We have all been told that money can’t buy you happiness but perhaps the people telling us this were simply spending it wrong. In their book “Happy Money: The Science of Happier Spending”, researchers Elizabeth Dunn and Michael Norton used research to investigate the relationship between how we spend and our happiness.
Based on their research they found that money can increase happiness if spent in certain ways. The recommendations that stood out to me were:
Buy experiences instead rather than things
Research shows people derive more pleasure from buying experiences than objects. We adapt quickly to possessions meaning the pleasure of acquisition is short-lived whereas the memory of an experience allows you to derive additional pleasure. When you think about the greatest joys in your life to date were they objects or experiences?
Spend money on others instead of yourself
Dunn and Northon explain research shows our happiness is closely tied to the quality of our social interactions. Spending on others, whether giving gifts or charity, tends to strengthen social ties, and enhance our self-image.
Buy many small pleasures instead of few big ones
Our ability to adjust even to large, expensive possessions means the pleasure we derive from a new iPhone or BMW fades quickly. Given this, you might find more happiness taking regular holidays than splurging the same amount of money on a one-time purchase of a house.
Thinking about these recommendations you could derive that spending money frequently on experiences for others may be the best way to buy happiness. This year make it your resolution to buy more happiness.