It Turns Out Money Can Buy Happiness -- and This Is the Income It Takes | The Motley Fool (2024)

Money can't buy happiness, but it can make you
awfully comfortable while you're being miserable.
-- Clare Boothe Luce

Those living in or near poverty can find it difficult to be happy. If you're worried about keeping a roof over your head, it may be hard to be cheerful. But millionaires find themselves unhappy, too. Indeed, people all along the wealth spectrum often think that if only they had more money, they'd be more happy.

Researchers have tackled this issue, trying to figure out whether money can really buy happiness. It turns out that in many cases, it can -- if you earn at least a certain amount.

How much does it take to be happy?

There have been multiple studies trying to figure out, generally, the minimum income required for happiness, and they've often arrived at somewhat different conclusions. Interestingly, two key researchers, Daniel Kahneman and Matthew Killingsworth, came together to rereview their own studies and offered a revised conclusion, suggesting that those in the least-happy cohort don't experience much of a happiness boost beyond $100,000. But overall, most people tended to become more happy with more money.

How to buy happiness -- some ideas

That's an interesting finding, but how exactly might you buy happiness when you have more money? Here are some suggestions:

• Establish an emergency fund: Stashing away several months' worth of living expenses in an emergency fund can reduce stress in your life. It can also, in the event of a job loss, give you time to find a good next job instead of having to take the first one you're offered.
• Get all the healthcare you need: It's hard to feel happy, even if you're a billionaire, if you're unwell. So get your checkups, tend to your teeth, vision, and hearing, and even see a therapist if that might end up helping you be happy.
• Pay down or pay off debts: Being saddled with a lot of high-interest-rate debt can cause stress -- and cost you many thousands in interest payments, too. So get out of debt as soon as you can. You might even pay off your mortgage early if you'll enjoy not having that debt looming for years.
• Buy experiences: Various studies have found that experiences tend to make us happier than material possessions. Consider spending your money on joy-inducing activities, such as hiking, mountain climbing, travel, concerts, plays, or whatever you like most.
• Share the wealth: Other studies have found that generosity can be a mood booster -- so consider donating to charities and helping or serving those around you and those you love. You might mentor others at work, treat loved ones to meals, or help relatives with college expenses.
• Draw happiness from small things: There's no need to wait for a happy event coming up in a few weeks. You might take delight in a fancy drink from Starbucks or a co*ke slushie or by treating yourself to a new book that just came out.
• Free up time for yourself: Our time is valuable, and we often seem to have too little of it. If you have the funds, you might free up more time for yourself by paying for services such as lawn care and housecleaning. Going out to eat more or having some meals delivered can also free you up to do things you love.
• Connect more with others: Connecting with others and having regular socializing times can be a mood booster. Spend more time with your loved ones and consider making new friends, perhaps via Meetup.com groups, dancing lessons, volleyball leagues, or book clubs.
• Spend on education: When you have the funds for it, consider spending on education. You might do it just for the love of it or because you enjoy learning languages or hearing lectures. It also can help you qualify for better jobs.
• Indulge in hobbies you love: Whatever you love to do, having more money means you may be able to do more of it. Aim to read more, garden more, golf more, or do more of whatever makes you happy. Exercising regularly is a particularly good way to boost many people's spirits.
• Splurge on a longtime goal: Having more money can mean that you're able to reach one or more longtime goals, such as learning to fly, visiting more countries in Europe, or buying a vacation home.
• Get a pet: Pets can be a great comfort and happiness booster, and having more money means you can afford them.
• Spend on your future financial security: Finally, don't just spend, spend, spend without making sure that you're setting yourself up for a comfortable retirement. Spending money on retirement savings and investments can give you more peace of mind right now -- and more happiness.

If you're a low-income earner, know that your happiness might increase and plateau as you near $100,000 in income. After that, you might still keep getting happier -- especially if you spend your money in ways that boost your happiness.

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