Does Money Buy Happiness After All?

Have I been deceiving you, dear reader? All the years, all the columns, pounding the same message: happiness at work comes from a variety of factors, not just money or perks. In fact, sometimes income is the worst predictor imaginable for life satisfaction – otherwise, the rehab centers wouldn’t be full of Hollywood stars and celebrities.

Now comes a new study purporting to establish a straight line correlation between happiness and income. In other words, the more money you make, the happier you are. That is it.

Somewhere, the Death Lizards of the Consultocracy are dancing.

Before you quit your meaningful and satisfying but modestly remunerated job, let me share with you what I reported on earlier today at acculturated.com, a new popular culture website. In it, I refer to the mainstream research that shows while money does have some relationship to happiness (duh), it flatlines pretty quickly. After you can cover basic needs, happiness is found outside of income:

“The consensus among (happiness researchers) is while wealth and income do have a positive effect on life satisfaction, it levels off at some point. Daniel Kahneman, a Nobel Prize winner, suggests that point is around $75,000. Others claim the number is somewhat higher. … The conclusion is the same, however: once you have enough money (however you define enough), other things bring life satisfaction.”

The shocker headline of the new study is that there there is no “satiation point” to the relationship between happiness and money. Apparently, every time you get more money, you become happier, regardless of how much you already have.

Although there are a lot of problems with the methodology of the survey, let me suggest why there might be a grain of truth in it. It studied income, not wealth. Income and wealth are different, as I noted in the acculturated.com piece:

“Income is very different than wealth, and a high or rising income is usually a reflection of many good things happening at work that spill over into the rest of lives, such as recognition by others, a sense of accomplishment, and the satisfaction that one has chosen a career well and is in the process of its mastery.”

In other words, they weren’t measuring income only, they were also measuring the things we have been talking about at Psychology at Work that make a job – and by extension, life – satisfying independent of pay. Strengths alignment. Positive relationships. Engagement. Meaning and accomplishment.

There is a lesson for us in this. The things that drive life satisfaction are available to all, regardless of how much money we make. We just need to go find them, and looking for a bigger paycheck might not be the only place to start.