Introduction
The correlation between money and happiness has always been a question for debate. On the one hand, money has both absolute and relative impact: individuals enjoy being rich and being richer than others (D’Ambrosio et al. 2). Consequently, an increase in income and wealth should logically lead to a happier life. On the other hand, money’s influence on happiness can be contested by other factors, such as work-life balance (WLB). According to Gragnano et al., a sound WLB reduces psychological distress, emotional exhaustion, anxiety, and depression (2). Therefore, a person who makes less money might be happier than an individual who earns more at the cost of stressful work. Both of these positions have logical reasoning behind them. However, one can state that money buys happiness, at least to an extent.
Evidence of Money Buying Happiness
Most importantly, culture-specific scholarly studies found an exact income threshold associated with maximum happiness in different regions of the world. For instance, Kahneman and Deaton found that Americans become increasingly happier until reaching the annual personal income level of $75,000 (qtd. in Muresan et al. 2). A study of socio-economic data across 26 European countries revealed that happiness increases with annual income until the peak of 27,913 Euro is reached (Muresan et al. 8). These findings demonstrate that people in different parts of the world become increasingly happier as their income grows. The correlation stops at the self-perceived level of decent living conditions in a particular region. However, money makes people happier until the point of satisfaction is reached.
In addition, one should note that income losses lead to a decline in well-being and life satisfaction levels. D’Ambrosio et al. analyzed the German Socio-Economic Panel survey data and found that negative income shocks reduce well-being while gains do not increase it (9). The individuals may not become happier after progressing beyond a certain income threshold. However, the loss in personal income is perceived as a highly negative event. In this regard, money makes it possible to lead a preferred lifestyle and sustain a certain consumption level. Hence, the lack of money brings dissatisfaction and frustration, whereas sufficient income is associated with decent life and happiness.
Finally, money allows an individual to increase personal happiness by spending on others. For example, university students randomly assigned to purchase treats for a sick child reported feeling happier than their counterparts assigned to buy treats for themselves (Aknin et al. 20). Overall, participants of the experiment experienced a clear increase in happiness immediately after spending on prosocial needs, and even the thoughts about such an experience made them slightly happier (Aknin et al. 23). As such, money provides an individual with an opportunity to make a social contribution, demonstrate selflessness, and experience pleasant feelings in the aftermath. Moreover, spending on other people’s needs or simply out of a wish to make them happier brings more happiness to the spender. In such cases, money buys happiness for multiple individuals, which adds to its social value and self-perceived psychological satisfaction of the spender.
Why Money Has Limited Influence on Happiness
However, certain scholarly sources consider other factors than money more significant for human happiness. Most importantly, Gragnano et al. found that WLB, particularly — work-family balance, directly affects job satisfaction (14). People tend to give a negative appraisal of their work if it threatens their family life. Additionally, health was considered equally important from the worker’s perspective (Gragnano et al. 13). Given these findings, one can argue that money earned at stressful and unsatisfactory work does not bring happiness if the individual’s family life and health suffer. Consequently, people might be willing to quit a financially lucrative yet physically- and mentally-exhausting job if it jeopardizes more important aspects of their well-being. Therefore, money can be considered a secondary source of happiness since it might not be enough to preserve health or save a collapsing family.
In addition, money can be considered a short-term, fleeting source of happiness, inferior to intrinsic motivation and meaningful time spending. Whillans et al. surveyed 829 graduating American students and found that participants who valued time over money had better self-reported well-being and were more likely to pursue intrinsically motivated activities (6). In this regard, one can claim that money has a better probability of bringing happiness if an individual does not consider it a primary goal in life.
Conclusion
In conclusion, one can state that money buys happiness to an extent since scholarly studies have established the correlation between the increase in personal income and individuals’ overall happiness. Money makes it possible to sustain a desired lifestyle, contribute to social needs, make other people happier, or afford little pleasures. However, the effect stops working once an individual reaches a self-perceived level of decent personal income. At this point, happiness becomes more dependent on other factors: WLB, health, and family. Overall, money can buy happiness, but an individual should not consider it a priority in their life. Otherwise, the money earned might not outweigh such drawbacks as health damage and deteriorated relationships with family and peers.
Works Cited
Aknin, Lara B., et al. “Does Spending Money on Others Promote Happiness?: A Registered Replication Report.” Journal of Personality and Social Psychology, vol. 15, no. 2, 2020, pp. 1-37.
D’Ambrosio, Conchita, et al. “Money and Happiness: Income, Wealth and Subjective Well-Being.” Social Indicators Research, vol. 148, no. 1, 2020, pp. 1-20.
Gragnano, Andrea, et al. “Work–Life Balance: Weighing the Importance of Work–Family and Work–Health Balance.” International Journal of Environmental Research and Public Health, vol.17, no. 3, 2020, pp. 1-20.
Muresan, Gabriela Mihaela, et al. “Can Money Buy Happiness? Evidence for European countries.” Applied Research in Quality of Life, vol. 15, no. 4, 2020, pp. 1-18.
Whillans, Ashley, et al. “Valuing Time over Money Predicts Happiness After a Major Life Transition: A Preregistered Longitudinal Study of Graduating Students.” Science Advances, vol. 15, no. 9, 2019, pp. 1-9.