Buy Happiness?

    We explore the economics of happiness and whether money can buy happiness. In this post, we will start by broadly exploring the topic and then look at theories and substantive research findings. ... In P. A. David & M. W. Reder (Eds.), Nations and households in economic growth: Essays in honor of Moses Abramovitz (pp. 89-125). Academic Press ...

  4. Does Money Buy Happiness? Here's What the Research Says

    However, he adds that for emotional well-being money isn't the be all end all. "Money is just one of the many determinants of happiness," he says. "Money is not the secret to happiness ...

  5. Can Money Buy Happiness? It Depends on Why You're…

    According to past research, we'll be happier if we spend money on an experience than if we buy a material object—like traveling or going out for a meal instead of buying the latest product we see on social media.For example, people report more gratitude when they spend on experiences rather than possessions.. On the other hand, we can all probably think of times when we've spent money on ...

  6. Can Money Buy Happiness?

    By Sarah Gervais, Associate Professor of Psychology, Social and Cognitive Program and Law-Psychology Program. 11 Nov 2015. We're all familiar with the idea that money can't buy happiness. Yet, the reality is that we all spend money and for most of us it is a limited resource. How can we spend our hard earned dough in ways that will maximize ...

  7. One More Time, Does Money Buy Happiness?

    Abstract. This paper integrates multiple positions on the relationship between money and well-being, commonly referred to as happiness. An aggregation of prior work appears to suggest that money does buy happiness, but not directly. Although many personal and situational characteristics do influence the relationship between money and happiness ...

  8. Research: Can Money Buy Happiness?

    According to Dunn and Norton, recent research on happiness suggests that the most satisfying way of using money is to invest in others. This can take a seemingly limitless variety of forms, from donating to a charity that helps strangers in a faraway country to buying lunch for a friend. Witness Bill Gates and Warren Buffet, two of the ...

  9. More Proof That Money Can Buy Happiness (or a Life with Less Stress)

    Money can provide calm and control, allowing us to buy our way out of unforeseen bumps in the road, whether it's a small nuisance, like dodging a rainstorm by ordering up an Uber, or a bigger worry, like handling an unexpected hospital bill, says Harvard Business School professor Jon Jachimowicz. "If we only focus on the happiness that ...

  10. Opinion

    Our all-American belief that money really does buy happiness is roughly correct for about 85 percent of us. We know this thanks to the latest and perhaps final work of Daniel Kahneman, the Nobel ...

  11. Can Money Buy Happiness? Research Says: Yes, up to a Point

    Money can buy happiness up to a point — studies indicate emotional well-being rises with income up to about $75,000. ... then we do get a lot of happiness out of buying that thing," says Bryan ...

  12. Can Money Buy You Happiness?

    Essay. I believe that money can buy a person happiness due to several reasons related to the costs of comfortable and healthy living. These costs include housing, medicine, and meaningful experience, which improve the quality of life. Despite the fact that luxury is often seen as an attractive point in favor of happiness via increased budget or ...

  13. Does Money Buy Happiness?

    Essay. Whether or not money can buy happiness is a continued debate. Billions of people in all parts of the world sacrifice their ambitions and subconscious tensions on the altar of profitability and higher incomes. Millions of people dream to achieve the level of wellbeing, when earning money will no longer be a problem to them.

  14. Money and Happiness: Can Money Buy Happiness

    Money Can't Buy Love or Happiness Essay. Money can't buy love or happiness. This assertion is a reminder of the profound truth that material wealth, while important for meeting basic needs, cannot replace the intangible and deeply fulfilling aspects of human life. ... We can write you a custom essay that will follow your exact instructions and ...

  15. Essay on Can Money Buy Happiness

    Conclusion. In conclusion, money can buy temporary happiness by providing comfort, security, and experiences. However, it falls short in procuring lasting happiness that is often found in intangible aspects of life. Thus, the pursuit of wealth should be balanced with the pursuit of intangible aspects to achieve holistic happiness.

  16. Money Doesn't Always Buy Happiness: [Essay Example], 606 words

    The Limits of Wealth. There are several reasons why money may not always buy happiness. One reason is that people tend to adapt to their circumstances, a phenomenon known as the "hedonic treadmill." This means that as people become wealthier, they tend to raise their expectations and desires, which can lead to a never-ending pursuit of more ...

  17. Essay on Money Can Buy Happiness

    250 Words Essay on Money Can Buy Happiness Money and Happiness. Many people think that money is a key to happiness. This idea might seem true because with money, we can buy things that make us happy. For example, if you love video games, having money means you can buy the latest games.

  18. I Don't Believe Money Can Buy Happiness Essay

    Money is also a contributing factor but only when combined with other aspects like mentioned above. This paper gives an insight on why I don't believe that money can buy happiness. I don't believe that money can buy happiness since some aspects that leads to happiness for example respect, power love and a feeling of appreciation and ...

  19. Money Can't Buy Happiness Essay

    Long and Short Essays on Money Can't Buy Happiness for Kids and Children We have provided a few sample essays on the mentioned topic. There is one extended essay of 500 words; a short piece of 100-150 words; and ten lines on the subject of money not buying happiness.

  20. Essay on Money Can't Buy Happiness

    Students are often asked to write an essay on Money Can't Buy Happiness in their schools and colleges. And if you're also looking for the same, we have created 100-word, 250-word, and 500-word essays on the topic. ... In conclusion, money is useful for buying things we need, but it cannot buy true happiness. Happiness is about love ...

  21. Can Money Really Buy Happiness?

    From a global perspective, non-material things tend to predict wellbeing. Money, in and of itself, cannot buy happiness, but it can provide a means to the things we value in life, such as free ...

  22. Can Money Buy Happiness Argumentative Essay

    Conclusion. Money can buy happiness because with it, one experiences less stress, exercises control over their life, and can easily spend on other people. Less stress attracts more happiness while control over one's life gives them immense satisfaction. Being able to help other people in terms of money makes one feel good about oneself.