How much does money affect happiness? It’s a question that has been debated for centuries, and the answer is still unclear.
While some people believe that having a lot of money can make them happy, others think that money can’t buy happiness.
In this blog post, we’ll take a look at some of the latest research on the relationship between money and happiness. Stay tuned!
Editor Choice: Can Money buy Happiness Statistics
- A study done by Princeton University in 2010 found out that happiness and wealth correlated up to a 75000 USD point per year after which the correlation ceases.
- A 2021 study has however shown that money increased happiness in individuals even after earning beyond 80000 USD.
- A 2018 survey by Purdue University that used Gallup World Poll data, found out that with a yearly financial gain of 95000 USD, people can experience satisfaction in life.
- Individuals with 500 USD cash at hand are fifteen percent more satisfied with life than the ones who had no cash at hand.
- Once the subjects started to earn an annual income above $105000 a decrease in their happiness levels was witnessed
It is clear from the data shown above that individuals who have some cash on hand are happier than those who do not have any cash on hand. When impoverished people begin to receive a consistent stream of income, their overall well-being rises significantly.
This research has shown that receiving money from others did not have an effect on the overall level of happiness of a tiny proportion of those who received money from others. The research, on the other hand, was unable to find any additional characteristics among the 14 percent of program participants who did not believe they had received any money despite receiving the cash.
According to the statistic that compared beneficiaries and non-beneficiaries, it can be concluded that since 82 percent of the non-beneficiaries exhibited general happiness, money is not the only thing that can make people happy, but it is a component of that happiness, as demonstrated by the statistic. However, as shown by the data presented above, it is widely agreed that money adds to our overall well-being.
Correlation between Money and Happiness
In statistics, correlation refers to a statistical connection that exists between two or more variables in such a way that when the value of one variable changes, the value of the other variable changes in a corresponding manner. This section looks at data from studies that were conducted to determine whether or not there is a relationship between money and happiness. Here are some discoveries that are relevant to the subtopic mentioned above.
- Every ten percent annual income rise increases an individual’s happiness by a similar percentage irrespective of the amount of money they earn each year.
- A 2018 survey by Purdue University that used Gallup World Poll data, found out that with a yearly financial gain of 95000 USD, people can experience satisfaction in life.
- To experience emotional optimism, individuals need an income that ranges from $60000 to $75000 annually according to the 2018 study.
- A 2021 study has however shown that money increased happiness in individuals even after earning beyond 80000 USD.
- 74% of the evident link between increased income and happiness was associated with a feeling of being in control according to the 2021 study.
- 44% of those who earned lower incomes experienced money problems in contrast to 7% of individuals who earn more than 500,000 USD.
- Within 36 months eighty-six percent of poor women in Zambia who received money from the government’s program project felt happy in contrast to 14% who did not.
- 90% of the women beneficiaries in the program said they were generally feeling happy in contrast to 82 percent who were non-beneficiaries.
According to the findings of a 2010 research, the daily subjective well-being levels that individuals experienced rose as their earnings increased, reaching a peak of $75,000 at the highest income level. According to the findings of the research, any rise in wages beyond the $75,000 mark did not result in a corresponding increase in relative satisfaction.
According to the findings of the research, every rise beyond the peak point resulted in an improvement in their overall life satisfaction. According to the 2018 study, people need a yearly income of 75000 USD in order to be happy, which is in line with the 2010 poll.
Because of this, experts agreed that although if increasing income is associated with a relative rise in happiness, the connection between money and happiness is most when one earns 75000 USD per year.
This implies that in order to be happy, individuals must have money in order to fulfill their basic requirements, which include food, healthcare, and housing, among others.
Following the point at which individuals are able to satisfy their basic needs, every further rise in their income helps to enhance their levels of contentment rather than pleasure. People who have faced a shortage of basic necessities such as shelter, food, and clothes early in their lives find that earning more money makes a significant impact in how they live and how positive they are in their overall outlook.
The 2021 research, on the other hand, finds a connection between the level of happiness and a rise in income that is more than or equal to the 75000 USD reported by previous studies. According to the findings of the 2021 research, the more money individuals acquire, the happier they become. According to the results of this study, money may purchase happiness.
Correlation between Happiness and Spending Money
For example, we should investigate if there is a connection between spending happiness and money in order to establish whether money can be used to purchase happiness or not. This section delves into the data that pertain to the statistical connection between how money is spent and how happy people are on average.
