More money is always better – isn’t it?
This question can be answered scientifically with the so-called paradox of prosperity. Money has a diminishing marginal benefit. Decreasing marginal utility is a bulky economic term. This term only says that from a certain level, an additional dollar creates less benefit.
And where is the truth now? How important is money to your happiness?
Since you have probably never hit the lottery jackpot, you don’t necessarily have the opportunity to compare. And as long as you have not had the experience yourself, you will probably think like most: “Of course, money alone does not make you happy … But it makes life a lot easier!”
And you’re not entirely wrong with that either.
But it’s not that simple … Because of course there are still some questions:
Let us take the knowledge gained so far in investigations as a basis.
Up to what income or wealth does happiness increase through money?
Earning more money increases happiness, but only up to a certain limit. Various studies have shown that a higher income makes us happier until we can regularly satisfy our basic needs. That means until we can easily pay our rent, our fridge is full, and we can take care of our health. In the pyramid of needs, the lower two levels, i.e., the physiological needs and security needs, must be met. To be satisfied, a net salary of 60,000 euros a year (or an average of 5,000 euros per month) is enough for a comfortable life. This means that the quality of life and the feeling of happiness through money only increase up to this value.
This limit is rather high because, depending on living conditions, you no longer have to worry about money, even with 3,000 or 4,000 euros net per month.
For the sake of completeness, let’s consider the case that no more money should be earned from active work, but that enough income is available from existing capital. Let us stay in the middle of the monthly earnings that are called to be happy, namely 4,000 euros. With 1.5 million euros in assets, you would be on the safe side to receive 4,000 euros in monthly net income from capital gains. If you want to use up the capital overtime to get these monthly amounts, just under a million is enough for about 40 years. A 40- to 45-year-old today could be left with these assets until the end of his life, especially since there is still a certain payment from the statutory pension fund on top from around 70 years of age.
Ok, let’s stick to this: As soon as someone has enough money available monthly so that they don’t have sleepless nights because of their basic needs, they have already achieved a feeling of happiness that little or little more can be increased with more money. Can higher-income still ensure that there is more satisfaction differently?
The British and US economists Angus Deaton and Daniel Kahnemann (Nobel Laureate in 2002) also stated the following in addition to the already mentioned limit of around 60,000 euros per year: One of the biggest obstacles to happiness is the feeling of not being able to do anything useful (anymore). Therefore, for example, unemployment is a trigger for misfortune for many.
Regardless of the level of income and wealth, one of the greatest drivers of happiness is something useful for other people to do. One of the results of various surveys is that well-off people often work more towards intangible goods. On the one hand, this can be a famous trip around the world or learning a new language, even in old age, or just a commitment to other people in this world who are not doing so well.
Who has more than others “feels happier.”
The following result is also interesting: Those who see themselves relatively better in comparison to their neighbors, acquaintances, or work colleagues feel more happiness.
Fittingly: In a study at Harvard University in Massachusetts, students should choose between two possible scenarios: in one they earn $ 50,000 a year, all other people only $ 25,000. In the other scenario, they get $ 100,000, but the others get $ 250,000. The majority of the students chose the first option. Better to have much less money than to be poorer than other people.
So it is good for general satisfaction if the social differences are not so big if one does not do so badly compared to others. “According to a study of the Aarhus School of Business, people are all the more unfortunate, the further they are politically left. They suffer particularly from social inequalities, even if they are not affected. “
Ultimately, nobody forces us to constantly compare ourselves to others. We developed this habit ourselves because we have acquired it from society throughout our lives.
How can you be proactively happy with a lot of money?
The previous knowledge of how happy financial prosperity can make was rather mixed. The question now is, what can you do specifically to feel happier?
I’ve never seen a bag of money score a goal.
– Johan Cruijff
You don’t have to own money to be worthy.
– Gandhi
A drop of tenderness is more than money and power.
– Buddha
A rich man is often just a poor thunder with a lot of money.
– Onassis
Having enough is happiness; having more than enough brings bad luck. That goes for all things, especially money.
