When I was in graduate school, one of my friends jokingly pointed out that we were eligible for food stamps.
What? was my reaction. That couldn’t be right. I didn’t feel poor.
In retrospect, I guess it wasn’t surprising. I had fooled myself into thinking that a $16,000 annual stipend was more than it objectively was thanks to the corners I had cut on living expenses. I found a roommate, I sold my Infiniti in favor of a fuel-efficient Yaris, and I survived on a diet comprised mostly of cereal, Quest Bars, and romaine lettuce.
While pounding away at my thesis, H.G. Wells novels scattered around me, I’d fantasize about what it would be like to have a “real” job—you know, the kind that offered a salary above the poverty line and provided health insurance.
Now, here I am a year later, living in San Francisco with a salary a few multiples ahead of my grad student income, and I ask myself: am I happier?
In many ways, yes—but for reasons largely unrelated to money. I am engaged to a fantastic and supportive man; I have an adorable cat who makes me snort water up my nose on a regular basis; and I am living in one of the most popular cities in the country. But, in general, my stress has increased. You could say I was “happier” in graduate school, subsisting on iambic pentameter and metaphoric ramen noodles.
It wasn’t until I read Happy Money by Elizabeth Dunn and Michael Norton that I realized my feelings were not unusual: research shows, over and over again, that increased cash does not correlate with increased happiness.
This doesn’t mean that we should abandon all consideration of finances; that is neither practical nor realistic. However, according to the authors, there are some actionable items that you can undertake to make your money make you happy.
1.) Buy experiences, not things.
Virgin Galactic recently began offering 6-minute trips to space—with a hefty price tag of $200,000.
“You could buy a house with that kind of money!” most would say.
While this might be true—in some parts of the county—it isn’t necessarily the choice that will bring the most happiness. According to one German study, people who purchased new homes were happier with their living arrangement, but not with their lives in general. Survey after survey suggests that people are generally happier—and experience less buyer’s remorse--when they purchase experiences, like vacations, instead of material things. Virgin’s celestial journey might be a bit of a hyperbole, but the concept still holds. So next Friday, opt for a gourmet dinner instead of buying that new iPhone.
2.) Make it a treat.
There is a fantastic coffee shop around the corner from me—Philz—and I visit every Tuesday and Thursday around 3PM for an afternoon pick-me-up. With the first sip, I can feel my work stressors dissolve away. Why then, would I not buy myself a “small Tesora, medium-cream” everyday? Because I instinctively follow the “Keep it a Treat” axiom. This advice has another alias: “Everything in Moderation.” By preventing experiences from becoming commonplace, you ensure that they retain their allure and that they continue to provide satisfaction.
3.) Buy now, consume later.
Sometimes it’s frustrating when vendors, airlines, or hotels want payment upfront. It’s difficult to justify paying for a service that you haven’t received yet, but research in Happy Money shows that, by paying first, people are able to enjoy their experiences more when they finally arrive, because the cost of the experience has faded from memory.
4.) Invest in others.
This one might seem trite, but charity has been shown over and over to bring satisfaction. If you don’t want to risk the snail mail inundation that inevitably follows a non-profit donation, try buying your spouse or best friend a cup of coffee. As soon as you pay the cashier and hand that steaming cup of Philz to your bestie or beau, evaluate how you feel. I’m willing to bet* endorphins are flooding in.
I cannot deny that I am thankful that my fiance and I both have stable jobs with good salaries, but we are also mindful of the fact that these are only small, intermediate variables on our journey towards holistic happiness. Our next experiment? Dropping some cash on our honeymoon to Japan. For science. Stay Tuned.
*I’m using this as a figure-of-speech; gambling has not been shown to contribute to long-term, sustainable financial happiness.