Oddly Enough – winning the lottery won’t make you happier. In studies, lottery winners, a year after winning are no happier than a control group of people who did not win.
So why do most of us pursue more? The Godfather of Positive Psychology, Martin Seligman explains that we might believe we are better off with more money but the reality is that more money won’t impact our happiness: ‘The truth is that your judgment that your circumstances are better goes up with income, but not your spirits.’ What’s the point of an improvement in circumstances without an improvement in spirits? During the researching of my book I used up all my savings, maxed out my three credit cards, had to sell my kayak, my watch, my coffee machine to pay the bills. Finally I believed that if I sold my house and got the money from that, that I’d feel happier. I sold the house, paid off my debts and had enough money to finish the writing of the book. Paying off my debts did mean that I had less to worry about, and it solved a problem, but getting the lump sum of cash itself didn’t make an ounce of difference to the strength of my happiness (Animal).
You are not alone if you believe that life will be better if you spend a lot of money on things like a hotel suite, or a car, or a bed. And not alone if loss of money through unexpected spending often triggers negative thoughts: the 'cash blow' of having to buy something you weren’t expecting. And you are not alone if you believe that good credit scores and buying power are important to your happiness. In a survey published in the American Economic Review in 2011, 2,699 participants were asked to consider the following scenario: Either choosing a job that paid US $80,000 a year with good working hours and a full night of sleep, or, choosing a US $140,000-a-year job with long working hours and only six hours of sleep. Most participants chose the higher-paying job. What would you choose?
How much money do you need? How much money is enough? You need money, but studies conducted by Stanford and Harvard Universities, have shown that once you meet a threshold that covers your basic needs, more money beyond that threshold will not make you any happier. According to Harvard Professor Dan Gilbert (the bestselling author of Stumbling on Happiness) the threshold in the USA is US $40,000. Cost of living varies by location, but the point is that once you cover basic needs, any increase in your cash levels will not have an impact on your happiness.
Author of The Happiness Animal – watch the book trailer