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- 💵 Shock! Money Does Buy Happiness
💵 Shock! Money Does Buy Happiness
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Get rich or die trying. Good life advice? Maybe $75k per year is enough and anything more is just a symbol of modern society's unhealthy addiction to materialism, selfishness and greed™?
The first one gets my vote. There's actual research on both sides of the debate here.
All round legend (and co-author of behavioural masterpiece Thinking Fast and Slow), Daniel Kahneman researched the relationship between income and happiness back in 2010, finding that "High income improves evaluation of life but not emotional well-being"
The study was broadly summarised as "money doesn't buy happiness beyond $75k", (or whatever amount covers the necessities and a few luxuries).
Emotional well-being also rises with log income, but there is no further progress beyond an annual income of ~$75,000.
Low income exacerbates the emotional pain associated with such misfortunes as divorce, ill health, and being alone.
We conclude that high income buys life satisfaction but not happiness, and that low income is associated both with low life evaluation and low emotional well-being.
The study was done back in 2010, so that figure's probably around $100k by now (inflation)
The point stands. Regardless of the exact $ amount: Once you reach a certain level of income, more money doesn't equal more happiness.
What if that's not true?
I mean, it sounds suspect, right? Who doesn't want more money? Who's truly satisfied with just enough?
People might say they are... Then they reach that middle class income bracket and think... Kitchen could do with an upgrade, a bigger car would be nice, and the rest of the trimmings follow on.
Sure, there's probably a point where you truly do have enough... Where each incremental step up the wealth ladder yields fewer and fewer benefits, but that's got to be a long way above the archetypal middle class lifestyle, right?
As luck would have it, another study contradicts that first one: Experienced well-being rises with income, even above $75,000 per year
Take a look at this chart... 👇
Unsurprisingly, 'Larger incomes were robustly associated with both greater experienced well-being and greater evaluative well-being'
Moreover, the shape of the relationship between log (income) and experienced well-being was strikingly linear: There was no observed plateau in experienced well-being, and there was no obvious change in slope of experienced well-being or divergence between experienced well-being and evaluative well-being, either around $75,000/y or at any other income level.
Regression results confirm that people with larger incomes reported both higher levels of evaluative well-being and higher levels of experienced well-being
This guy was way off 👇
🎶 "it’s like the more money we come across, the more problems we see…”
The answer's simple. Be unashamedly pro-capitalism, keep asking for pay rises, climb that corporate ladder, build that business... 👇
LIFE HACK
Seriously, there's nothing wrong with aiming for more.
Yeah there's always a risk that the constant pursuit of more money can send your priorities out of balance: health, family, friends... All of those things that we generally want/need for life satisfaction.
But those things can just as easily fall into jeopardy by NOT pushing for more as well...
What if you achieve your money goals, and do that really fast?
Did your friends get rich alongside you? Or are you suddenly the rich one in the group who doesn't share the same problems as your peers?
"You don't understand what it's like to struggle mate... You've got money"
It can be worse if that wealth is acquired suddenly.
Sudden Wealth Syndrome (SWS) is a term given to a psychological condition where the overwhelming pressures of unexpected and/or abrupt fortune can develop into emotional and behavioural afflictions. It can also be referred to as an identity crisis.
Likely applies to anyone that got out of crypto at the top with life-changing sums...
Anyway, I've always been fascinated by just how much our weird and wonderful psycho relationship with money influences our behaviour.
It's accepted wisdom that everyone wants to get rich quick. That's also the accepted explanation for why so many fail.
What about those limiting beliefs though?
Put another way, I think it's entirely possible that people self-sabotage when things are going too well because they experience something like a sub-conscious identity crisis.
The fear of having it and losing it mashed into the fear of having so much that everything changes. Anxiety squared.
What's the fastest way for your anxious brain to solve that anxiety problem?
An immediate return to homoeostasis. Back to the known territory. Away from the storm and back to the safety of dry land. Irrationally panic to get away from whatever's causing the distress.
Return to the status quo (or even a bit worse to teach yourself a lesson for daring to try).
Maybe it's just me that went through all of that in my youth. The guilty shame of wanting more. Aiming higher. Striving. Standing out.
As I got older, I realised this guy was right all along...
It's not a sin to seek happiness via wealth. Frame it another way if you like...
The avoidance of sadness. The solution is the same (grey line) 👇
Summing up, money does buy happiness. It also avoids sadness. Didn't we already know this?
Yes, but it's worth repeating. Wealth should be unashamedly sought. It's our moral duty to aim high.
Oh, you need money to be happy?
