Can Money Buy Happiness? Studies Say ‘Maybe’

Sughnen Yongo-Okochi

Sughnen Yongo-OkochiWed, May 10, 2023 at 12:23 PM HST·2 min read

Recent studies have suggested that when we make purchases that are driven by our goals and values, we may experience greater levels of happiness.

A study published in the British Journal of Social Psychology suggests that the extent to which our purchases align with our goals influences our happiness and life satisfaction.

According to a principle called self-determination theory, goals reflect what our extrinsic and intrinsic motivations are. Extrinsic goals are those societal expectations imposed on us. An example is working hard at a job, not because we are passionate about it but because we need money. Intrinsic goals, on the other hand, stem from our internal motivations. Examples of intrinsic goals include nurturing relationships, helping others, and contributing to growth, learning, and development.

Things vs. experiences

What we spend our money on also determines happiness, according to past research. A 2011 study found that we tend to feel happier and more fulfilled when we spend money on experiences rather than material possessions. This could mean traveling to a new place, trying a new restaurant, or attending a concert or event. People report feeling more gratitude and fulfillment when they spend money on experiences rather than possessions.

However, it’s important to note that not all experiences are created equal. We’ve all had times when we’ve spent money on an experience that ended up not being worth it. For example, you might have splurged on expensive event tickets only to find that the event was underwhelming. Or you might have gone out to dinner with a friend only to find that they were more focused on their phone than on your conversation.

Spending money on experiences can be a great way to boost our happiness and well-being. Still, it’s important to be mindful of the experiences we choose to make sure they align with our values and priorities.