– Lao Tse
You can buy a very nice dog for money, but not the tail wagging.
– Josh Billings
Money alone has not made anyone rich.
– Seneca
Power is the right of the strong, justice is his interest; It is better to leave his children a good conscience than money.
– Plato
Money makes you happy – as long as it is used properly, and this resulted in some recommendations, including:
- “Invest in experiences, so spend more on experiences than on material things”.
- “Make others happy”, that is, whoever spends more money on other people feels happier than if he had done it for himself.
- “Insert less money in safety, so to do without too many guarantees”. We humans get used to and recover from losses faster than we previously thought.
The points of putting money into experience and less into security can also be put into practice when investing. One example is to put less money into insurance and supposedly safe investments, to take more risks by using shares to invest. Or from a professional point of view, in which one sticks less to a supposedly safe, but little-loved workplace.
Anyone can make others happy with money or do something good in general by donating. In my view, however, it is not very helpful to give a homeless person a dollar. He could buy something for the next few hours, but it doesn’t solve his problem in itself. To spend a further training course or other systemic aids are more effective here, that this person comes out of his misery again. Aside from the joy you feel when you donate, I think it is part of the sense of duty for people who can live in abundance to give some of it to the needy.
10 reasons why money alone doesn’t make you happy
Many people think that money makes them ‘wantlessly’ happy. It should be clear that you cannot buy happiness. Your mental health is much more valuable. How nice would it be, for example, to be able to afford everything you want? To be able to fulfill your every wish and not have any financial problems sounds tempting, but from our point of view, it is not sufficient for long-term happiness. Here are 10 reasons for you on why money alone does not make you happy.
1. Inner peace cannot be bought
Most people strive for financial security. That is also good and correct because everyone needs a drive. However, it is not a good idea to believe that a full account fights dissatisfaction. With the money, you can buy all sorts of things, but the really important ingredients for a happy life are not available at face value.
What do you need in your life to be satisfied? The most common answers to this question are about a stable partnership, family, good friends, and similar values. Material goods, on the other hand, certainly make you proud and happy in the short term, but they do not touch your soul. A handsome income is desirable, but is it worth neglecting friends, family, and leisure activities? The unfortunate feeling of loneliness cannot be suppressed even from a full bank account. Therefore it makes sense to find a good balance between prosperity and peace of mind. A high income can better absorb many negative effects, but real satisfaction cannot be achieved with it.
2. Money makes you anti-social
You can probably observe this phenomenon directly in your immediate environment. What happens if there is only one job advertised at work for which 5 colleagues are applying? Rivalry arises.
What can be quite nasty in a small group is made worse when it comes to companies that only have their eye on maximizing profits. Here the suffering of the employees is accepted. It exploits what it takes so that the shareholders can make juicy profits.
3. Money worries
Money doesn’t calm you down but captivates you. The more of it you have, the more you ultimately have to lose. How else is it that so many millionaires are evading taxes? Especially they could not care how much they have to give up. They would still have too much to spend. But they are afraid because they identify with their money. If you want to take away even a small part of it, it’s like trying to take a piece of yourself away from them.
It doesn’t matter how much you have, your money is never safe. No fortune cannot be threatened by a financial crisis.
4. Money makes you unfree
The crass is, the more you can afford, the less free your will becomes. The money hangs over you like a sword of Damocles and directs you. You make decisions in his favor. Your friends want to have a barbecue in the park, but especially today – and only today – there is a special discount on your favorite shoe store that you cannot miss.
In such situations, people forget that only time is irretrievable, but not money and material goods. You may say to yourself that your friends will still be there tomorrow, but it counts every second with people we care about.
When asked what they would regret in their lives, very often, dying say that they wish they had worked less and spent more time with friends and family. Because here too, money is often the reason why many people prefer to be unhappy at work with a large account than to live happily with a lower income.
