Money & Happiness

Money can do many things.  If you have money, you can live life to the fullest.  Money enables people to cover all their necessities including food, shelter, and healthcare.  Having money is a key requirement to get the best education in the classroom and by way of traveling the world.  Money is also required if you want to add convenience and have some luxury in your life.  Money is tied to almost every aspect of life, but can money buy happiness?

In 2010, a study was conducted to determine if happiness can be increased when income is increased.  These researchers found out that it can.  There were limits though.  The researchers discovered that happiness increased with income, but only up to the amount of $75,000 per year.  People who earned over $75,000 were not happier than those who earned $75,000.

That sounded reasonable to me.  $75,000 would be enough to live a reasonably comfortable life in most parts of the country excluding New York City, San Francisco, or some of the other major coastal cities.  Even in smaller markets, $75,000 will not be enough to afford a first-class lifestyle.  It should be enough, however, to cover your needs, some wants, and have enough left to save for retirement.

A more recent study was conducted by Researchers from Harvard Business School.  This survey was given to 400 millionaires.  They were asked to rate their happiness based on a scale of 1 to 10.  This study found that the people who had at least $8,000,000 were happier than those with less than that amount.  Many agreed that they would be happier with even a little more wealth.  Most felt that they needed much more than what they currently have.  To score a perfect 10 on this happiness survey, the results stated that the millionaires who took this survey would need to have a 1,000% increase in their net worth.

In my opinion, money can buy many things, but I do not know if it can buy true happiness.  There have been times in my life when I had very little money.  Based on my current lifestyle and expenses, I have enough money to live for a couple of decades without having to work.  I feel blessed, but I do not think I am happier today compared to when I was just starting out.

Obviously, life is better with money compared to being broke, but I do not know if there is much of a difference on the happiness scale.  I view having money as the means to more options in life.  That makes me happy.  In my opinion, money equals freedom to live a life on my own terms.  That also makes me happy.

I just don’t think that money itself makes me happy.  Money pays the bills and allows me to buy things.  I am not overly materialist and don’t want for much.  Material possessions generally do not make me happy.


There are a few things in life that make me truly happy.  The first is when I accomplish a goal.  Even though I am focused on early retirement, I do get a great feeling when I accomplish a goal at work.  It is not based on the praise from others.  It comes from that internal sense of accomplishment.  The same feeling of satisfaction can be found when I accomplish a home improvement project, complete a workout, finish a book, or make an improvement to my blog.  For example, I am happy that you took the time to read this post.


I also find joy in the simple things in life.  Laughter makes me happy.  I take my work and my goals seriously, however, I do not take myself seriously.  I have been humbled enough times to say that my ego is right-sized.  A therapist friend of mine recently told me that a good sign of emotional intelligence is to have a good sense of humor and the ability to laugh.  I find it therapeutic to laugh at myself as well as to laugh at the absurdities of life.  I am also happy when other people laugh.


Spending time in the outdoors makes me happy.  I love going to the local park with my wife and our dog.  It feels great to breathe in the fresh air while hiking the trails and to take in the wildlife.  One of my favorite hobbies is spending an afternoon in my kayak bass fishing.  There are few things more exciting than catching a bass on a topwater lure.


The closest that I have ever come to experiencing true happiness is when I am being of service to others.  In my experience, if you want to find pure joy, go and volunteer at your local soup kitchen.  The fear of stock market volatility quickly vanishes when you tune into the needs of those who truly have nothing.

Helping people who are less fortunate than myself gives me gratitude that lasts for weeks.  It puts my problems into perspective.  These people are not thinking about finding investments with the lowest expense ratios or finding ways to pay fewer taxes on capital gains.  These folks are literally wondering where their next meal is coming from.

My wife and I try to volunteer a few times per year.  We try to not tell anyone about it.  We Just simply show up at the food kitchen on a Saturday morning and volunteer for a few hours.  Nobody needs to know how wonderful we are.  I feel that if I talk about it, it becomes more about me than about the act of giving back.  That just reduces the degree of happiness that I find in this type of volunteering.

If you are intimidated by the thought of helping the homeless, don’t get discouraged.  There are many ways to volunteer.  It does not have to be a formal process.  Take a ride to your nearest park and bring a trash bag and gardening gloves with you.  Spend one-hour walking around the park and picking up litter.

I have found that many people in the financial independence community have discovered the joy of helping others.  A good example of this occurs at the Chautauqua Financial Independence Conference.  I have read that it is common for a day of community service to be added to these events to go along with the lectures and discussions about financial independence.


Can money buy happiness? I honestly don’t know for sure.  The research shows that it can up to a point for some people.  For others, it seems like happiness is based on having more.  I also don’t know if people should be basing their happiness on how much money they have.  I have found that having money is better than not having money if the rest of your life is in order.  If you have enough of it, you have more options as to how you choose to live.  That will afford you the ability to focus your time and energy on what you are passionate about.  If the concept of being free makes you happy, money is a means to that end.


6 thoughts on “Money & Happiness

  1. Church

    Great post, Dave! I believe most of us would agree there is an inflection point between money and happiness.

    My personal opinion, being debt free is a much better position to be in than reaching millionaire status. Debt free means stress free. Being a millionaire might mean having $900k in debt.

  2. Dividend Diplomats

    Dave – excellent post. I don’t think money could buy you any of the things on your listing. Last time I checked, it didn’t cost anything to share a laugh with someone or crack a joke 🙂 But, I do think money can help by reducing your stress levels. Think of yourself at the most stressed times. Are you able to enjoy the things on your listing? If money problems cause you stress, than it will negatively impact your life. Each person has different money thresholds where they can breathe, take a step back, and enjoy life and life it to the fullest. The trap is thinking that purchasing material things is what brings you happiness, only to find out after that it was fools gold. Do cars make you happy? Yes or no? If you aren’t sure or you aren’t passionate about it, than dropping $100k on a car will never make you happy. But if your #1 passion and happiness in life is having a nice car, taking it for a joy ride each evening, and loving the crap out of the car, than maybe that’s a different story. For that individual, it would be on their listing the same way laughter is with yours. Hopefully that makes sense haha

    Thanks for the great read today by the way!!


    1. thefinancialjourneyman Post author

      Thanks for stopping by Bert.

      It makes sense and I agree with you.

      Money can make a good life even better.

      Not having to worry about money also greatly reduces stress.

      Be true your self.

  3. Chris

    IMHO, if you don’t have make at least $75k (the threshold of happiness), you might think that if you get more money, then you’ll be happy – until you get to $75k.

    While on the flipside, if you do have a good income and make more than $75k, then you may think that even more will make you happy. Because once you got there, you didn’t actually increase your happiness.

    But until someone gets to the $75000, it will be difficult to convince them that $100k a year or more wouldn’t make them more happy.

    It’s one of those things that you have to learn from experience.

    Interesting post.

  4. Xrayvsn

    The association with money and happiness is really an illusion.

    It is your underlying personality that determines if you will be happy or not. Those that always compare themselves to others and want more will never be happy because there will always be someone richer.

    Even the richest man in the world at the time, Getty, ended up being miserable because he never had enough.

    If you can find joy in the simpler things in life (laughter, friendships), you can have happiness that money cannot provide.

    One of the things I have done recently that has spurred my passion up again is starting a blog. Financially it bring me hardly anything, especially compared to my physician’s salary. But the act of writing unleashes my creativity and gives me non-monetary rewards such as interacting with like minded people (I absolutely love comments on my blog and therefore have taken the time to write comments on other blogs knowing what it is like to receive them).

    Great post and wish you much success in happiness.


Leave a Reply

Your email address will not be published. Required fields are marked *