“Money can’t buy happiness,” as the uber-wealthy actor Johnny Depp once said, “But it can buy you a great big yacht to sale right up to it.”
Most of us will never be able to afford a yacht (and even those that do don’t want to pay the “sails tax”). Fortunately, new research reveals that happiness can be bought for a more modest sum: about $75,000 in income a year.
In the study, researchers tried to evaluate the effect of money in two ways: One was on how people think about their lives and the other was on the feelings they have as they experience life. Responses from more than 450,000 Americans, gathered in 2008 and 2009, were evaluated.
The study found that people’s evaluations of their lives improved steadily with annual income. But the quality of their everyday experiences — their feelings — did not improve above an income of $75,000 a year. As income decreased from $75,000, people reported decreasing happiness and increasing sadness, as well as stress. The study found that being divorced, being sick and other painful experiences have worse effects on a poor person than on a wealthier one.
“More money does not necessarily buy more happiness, but less money is associated with emotional pain,” the authors wrote. “Perhaps $75,000 is a threshold beyond which further increases in income no longer improve individuals’ ability to do what matters most to their emotional well-being, such as spending time with people they like, avoiding pain and disease, and enjoying leisure.”
September 8th, 2010 | 11:04 am
I had always heard your opening quotation attributed to David Lee Roth.
September 8th, 2010 | 11:20 am
SteveW,
I thought it was Roth too, but when I googled it I couldn’t if it attributed to him.
September 8th, 2010 | 12:20 pm
@ Steve W and Joe Carter
I am (almost) as old as David Lee Roth and I certainly remember the saying from childhood so I doubt he first said it. It sounds like an old adage and I am sure earlier generations had the same thought in earlier times.
September 8th, 2010 | 1:18 pm
I find the conclusion, as stated, entirely plausible. If our family income increased to that amount, we could live the modest but comfortable lifestyle we live now without the occasional nagging financial worries we have and get completely out of debt. We wouldn’t noticeably increase our “wealth,” or our “stuff,” so there’s no claim that we’d find satisfaction in the material. But remove those nagging worries, and our day to day functional happiness would increase.
September 8th, 2010 | 1:27 pm
The article doesn’t specify if it is studying individuals or families. If it is 75,000 for one person and no other commitments, I think the number is too high.
From personal experience, our family settled down and got relaxed and unworried once both of us started making about 25K. Be able to support yourselves, have a steady and low stress job… It’s all in what you need to be happy!
September 8th, 2010 | 4:33 pm
I can see how this is true. In the midst of the dot com boom when I had frequent overlapping job offers and was paid what I thought at the time was ridiculous amounts of money to do relatively simple (yet enjoyable) work, I felt nervous all the time because it didn’t feel like a sustainable situation (and as it turns out, I was right). Now I recieve a very nice yet not unreasonable income for the same sort of work, and feel much more satisfied.
September 8th, 2010 | 5:17 pm
I agree with the thesis of the article but I think there is one important element to happiness not mentioned – the stability or availability one perceives in their employment. Many people earning adequate salaries that would make them quite satisfied and happy during good employment times are feeling scared that they will lose their jobs and not find another.
My spouse and I knew we didn’t want stress and worry in our lives over money. When we met we were both supporting ourselves with similar incomes. Since we were happy enough with our lives before we met, we decided to live on one income (and without any debt except a mortgage) and save the other so if one of us lost our job, our lifestyle would not have to change while looking for new employment. We don’t even have to touch our savings, it just doesn’t increase until employed again.
I cannot tell you how much stress this has saved us compared to friends and relatives we know who spend every penny they earn and more.
September 8th, 2010 | 8:07 pm
Joe, you realize, of course, that you’ve identified the Democrats’ next Congressional program: the guaranteed annual minimum income.
September 10th, 2010 | 1:51 am
Dolly (from the plays “Hello Dolly” and “The Matchmaker”) put it differently. ” to have enough; enough not to worry; enough to be a little foolish sometimes” (To the best of my recollection, anyhow.)
September 10th, 2010 | 3:42 am
Do you get to choose where to live with that $75,000? I can’t imagine you’d be as happy on the East Coast as you’d be in the Midwest, where the cost of living is so much less.
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