5. Money can put you in danger
You probably know that from school. There is an instruction that you should leave everything with the fire alarm and should only bring yourself to safety. Isn’t it terrible how even children are putting their health at risk to save valuables? That comes from the parents, of course, because they are worse. How many times have people been burned in their own house after they were actually safe and only wanted to quickly get the important documents, the priceless heirloom, or something else?
For some people, their money and possessions are more important than their lives.
6. Money makes you suspicious
Theft, fraud, rip-off …
All things you have to fear if you have something that others would like to have. Money is something everyone would like to have.
And so you become suspicious and suspect – often rightly so – behind every nice conversation with a stranger that you intend to take away your favorite.
7. Money makes you lonely
The sad truth is that values ​​like family and community are disappearing. Why? Quite simply … because nobody needs them anymore. It used to be vital to have a large family. The children looked after their parents in old age. They also helped each other in everyday life. If an accident happened again, the close ones helped you out.
Today we are all covered by pensions and insurance, that is, by money. When we are sick we pull out the ticket or say the magic word “private patient” and we are helped. In the second case, it is usually faster than in the first, but we are still dependent on nobody. We no longer need a family to take care of us.
We get the bill in old age. Why do you think the retirement homes are full up to the roof? But nobody worries before. Only when your children explain that the house is too big for you anyway and you heat the majority for free because you only live in 2 rooms, does a light come on and you regret: “I would I do it earlier… ”But now it’s too late because that’s how the children loved it.
8. Money makes life unnecessarily difficult
You have probably already been on vacation, on a school trip, or somewhere else, and found after the trip that you did not use at least half of all the things that you had packed. You dragged all that stuff around with you for free.
Or during your last move, you found out how much old junk you had stowed in the basement and/or in the attic. You knew that you hadn’t used the stuff for at least three years, but you took it back into the new booth and neatly stowed it away. It could be useful.
We prefer to make life more difficult than to separate ourselves from things. We are talking more about things than money, but you paid for them in the end, didn’t you?
9. Because you can’t buy memories
A lot of money allows great trips to distant countries, but you can’t buy memories of them. Valuable moments and memories of specific days or activities are what make a trip successful.
So don’t be sad if you can’t currently afford an expensive flight to Asia or America. Pack your good friends, buy a saver ticket on the train and go for a camping trip or a stroll through the Christmas market. There is one of the most beautiful Christmas markets in Austria and Europe. And the four of us freezing and laughing at the mulled wine stall is much better than sunbathing alone on one of Bali’s dream beaches – that’s a promise!
10. Because you can’t buy time
Work is an important part of life, that’s for sure. But with every effort to be able to afford a good standard of living, you should not forget your most important asset: your lifetime. Money gives you a lot, but lost time will never bring you back.
Many people work 12, 13 even 14 hours a day, neglecting themselves and their (mental) health to then be able to afford a very expensive spa weekend. Three days in which it is difficult to relax. Especially since you are so involved in your tasks with such a workload that you have to take care of it even during the mini-break. Happiness and above all balance does not depend on money, but on an individually designed leisure time, family, and friends. Even if everything seems to be ok at the moment, time doesn’t stop. Your parents may get sick or your friends may move to another city far away to study. Unused hours that you could now spend together will never be able to replace any amount of money in the world.
Therefore, try to use your time wisely, set clear limits, and maybe put the work behind. Those who put their private lives behind for work usually have more money at their disposal, but they are not automatically happier.
It always depends on the relationship to money. For certain people, money can even make you very, very happy. However, these people see money in such a way that you set it as a goal. One of their main priorities then is to make as much money as possible. This is equated with financial independence, freedom, reputation, power, and many other things. If the goal is reached, this is associated with an incredible number of positive feelings. People from low-lying social strata in particular, who have worked hard to get their wealth, benefit particularly from the happiness of money.
Focus on things that make you permanently happy
Money cannot be the deciding factor for your happiness. Instead, focus more on being happy with yourself. Not to see life too bleak. To enjoy the moment and spending a lot of time with people you care about.
So at the end of the day, it is true, the old saying: You can’t get the best things in life for money. So do more of the things that make you happy over the long term. And where it doesn’t matter whether you have money or not.
