Yes, more money will always make your life better, but thats not all there is to happiness, says new study – ZME Science

In a twist thats bound to surprise nobody, a new study finds that there isnt actually any limit past which more money wont make you happier. Yes, that sounds disheartening, but the authors also caution that its not the only thing that makes us happy by a long shot. Chasing money at the expense of everything else might actually make us less happy.

The relationship between wealth and happiness has always fascinated researchers. One widely-known bit of research in the past suggested that the magic number is $75,000 per year. You wont gain more happiness by gaining more than that, it added. But if youve had to bear through the pandemic jobless or in a job you hate but had to take, struggling to make ends meet, while watching rich people suffer in mansions with gardens or spending their holidays on private islands, you might not put too much stock in that idea.

New research agrees with you.

[The relationship between money and well-being is] one of the most studied questions in my field, says Matthew Killingsworth, a senior fellow at Penns Wharton School who studies human happiness, lead author of the paper. Im very curious about it. Other scientists are curious about it. Laypeople are curious about it. Its something everyone is navigating all the time.

Killingsworth set out to answer the question with a wealth of data. The technique he used is called experience sampling, and it involves having people to fill out short surveys at random times of the day. These serve as snapshots of their feelings and moods over time, and how these fluctuate.

All in all, he collected 1.7 million data points (snapshots) from more than 33,000 participants aged 18 to 65 from the US through an app called Track Your Happiness that he developed. This allowed him to obtain measurements from each participant a few times every day, with check-in times being randomized for each participant. These were measured on a scale ranging from very bad to very good, and every participant also answered the question Overall, how satisfied are you with your life? (on a scale of not at all to extremely) at least once. These all measured evaluative well-being, he explains.

It tells us whats actually happening in peoples real lives as they live them, in millions of moments as they work and chat and eat and watch TV, he explains.

But the study also tracked experienced well-being by asking about 12 specific feelings. Five were positive confident, good, inspired, interested, and proud and seven negative afraid, angry, bad, bored, sad, stressed, and upset. Two other measures of life satisfaction collected on an intake survey were also factored in here. Evaluative well-being measures our overall satisfaction with life, while experienced well-being indicates how we feel in the moment.

All in all, Killingsworth says the findings suggest that there is no dollar value past which more money wont matter to an individuals well-being and happiness.

Its a compelling possibility, the idea that money stops mattering above that point, at least for how people actually feel moment to moment, he adds . But when I looked across a wide range of income levels, I found that all forms of well-being continued to rise with income. I dont see any sort of kink in the curve, an inflection point where money stops mattering. Instead, it keeps increasing.

We would expect two people earning $25,000 and $50,000, respectively, to have the same difference in well-being as two people earning $100,000 and $200,000, respectively. In other words, proportional differences in income matter the same to everyone.

Killingsworth used the logarithm of a persons income, rather than the actual income, for his study. In essence, this takes into account how much money someone already has. This approach means that rather than being just as important for everyone, each dollar will matter less the more a person earns.

He found that higher earners are happier in part because they feel more in control over their life. More money means more choices, options, and possibilities in regards to how we live life and spend our time, as the pandemic brutally showed. Someone living paycheck to paycheck will have less autonomy over their choices than someone whos better-off such as not having to take any job, even if you dislike it, due to financial constraints. Still, in Killingsworths eyes, this doesnt mean we should chase money, and I feel the same way.

Although money might be good for happiness, I found that people who equated money and success were less happy than those who didnt. I also found that people who earned more money worked longer hours and felt more pressed for time, Killingsworth explains.

If anything, people probably overemphasize money when they think about how well their life is going. Yes, this is a factor that might matter in a way that we didnt fully realize before, but its just one of many that people can control and ultimately, its not one Im terribly concerned people are undervaluing.

He hopes the findings bring forth more pieces of that ever-elusive puzzle: what exactly makes us happy? Money definitely plays a part, but, according to the findings, only modestly, Killingsworth explains.

The paper has been published in the journal PNAS and on the Penn State Universitys blog.

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Yes, more money will always make your life better, but thats not all there is to happiness, says new study - ZME Science