The saying, money can’t buy happiness is misleading. Elizabeth Dunn, co-author of Happy Money, associate professor of psychology at the University of British Columbia, has been studying money and its relationship with happiness and confirms, money can buy happiness if you follow the 5 core principles of happier spending:
1. Buy time
People feel happier when they use their money for time-saving services rather than on material things.
2. Buy experiences
People actually get more happiness from buying experiences like trips and special meals than from buying material things like gadgets, clothes, or shoes. Also, buying experiences as gifts for others (tickets to a baseball game or spa day) versus material things also delivers more happiness for those people who are receiving the gift. Something that should be considered when buying gifts for loved ones for birthdays and special occasions.
3. Pay now, consumer later
Almost everything about modern society pushes us to consume right away, and often pay for it much later. People are better off doing just the opposite. You’re more likely to get happiness from your spending if you can pay upfront, and actually delay consumption. By paying in advance, you get the pain of paying out of the way, and you get to enjoy the pleasure of anticipation. It is good to separate payment from the experience itself.
4. Make it a treat
Having your favourite things a little less often can actually enhance our ability to enjoy them. The more we have of something, the more we tend to get used to it, and lose the same sort of intense pleasure we got, when we first experienced it. Taking a break from the things you enjoy can renew your capacity for pleasure.
5. Invest in others
When people spend money on others, they actually get more happiness than from spending it on themselves. Donating to a charity can especially lead to happiness. But avoid “auto giving”, where you automatically contribute monthly or yearly to a charity because it may not lead to increased happiness. “Set-it-and-forget it” could also mean you are probably not getting much of a burst of happiness when that money disappears from your bank account every month or every year. So, make giving to charity memorable.
Result:
While money can make you happier, remember to consider what you are buying and what you will actually get out of the purchase. Remember the longer term benefits and not just the immediate gratification the next time you buy something.
Sven Franssen