Can Money Buy Happiness?

Planning & Saving
on December 31, 2012

Whether money can buy happiness is an age-old question. It is questionable whether or not people considered wealthy tend to have more happiness than those who are not. Several studies have attempted to determine just what role finances play into one’s sense of overall happiness, though sociologists have arrived at no secure conclusion.

One article from describes a study in which sociologists discovered the optimal income for individuals to be happy is about 75,000 dollars. These studies discovered that any income increase beyond this causes little or no gain in happiness. Happiness tends to rise as income rises, until it hits this point.

Sociologists have discovered that geography is also a factor in how happy one feels. Studies have found that residents of different countries report needing more money to feel the same sense of happiness. While it was unclear whether or not the amount of wealth would secure happiness for these individuals, Dubai residents reported that they would need more than 275,000 dollars to be wealthy, whereas Americans claimed to need one million dollars.

It is better for many people to look at being happy as being able to financially cover your needs. People who are able to meet their basic needs, including food, housing and medical care, tend to be happier than those who are not. Being able to save for the future also factors into finding happiness; those who worry about having enough money to make it through an emergency are less likely to be happy. It is true that money can contribute to happiness. It can offer security and the ability to help friends and family members in the event of a crisis. Money can help to provide a relaxing vacation or to achieve social goals.

The problem is that happiness is not easily defined for each person. Money does not always guarantee happiness, as this emotion is dependent upon other factors as well, including one’s social circle, emotional health, physical health, geography and job satisfaction. There is no amount of money that absolutely guarantees happiness, or even financial satisfaction. This is something completely relative to one’s social circle, desire to make comparisons and ability to foster social connections.

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