- A 2020 study showed that buying goods expensively saves time led to 10 percent higher satisfaction in life in comparison to spending more time looking for cheap goods.
- A study published in 2017 revealed that buying time led to increased positive emotions.
- Only 2% of adults plan to use money time while 98% plan to buy Material things.
- People who spend money on others end up being happier than those who spend it on themselves.
- Research comprising seventy-nine people revealed that spending choices that made people happy depend on an individual’s unique personality.
Purchasing time rather than material goods is linked with greater pleasure, as shown by a 2017 study in which people were given 40 US dollars for two consecutive weekends.
The money was spent on a purchase that saved time the first weekend, and a comparable amount was spent on actual goods the next weekend, according to the participants. As a consequence, individuals who purchased time were happier than those who purchased material goods since they had more time to spend on other activities as opposed to those who purchased material goods.
Regardless of the results above, the majority of individuals would prefer to spend their money on tangible items rather than time. This is due to the fact that, in another study, when people were asked to describe how they would spend a 40-dollar boom, just 2 percent said that they intended to use the boom to purchase time, with the remaining stating that they intended to use the boom to acquire material things.
In accordance with these findings, buying things that save individuals time leads to an increase in happiness while also allowing them to conserve time for other problems, thereby alleviating the strain created by insufficient time.
It is logical to drive great distances in order to purchase inexpensive products; but, purchasing comparable things at a little higher price in a more convenient location saves you time, which in turn improves your level of satisfaction. When money is used to purchase time, it relieves pressure on the available time for other activities, thus decreasing time pressure, which increases pleasure.
When opposed to when one spends money on oneself, spending money on others results in higher levels of happiness. Students from South Africa and Canada received modest sums of money, bringing the total number of recipients to 207.
Although they were obliged to spend the money to purchase something palatable, some were instructed to consume the snacks while others were instructed to give the treats to very ill youngsters. When compared to those who consumed the goodies, those who gave them to ill children in hospitals reported more happiness.
However, only a small number of kids from Canada were impoverished in contrast to students from South Africa, where twenty percent of the questioned pupils said that their families had not had enough food for at least a year before to the survey’s administration.
Putting money into the lives of others by purchasing presents for them, making donations to charitable organizations, and assisting people who are in need of basic necessities can greatly increase your pleasure.
This is not to imply that you must constantly spend money on other people in order to be happy, since happiness is not only dependent on how much money you spend on others, but also on the purpose for which you spend money on them.
Keep your eyes peeled for chances to freely contribute because witnessing the impact that your generosity will make in someone’s life or in a cause that you are passionate about will make you feel good.
Individuals’ spending preferences that make them happy are also influenced by their particular personalities. Extroverts’ satisfaction rose after both kinds of purchasing, whereas introverts’ happiness increased after spending at a bookstore rather than a bar, according to a research in which 79 individuals were given vouchers to use in either a bookshop or a bar.
The statistics above show a great correlation between happiness and the choices that people make on how to spend their money.
Money, Happiness and Health Correlation
There is a very significant relationship between how much people earn and their general happiness and health and longevity as shown by the statistics below.
- A 2015 study shows that people who earn more money tend to be healthier than those who don’t.
- People who struggle financially 31 percent more likely to experience stress on any given day.
- Americans who earn $ 500000 enjoy better health and long life than those who earn $ 100000 a year according to a 2001 study.
- The risk of getting high blood pressure among happy people was 9% lower than unhappy people.
- Being happy has also been linked to a 13%-26% lower risk of cardiovascular diseases.
- After elimination of other risk factors such as age, blood pressure, and cholesterol it was found that happiness lowered the risk of developing heart diseases by 22%.
- A review of thirty studies also revealed that happiness lowered the risk of death among adults with known heart diseases by 11%.
According to the data shown above, money and happiness are important factors in maintaining good health. When compared to sad individuals, those who are joyful are less likely to acquire high blood pressure.
It has been shown that happiness not only aids in the prevention of heart disease, but it also reduces the chance of mortality from coronary artery disease as well. As a result, we should investigate if there is a connection between money and happiness, since if money has an impact on happiness, it will also have an impact on an individual’s overall health, which will have an impact on the quality and length of that individual’s life.
It is clear from the data shown above that 75% of people across the globe are experiencing financial difficulties. In addition to being more productive, financially secure individuals are healthier, as well as more resilient in difficult situations.
People who are unable to purchase basic needs become suspicious, despondent, and anxious, and they are more prone to create civil unrest, conflicts, and even war as a result of their situation.
