Guest opinion: Can money buy you happiness?
By Brittany Heard | Financial planner, Foster Group
It seems as if everything we’ve read and heard says that buying stuff doesn’t make us happy. We go shopping and buy new shoes thinking it will make us happy. Unfortunately, it only lasts for a short time. But what if there was a way to spend money that did make you happy?
Another financial adviser I work with recently recommended the book “Happy Money: The Science of Happier Spending” by Elizabeth Dunn and Michael Norton. Dunn and Norton researched spending related to happiness and came up with five principles to increase our happiness through spending money.
Research shows that buying experiences, such as purchasing tickets to a concert or sporting event, or taking a vacation, makes us happier than buying stuff. If the experience brings you together with other people or creates a memorable story, it is even more likely to bring you happiness. My husband and I have stopped purchasing anniversary or Christmas gifts for each other and generally purchase tickets to a concert or sporting event instead. Since doing this, I realized that I never remembered what I received from him the prior year, but attending an event is a memory we can enjoy and share together.
Make it a treat
In our culture, it is easy to purchase whatever we want at any time. Because I’m obsessed with chocolate, I eat a lot of it. But Dunn and Norton point out that the more we have access to something, the less we enjoy it over time. Some companies have started taking advantage of this by making things unavailable for certain periods of time and bringing the items back. Then consumers are more excited to purchase the item, because they have not been able to enjoy it for a while (pumpkin spice latte lovers). Personally, I look forward to Reese’s pumpkins in the fall. They truly have the best ratio of chocolate to peanut butter! I enjoy them more because they are only available for a certain period of the year. Dunn and Norton advise us to limit ourselves to certain items so that when we do indulge, we enjoy it more.
We often sacrifice time to save small amounts of money. I have found myself driving to the store to purchase an item and avoid paying the $8 shipping fee, but in return, I sacrificed time for my family or myself. Dunn and Norton say purchases that reduce or eliminate the worst minutes of our day can provide the largest amount of happiness. When we purchased our home a couple of years ago, I told my husband that a Roomba purchase was a requirement. That little vacuum robot saves me so much time that it makes me happy! Now, I just need a robot mop …
Pay now, consume later
Credit cards are continually increasing how much we buy now but pay later. Using credit cards minimizes the pain of paying at the time of purchase, but the detachment has made it hard for us to remember how much we spent. Dunn and Norton point out that delaying consumption can increase our happiness. If we purchase something now but don’t get to use it right away, it increases our happiness. My husband and I purchased tickets to a football game, and looking forward to it was just as exciting to me as attending it.
Invest in others
Giving money to a charitable organization or another person truly makes us happier than spending it on ourselves. Spending as little as $5 to help someone else can increase your own happiness. The greatest happiness is received if we can see the gift used or spend time with that person. My husband and I took dinner to some friends who had an unexpected job loss and other financial hardships. We enjoyed this kind of giving more because we gave to them and were also able to spend time with them.
It is possible to be happier in your spending if you follow these five principles: Buy experiences; make it a treat; buy time; pay now and consume later; and invest in others. I encourage you to take some time to think about your spending habits and see if you can make some small changes to increase your happiness.
Brittany Heard works with Foster Group clients to define and achieve their financial goals. She enjoys helping clients make small changes that benefit them long-term. Heard’s opinions in this guest submission do not necessarily reflect those of her employer.