Neurological experiments show that even the hope of getting a monetary reward sets off our brain’s pleasure receptors. But you don’t need to read brain scans to see how money makes us feel and react—just walk into a casino and watch both the winners and the losers.
If money can make us happy, does having more money make us happier? Just how much does it take to make us feel better?
While 7 out of 10 Americans say they would be happier if they had more money, even a 50 percent pay raise isn’t enough for most to give up time with their children and family. That’s what a survey of more than 2,000 adults conducted a year ago by New York Life Insurance Company found.
The survey is part of the Fortune 100 company’s “Keep Good Going” initiative to explore American’s attitudes and expectations on cultivating goodness within family, personal life, work and community.
“Despite the impact of a tough economic environment and people’s conviction that life would be easier with more money, a 50 percent pay raise still didn’t move the needle when it came to cutting down on time spent with family—children and spouses. This is very telling about what Americans value,” said Liz McCarthy, senior vice president and head of corporate communications for New York Life.
In other words, once your basic needs for food, clothing and shelter are met, it’s less about money and more about interactions with others that makes for a more satisfying life. Other studies share similar outcomes:
- A recent survey by Cangrade, a job candidate screening company, found that money accounted for only 5.4 percent of employee happiness on the job. It turns out that power and influence, achievement/prestige, work-life balance, and affiliation and friendship all ranked higher, a surprise for many employers.
- Research from Princeton University professors Angus Deaton and Daniel Kahneman suggests that high-income individuals aren’t necessarily happier, but emotional well-being rose until annual income hit about $75,000. “Beyond $75,000 in the contemporary U.S., however, higher income is neither the road to experienced happiness nor the road to the relief of unhappiness or stress, although higher income continues to improve individuals’ life evaluations,” the researchers reported.
- The Harvard Grant Study, which began in 1938, followed 268 men for about 75 years to uncover what made them happy and successful in old age. George Vaillant, one of Harvard’s directors for the study, reported the significant finding: Relationships matter. A lot.
So in the long run, it’s not more money but our social connections and personal relationships that bring happiness and satisfaction. Given that tenet, how can you budget for joy, or the happiness factor? Here are 7 ideas that won’t deplete your bank account:
- Buy lunch or coffee for someone once a month. You might be surprised at how appreciated a $2 coffee can be.
- Remember someone’s birthday with a phone call, card or visit.
- Plan an event with friends or family—connect and make memories together on a vacation, reunion or just an afternoon trip to the park or zoo.
- Deliver an unexpected treat to make someone’s day—a baked goodie for a neighbor or a book/flowers/candy for a friend or child’s teacher.
- Lend a helping hand—rake leaves, make a grocery run or repair a faucet for an elderly person.
- Write notes or send cards frequently—thank-you notes are great, but people love “thinking of you” greetings too.
- Give to a cause, whether it’s buying popcorn from the neighborhood Scouts or running a 5k to support cancer survivors.
Joanne Kuster is a writer and financial educator who currently writes and operates The Money Godmother blog. She is the author of the award-winning Stock Market Pie and Entrepreneur Extraordinaire.
