Yes! … Well, maybe… Some of the time?
It’s a much-debated question. And the answer could vary from day to day. Of course, if you ain’t got it, chances are you’ll be vibing on the money goodness. And for those with plenty in the bank but a heavy heart, it will be a ‘not so much’.
Confused much? Hmmm. Us too. That’s why we’ve turned to the research to see if we can get to the bottom of this burning question.
Now, if you’re like us, and like to skip to the last page to see how things turn out, you’ll like this cos we’re summing it up right at the start. Does money bring you happiness?
YES is the short answer.
The long answer? YES. But only up to a point!
This is what the research shows:
/ People in richer countries are, collectively, happier than people in poor countries
/ Within countries, those with higher incomes are generally happier than people on low incomes
Seem obvious? We thought so too. But here’s why we need the long answer.
Once basic living needs are met, the amount of happiness gained from each additional dollar of income rapidly declines.
Surprised? Well, picture this. It’s a gorgeous late afternoon. You’re out with your loved ones and you feel like a glorious, chilled glass of Pinot Gris. You head to the bar, only to find out the house wine is a Sauvignon Blanc. Does your heart plummet? Is happiness really about being able to splurge a couple of extra dollars on what you want?
Let’s break it down.
What exactly IS ‘happiness’ and how can money contribute? Perhaps what people are really trying to get to the bottom of is expressing contentment or satisfaction with their lives – including what their finances add to their quality of life.
Like a monk in meditation or a kid in a candy store, can we be in a perpetual state of bliss? Surely money can’t be the answer.
Rather than it being the path to enlightenment, what we CAN say about money is that it can contribute to a sense of security, better health, less stress and, perhaps above all, choice. Priceless right?
We took a look at some studies on which choices boost happiness and found out a couple of interesting things:
/ In something of a paradox, giving money away makes people feel happier than spending it on themselves.
/ Experiences such as travel or skydiving, or even just going to a movie, provide more enduring satisfaction than material purchases.
So, just as we suspected, it seems that memories provide better happiness value than physical possessions. Perhaps that glass of Pinot Gris actually represents a memory in the making. Enjoying those moments out with friends and family are priceless. And the good drop – well, that is the cherry on top!
So! Radical idea … let’s stop referring to ‘financial planning’ (the what) and start talking about ‘happiness planning’ (the why). That’s the fierce female way.
For many people a financial plan is all about milestones. Things like buying a house, meeting school fees and funding retirement. Important as these things may be, what’s missing is the journey – and no, that doesn’t mean the insurance premiums, super contributions and mortgage repayments. It means those Pinot Grigios, sand between the toes and, perhaps more important than anything, time spent with loved ones.
Of course, any ‘happiness plan’ will have a financial component. But it will be focused on the journey of life, rather than financial destinations. It will be more about experiences, bucket lists and relationships than annuities, tax refunds and investments. Now, that’s something we can get excited about.
Ready to get started on your happiness plan?
What makes your heart sing? How do you want to live? What matters to you? If push comes to shove, and you have to make choices, you want to be in a position to make strong, informed decisions.
Include your answers to those few questions in your financial plan and turn it into a ‘happiness plan’. Restructure it to not only meet your long-term needs but also to allow you to indulge your shorter-term whims and desires. Factor in those Pinot Grigios and turn a gorgeous afternoon into a perfect one.