Can money buy happiness? I say yes, but the reasons might surprise you

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There’s much debate over whether or not money can buy happiness. The Wall Street Journal recently posted a rather interesting article on this very topic. The study found that as incomes rise, happiness and overall satisfaction with life increase. In fact, 100% of those making over $500K a year consider themselves “very happy” and “very satisfied” with life.

A previous study by Princeton University found that happiness did not increase much once annual household income reached $75,000. So if you’re making $75,000 now and you get a raise or pick up a side job and increase your income to $125,000, don’t expect to feel that much happier.

I get that. Our household income will probably be right around $75K this year. If we both do well with our businesses and our income hits $100K, I really don’t see us being that much happier than we already are. But, I do still believe that money can buy happiness and here’s why:

Can money buy happiness? Hell yes!

I don’t think money buys happiness in the sense that it allows you to purchase more “stuff.” Does stuff really make you happy? I know for me it does not. Sure, I love iced coffee from Starbucks and while I would really love to fill up my house with furniture, I know that this would not make me any happier than I already am. “Stuff” is exciting when you first buy it, and that’s it. Even our new car that we bought last year boosted our happiness immensely for about…a week? (And we’re paying on it for years…). More stuff just isn’t my definition of happy. Money can buy me happiness because it would allow me:

Freedom

To me, freedom is happiness. Freedom to not work, freedom to travel, freedom to spend time with family and friends in Arizona, freedom to spend more quality time with my husband and my daughters, heck even freedom to have another baby if we wanted to. I don’t care about decorating my house from the Pottery Barn catalog or wearing brand-name, high fashion clothes. What I do care about is living my life to its’ fullest.

To Give Back

I know we could donate money on our current income and I understand that even small amounts do make a difference, but if money were not an issue, we could really give back in ways that would have more of an impact on the world. If you ask happy people one of the main reasons why they’re so happy, it’s probably because they spend their time helping others – whether that’s through donating their time or donating their money (or both). Stepping outside of your comfort zone and focusing on something other than yourself is a proven way to increase happiness. I would love to comfortably be able to donate to the causes that I believe in.

To Travel

This goes along with having freedom, but with more money would come more opportunities to travel. I’ve talked before about traveling in an RV across the country and if my husband and I didn’t “need” jobs, we would pack up and leave tomorrow. North Carolina is where I want my “home base” to be, but that’s not to say I wouldn’t want to spend months at a time in a different location. I’d love to explore the NW and NE regions of the US, visit Arizona from mid-November through New Years, go on a cruise, spend a month or two on the Caribbean and eventually make my way overseas. I would homeschool my girls from wherever we were (yes, I already have this mapped out in my mind).

To Save More

I love saving money. I’m one of those weirdos that would rather save money than spend it. I’ve been like this pretty much my entire life. I eat cheap, I rarely buy clothes and I am always on the hunt for a deal. I ask for a discount more often than I’d like to admit – it’s to the point where it’s embarrassing my husband. Yesterday I actually asked for a discount on my daughter’s $6 prescription. I know…I know. (And for those of you wondering, I did not get it, haha.) If we made more money, I would be able to save my little heart out while still enjoying freedom from work, giving back and traveling.

So, those are the reasons money can buy happiness. It’s not for more stuff. It’s not for a bigger house. It’s not so I could travel around the world on a private jet. It’s simply so I could not worry or stress about money and live my life doing exactly as I please.

What do you think? Can money buy happiness?

Note: If you’re looking to increase your earnings or are wanting to change your thoughts on money, I highly recommend the books The Millionaire Next Door and Rich Dad, Poor Dad. I read both of these books before starting my blog. While I’ve always been good with money, these books have completely changed the way I view it. For example, do you view your house as an asset or a liability? Poor people view it as an asset, rich people view it as a liability. Rental properties, on the other hand, can be viewed as assets because they make you money. These books will help you focus on purchasing assets instead of liabilities so you can have more money and therefore, more freedom.