They report lower levels of happiness in their lives, as well as greater levels of stress. People that show negative emotions such as despair and tension are not content with their lives. In contrast, when people have the financial means to purchase what they need, they may make positive assessments of their current and future lives, they feel in command of their lives, and these emotions lead to feelings of happiness and satisfaction.
Does Happiness depend more on Money or Purpose in life?
Some believe that a person’s life’s purpose is more essential in fostering pleasure than their financial well-being. A BetterUp study conducted in 2018 on 2285 American professionals from 26 different sectors, representing a range of salary ranges, demographics, and business sizes, found the following findings:
- Of every 10 employees, 9 of them were ready to sacrifice a percentage of what they earned for the sake of getting greater meaning at work.
- The workers indicated their willingness to forego twenty-three percent of their lifetime earnings to find a meaningful job.
- A survey by Shawn revealed that close to eighty percent of those who participated in the survey preferred bosses who would help them succeed and have a purpose at work instead of a twenty percent increase in salaries.
As a result, the researchers came to the conclusion that employees want a sense of purpose at work so much that they are willing to pay for it. If American workers spend twenty-one percent of their earnings on housing alone and are willing to forego twenty-three percent of their total earnings in order to find meaning at work, then life purpose might be considered one of the primary needs of the twenty-first century, according to some estimates. As a result, some experts urge individuals to quit chasing after greater wages since a work that offers them meaning and makes them happy would provide them happiness.
If all that individuals desire is to find meaning in their work, why don’t they switch to lower-paying professions that provide them with more meaning in their lives? Neither the question nor the answer are meant to dispute the reality that individuals who work in occupations that help them achieve their life goals are happier. Meaningful employment increases happiness at work, but this does not imply that money is the only thing you need to be happy; rather, it suggests that purpose at work is the only thing you need to be happy. Individuals are certainly willing to spend money in order to pay for a meaningful work, which brings us back to the question of the connection between spending money and happiness. The aim of this research was not to determine whether of money or purpose is more important to happiness, but rather to determine the importance that employees place on their work’s purpose in order to achieve pleasure. As a result, this research was not conducted in order to downplay the significance of money in one’s happiness.
Final Thought
Money isn’t everything, though. Money, on the other hand, may be used as a weapon to defend yourself and your loved ones. You may put the money to good use by improving your living conditions and those of your family. It is a method of giving back to the community. Money provides you with the ability to accomplish anything you want. It assists you in taking control of your life. You may use the money to provide your children with the finest possible education, healthcare, and a head start in life. You may spend more time with your friends and family if you have more money. It is the only way for you to contribute to the causes and campaigns that you care about most. Money will enable you to enjoy your life to the fullest. It will encourage you to take pleasure in your experiences and tastes. Money will offer you happiness and fulfillment in your life.
Can money be used to buy Happiness? Yes. The statistics presented in this article are a clear indication that money can buy happiness.
FAQs
What does the term happiness mean?
Regarding one’s emotional or mental states, the answer is The term “happy” refers to a range of pleasant emotions that include feelings of satisfaction and extreme delight. It may also be used to refer to subjective well-being, such as Eudaimonia, or to the level of contentment with one’s life.
What is subjective Well-being?
Answer: It is a term used by scientists to describe a variety of different types of happiness. It is a scientific word that refers to people’s feelings of pleasure and contentment in their lives as a consequence of believing and believing that everything in their lives is going well.
What does correlation mean?
Answer: In finance and investing, correlation is a statistic that is used to assess the relative degree of movement between two different securities or investments. A correlation coefficient describes how much a pair of variables are related to one another. A correlation coefficient may be either positive, negative, or zero.
What is life satisfaction?
Answer: The term “life satisfaction” simply refers to an individual’s approval of his or her entire life. Essentially, it relates to how satisfied individuals are with their current and future life path and choices. In contrast to evaluations of current emotions, it is based on the positive views that individuals have about themselves and about their lives as a whole.
What is emotional well-being?
In response to the question, emotional well-being refers to the quality of feelings that a person experiences. People can operate and fulfill the demands of their everyday lives in society if they have a good sense of well-being, which may be defined as follows: Furthermore, the capacity to be resilient and capable of handling stress is necessary to develop self-love and create emotions that increase positive sensations.
Source
Gallup-Healthways
National Center for Biotechnology Information (NCBI)
World Happiness Report and Harvard Business Review
CNBC Make it
ScienceDaily
Kesebir & Diener, 2008
BetterUp
Forbes
American Psychological Association
