Will money make you happy?

Money doesn’t make happy. Everybody knows. Okay, when you have hardly any money, it can make you unhappy and then money can help, but at a certain level it doesn’t make happier anymore. A website that I came across when looking for inspiration for this theme gives ten reasons why:

1) Money gives instant gratification but once you are accustomed to it this fades away.

2) It doesn’t fix relationships.

3) It’s the root of all evil. Most problems are about money, some way

4) It can’t solve mental problems.

5) Money and friendship don’t mix, as 6) don’t money and family.

8) Things bought with money give only a feeling of happiness for a little while.

9) You’ll have never enough.

10) Money can’t bring peace.

(https://thriveglobal.com/stories/10-reasons-why-money-will-never-make-you-happy/)

I omitted reason 7, so actually nine reasons remain. At the end you’ll see why I did. Anyway, on the face of it these reasons seem true, and not only on the face of it, although it can be, for instance, that money is sometimes a precondition for peace or, another example, it can help you get a good psychiatrist when you have mental problems. Then the money itself doesn’t make you happier, but nevertheless because of your money you become happier.

Some years ago the Dutch psychologist Ap Dijksterhuis may have agreed with these points, but he wanted to sort out how the relationship between money and happiness really was and he begun to study it. Indeed, what he found was that wanting to have more money doesn’t make happy. This is not only so when you are rich but also when you are poor. Are you surprised that bankers belong to the unhappiest people in the world? For they have already much money and still want more. And who are the happiest people in the world when we look at the way they earn their income? Here they are: Florists; then hairdressers and beauticians; and then plumbers. They don’t earn heaps of money, but they help other people and receive a lot of thankyous.

However, you had bought a ticket in the national lottery and you win the jackpot. You feel so happy! But soon your feeling of happiness will be as before. Two years later your washing machine breaks down. Two years ago it would have been a big problem to have it repaired or to buy a new washer. But didn’t you win the jackpot? Now you don’t need to worry about the money and within a few days you have a new one. Even more, studies show that, after a few months, people who have won much money in a lottery are not happier than before but after two years they are. And so it is also with salary increases. Whether you are rich or poor, after you have received it, you are happier, also in the long run, albeit so that in poor people the feeling of happiness grows more than in rich people. Money can make you happy.

So there may be a relationship between your individual income and your feeling of happiness. Even more, studies have shown that on the average people who have more money are happier than those with less money. Note that I say “on the average”, for as we have seen, bankers, who strive to have more money and usually have very much money, are rather unhappy. Now it is so that you find this relationship between money and happiness not only on an individual level but also on an international level. Which are the happiest countries? In order (in 2018) they are Finland, Norway and Denmark. My country, the Netherlands, is sixth. These countries belong to the richest countries in the world. And the unhappiest countries? These are Burundi, the Central African Republic and South Sudan, countries with the lowest national incomes. Also on this level it is so that there is a clear positive relationship between the wealth of a country and the general happiness of its population: A high national income makes a happy nation. Nevertheless there are exceptions, like the USA. This country is less happy than you would expect in view of its national income. Why? Well, on the average the Americans are rich, but the income is badly divided: There are a few very, very rich people, and many people are below average: Seeing big differences in welfare around you makes you feel unhappy.

Much more can be said about the relationship between money and happiness, but let me return to point 7) that I left out from the list why money doesn’t make happy. It says that studies show that money doesn’t make happy. Older studies said so, indeed, but more recent research makes clear that these studies are too simple and that the relationship between money and happiness must be differentiated. As we saw above, wanting to have more money doesn’t make happy. But if you have money and if your country has, you can better care for your health (you can pay or get better doctors); you feel less uncertain and safer; it gives you more respect; it gives you more autonomy; etc. All these things make you happier and all these things can be better realized if you have money. So, the upshot is: Trying to get money does not make you happy, but having money does. And the more money you have, the happier you are, even if you are already very rich. Your problem then is getting money without wanting to get it.

To end this blog, I want to make one person happy: Ap Dijksterhuis. Most information and conclusions in this blog are from his book Maakt geld gelukkig? [“Does Money Make Happy?”] (Amsterdam: Prometheus, 2018). Buy this book and it will make him happy, for he’ll earn an unexpected extra income.