Money Can Make You Happy – If You Give It Away
Is happiness linked to how we spend our money? Apparently yes, according to a recent study published in Science.
And shoppaholics would be surprised to hear the results – spending money on other people is more fun than spending money on one’s self. And, after you’ve spent money on other people, you gain more satisfaction in buying something for yourself.
Is this something new? I don’t think so. Ask moms with little children. I’m sure most of us would rather shop at Baby Gap outlets and toy stores than spend our money in high-end boutiques.
What is new is the effect of the so-called ‘prosocial spending’ – spending money to buy gifts for others and donating to charity. It seems that this type of spending is closely related to an individual’s overall satisfaction with his/her life.
This link between generosity and happiness is not dependent on income. It’s not the absolute amount that translates to happiness – it’s all relative to what you have. In fact, poor people tend to put a higher proportion of their income on prosocial spending than rich people. However, on the average, people tend to allocate about 10% of their monthly budget to prosocial spending, according to the researchers.
Philanthropic acts of donating to charity can make you happy but it’s not the only factor that’s involved. According to surveys, Americans are tops in terms of ‘per capita charitable donations’ but they are not tops when it comes to happiness. Less generous countries such as the Netherlands and the UK have actually much happier citizens.