photo credit: Flickr via London Hotels Insight

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Comments

Chela @SmashOdyssey says
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I completely agree that freedom is happiness. I think if I didn’t need to work, I would probably still work, but in a different career. And we would certainly travel a lot!
- Sarah Brooks says
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  Traveling often is one of my dreams!! I’d love to spend the summers exploring other areas since the girls will have school the rest of the year. I would also still work if we didn’t need the money 🙂 I like having a “purpose” haha
Jayleen @ How Do The Jones Do It says
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I like your plan! Have freedom, give back, travel and save. Whew! It would be nice to not have to stress about money. That alone would help the happiness factor! It does seem the more you earn, the more you spend. Not necessarily on frivolous things but there are certain responsibilities that come with earning more. It’s intriguing to me how we look at those who own businesses and think they have it made. We don’t see the behind the scenes stuff that goes on and might be quite surprised.
- Sarah Brooks says
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  There are definitely more responsibilities that come with earning more and I think, honestly, if we were all of a sudden making a lot more money it would be really hard to not upgrade our lives. I would try to continue living simply and not getting in over my head, but I can almost guarantee a few upgrades would be made…thus making it so we were dependent on those higher earnings. It’s a tough battle, for sure!!
diane @smartmoneysimplelife says
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My dad used to say that money bought a better class of misery!
I’m pretty happy already so for me, money provides choices. I’d rather be able to choose to work less and potter in the garden more than slave away at a job I hate just to make more money. That definitely wouldn’t make me happier! I don’t need to be mega rich, I just need ‘more than enough’. I wouldn’t say no to a lottery win though!!!
I’ve read Rich Dad, Poor Dad and I’ll be adding Millionaire Next Door to the reading list. One book I highly recommend is Your Money or Your Life.
- Sarah Brooks says
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  Hi Diane! Thanks for the book recommendation! I will have to look into that! And I agree – I do not want to slave away at a job just so I can have more money. I love what I do now (freelance) and would continue doing this no matter how much money we have haha! But it would definitely be nice to have my husband home more often 🙂
Jef says
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Hey Sarah,
Cool article you’ve written here! 🙂 I agree with your reasons and money doesn’t exactly buy happiness, it buys freedom and options really..
I’m really starting to change my mindset on the way I feel about money, am not as concerned or worried about losing it but finding it important to save a bit of a what I earn to then invest..
I’d really agree on the travel, freedom and giving back..
Rich Dad, Poor Dad and Millionaire next door are great books as well, there’s a whole heap of others as well including money mastery written by Tony Robbins that I’ve got on my list to read!
- Sarah Brooks says
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  Hi Jef! Ooo I’ll have to look into Money Mastery! Thanks for the recommendation! I view money very similar to how you do. I’m also not as concerned with losing it (you can always make more!) and want to take advantage of opportunities that come my way.
MarieMakesCents says
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My grandma likes to say that when my great great relatives struck oil money the men of the family were ruined (the women were, of course, still models of frugality and modesty). I agree that THINGS don’t buy you happiness, but MONEY can put you on the path to happiness.
I believe that happiness is something you have to create for yourself. Having the money to relax and not worry about the mortgage would lead to having more time to indulge in the pastimes that give me pleasure. So while it can be a catalyst for happiness I try not to pin my happiness on having it.
- Sarah Brooks says
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  That’s a great way to think about it! I completely agree. Money is one of those necessary evils for sure. It’s very easy to get greedy and want more, more, more…but you have to focus on what you truly want out of life. While I DO want to be financially independent, I also know how important it is to spend time with my family NOW and not work all the time. We need money to survive, but it doesn’t have to determine our happiness.
  Thanks for the comment!!
Christina @ Embracing Simple says
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SO so true! Having enough money definitely gives a certain sense of freedom, especially when it comes to being able to focus on your passion for work instead of being tied down by job you hate (but need for the salary you’re earning), and being able to travel and other experiences.
I would agree that money can definitely buy happiness to a certain extent, as long as the focus isn’t on to accumulate “stuff”, but rather in the reasons you’ve mentioned 🙂
Melissa @ Sunburnt Saver says
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I always thought that study was interesting – anything more than 75k and happiness plateaus? I think a better study would analyze happiness in regards to money and where people live… for example, I’m looking at moving to Seattle, and I’m pretty sure 75k would not be enough to get a house and provide for a family. My happiness would definitely be lower on a 75k salary there, just because I’d probably have to commute SUPER far to be able to afford a house!
That said, more money definitely brings freedom – freedom to do what you want, when you want, and the freedom to give back. Personally, I can’t wait til I make more and can donate to charity! That’s where joy for me comes from 🙂
- Sarah Brooks says
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  Really good point about narrowing it down to where people live!! Like in NYC, there’s no way $75K would be enough for a family. Seattle?!? I wanted to move there so bad haha. We ended up choosing NC because we thought my husband could transfer his job out here (turns out, he couldn’t, but by that point we had already researched and wanted to live here). But…Seattle was always where I saw myself living! Are you thinking of moving soon?!