Science Says Money Does Buy Happiness If You Spend It the Right Way

March 2, 2018 5 min read
Opinions expressed by Entrepreneur contributors are their own.
There is frequent talk about how much money it takes for someone to truly be happy. Many studies have shown that happiness levels increase with income up to roughly $75,000 in annual salary. After that, there tends to be little correlation between income and happiness.

For me, I think making 1000x more than that seems like the best option in the world. But what I've found is that with more money comes a lot more stress in my life. That being said, I still like it.

The studies
These studies are looking at averages, not the experience of any particular individual. There are some people happy making $30,000 a year and others who believe they need hundreds of thousands to support their lifestyles.

These studies are not looking at how people are spending their money. There have been many studies demonstrating that people are happiest when they spend money on certain things. Therefore, money really can buy happiness if you spend it correctly.Money can lend you the opportunity to have memorable experiences. Although you do not need a lot of money to have certain experiences, to travel the world and do so comfortably, significant amounts of money can go a long way. Therefore, spending money on experiences will give you many moments of happiness as well as positive memories to look back on.

One important point to note is that the experiences you pay for should be ones that you genuinely enjoy, not just things that society values. If you hate going to concerts, for example, then splurging to go to a show is not a good use of your money.