In A Nutshell
If money could buy happiness it seems that our society, which is practically obsessed with consumption, would have the happiest people on Earth. Unfortunately, this isn’t the case. However, it doesn’t mean that money is incapable of buying happiness; we just have to spend it the right way. According to psychologists, we’re far happier when we purchase experiences as opposed to things. And the more we can involve other people in those experiences, the more content we will be.
The Whole Bushel
“Money can’t buy happiness” is an oft-repeated mantra, but it turns out it’s not entirely true. We actually can buy some happiness, if we spend our money on the right types of things. So, what are the items that give us the greatest satisfaction? For the most part, they aren’t “things” at all but instead are experiences. Yes, research has shown that experiences give us much more contentment over both the short and long term as compared to physical items.
These findings seem to contradict conventional wisdom, which argues that a tangible good, like a new car, offers more personal value than, say, a vacation since we’ll be able to use it for a long time. However, in truth, the thrill of getting a car or any other new item is short-lived, because we get numb to the thing after being around it day in and day out. Gadgets, clothes, and even our homes simply become ordinary after constant exposure, and eventually they wear down or become old-fashioned.
Experiences, on the other hand, inherently offer more pleasure because we know they are only temporary and they don’t have time to get stale. Even bad experiences can turn into great stories and provide memories that often improve with time. For instance, it might seem like our vacation is ruined if we miss the departure of our cruise ship and get stranded in a foreign city, but we’re left with an amazing tale of how we managed to make our way back home, the people we met along the way, and any other misadventures that might have happened. In the end, we gain an entertaining story that we can share with our friends and, one day, might even tell our grandchildren.
Work by psychologist Thomas Gilovich shows that another reason experiences make people happier is because we’re less likely to compare the value of our experiences to others, whereas we’re almost always comparing our goods to those of the Joneses. As evidence of this, Gilovich found that many people are unsure if they’d rather have a high salary if it meant they’d get paid less than their peers, or if they’d rather have a low salary but they’d get paid more than their peers. In contrast, most people would rather have four weeks of vacation as opposed to two, even if it meant their peers would get eight weeks. This shows that we often acquire money and goods merely to one-up each other, which is never very fulfilling because there’s always someone one-upping us.
In contrast, our motivation for having experiences is much more innocent—usually we just want to have a good time.
Additionally, Ryan Howell, another psychologist studying the relationship between happiness and possessions, says that we get greater satisfaction out of most everything in life when we can share it with other people. Therefore, experiences, which often involve other people, tend to lead to more happiness than goods, which we often purchase just for ourselves. Even if we embark on a solo trip, the people we encounter while waiting in lines, on the airplane, and elsewhere all give us the much-needed opportunity for human connectedness. If we’re lucky enough to have an experience with someone we know, we’ll most likely grow closer to that person and foster a deeper relationship. It’s these close, human connections that will ultimately lead to even greater happiness.
If we still really want to buy stuff, we should choose things that provide opportunities for experiences, such as purchasing a camera for the purpose of bird-watching. And if our purchases somehow help us interact with other people, then that’s even better. Ultimately, it’s the combination of experiences and interpersonal relationships that lead to contentment, so the more we can use our money to get those experiences, the closer we’ll come to “buying” happiness.