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3 Ways Money Can Buy Happiness

Spend your money wisely and you'll realise you can buy happiness.

There has always been a big debate about whether money can buy happiness. Money makes it possible for you to have a roof over your head, put food on your plate and go out with your friends. Money also makes it possible for you to buy that online course you've been dying to try out, grab that gorgeous dress from the sale and go for a nice holiday. But which of these things actually makes you happy? When can money buy happiness for you?

Image by 401(K) 2012 (Flickr)
Source: Image by 401(K) 2012 (Flickr)

The answer is simpler than you think. Overall, more money does not result in more happiness. Research has repeatedly shown that once you reach a certain comfortable level of income that covers your basic needs (food, accommodation, heating, etc.), having a higher income does not bring you more happiness.

However, how you spend the extra disposable income that you do have left over after paying your bills does have an impact. Learn to spend this money right and you'll get the happiness boost you're looking for. Here are three tips to get the most HROI - or Happiness Return on Investment - from your money.

  1. Buy experiences over objects.
    Next time you're about to buy that pair of shoes and sacrifice a dinner date with a friend, think again. When you buy objects you tend to have a momentary happiness boost when you complete the purchase and perhaps the first time you use your new item. You quickly get used to owning it and stop feeling any excitement with it. Buy experiences and you'll get a triple happiness boost: when anticipating it in the future, when experiencing it in the present, and when reminiscing about it in the past. You're also much more likely to savour experiences rather than objects, connect with other people through them and get a deeper, more powerful positivity boost through all your five senses.
  2. Buy time (because you'll never get it back).
    Time is the one resource in this world that is the same for everyone. No one can buy it, create it or borrow it. No one can pause it, speed it up or change it. The only control you have over your time is how you spend it - and think wisely because you can never get it back. Usually it's worth paying 15% more to get a direct flight somewhere instead of a stopover that causes you stress and costs time. Sometimes it's better to stick to a job that's closer to home because the longer time you spend commuting, the more detrimental it is to your stress and happiness levels. Don't always sacrifice your time to save money - or even make more money. Think about what kind of use of your time is the likeliest to give you the least amount of stress and the most amount of happiness. Think about how you can make peace with time so that you feel more time affluent - as this is something that also naturally boosts your happiness. Even giving your time up for some volunteering can boost your happiness levels and improve your relationship with the clock.
  3. Give to others.
    Donating to a charity can have a happiness boost that is as powerful as doubling your household income. Choose acts of kindness and generosity that you're excited to do, and you'll feel even more connected to the cause. The more connected you are to how what you're donating is having a positive impact, the more impactful your happiness boost will be. It's also an opportunity for you to increase your sense of wealth as when you give money away you get a sense that you have so much that you can give away.

This is my challenge to you. Next time you're thinking about how to spend some of the extra money you have left over at the end of your month, think about what type of spending would make you happiest.

You could even combine some of the tips above by buying a pre-paid meal for some of your bestest friends in your local restaurant - you'll be generously giving to others, you'll be buying an experience and you'll even be buying time by going somewhere local rather than some posh place miles away.

Whatever you do, next time you're about to swipe your credit card on a new purchase, take a moment to stop and ask yourself: Am I spending my money happily and wisely?