How Money Affects Happiness

You don’t want to be rich—you want to be happy. Although the mass media has convinced many Americans that wealth leads to happiness, that’s not always the case. Money can certainly help you achieve your goals, provide for your future, and make life more enjoyable, but merely having the stuff doesn’t guarantee fulfillment.

The big question is, “Can money buy happiness?” There’s no simple answer.

It seems natural to assume that rich people will be happier than others. But money is only one part of psychological wealth. If you have clothes to wear, food to eat, and a roof over your head, increased disposable income has just a small influence on your sense of well-being.

So, yes, money can buy some happiness, but it’s just one piece of the puzzle. And there’s a real danger that increased income can actually make you miserable—if your desire to spend grows with it. But that’s not to say you have to live like a monk. The key is finding a balance between having too little and having too much—and that’s no easy task.