Can money buy happiness?

They say money can’t buy you happiness. Perhaps – but if it came to it, I think most of us would rather be crying in a luxury car than on the bus. If the absence of money can cause real sorrow, surely its presence is the surefire path to joy? Let’s explore both sides of this age-old debate.

Yes: Money buys you out of poverty

Let’s get the obvious out of the way: it’s extremely hard to feel happy when you can’t afford food, shelter or medicine. In fact, it’s an objectively miserable situation when you’re struggling to afford the basics for survival. So, in cases like these, money would absolutely bring genuine happiness if it took you out of these conditions

Yes: Money gives you space to find joy

Now, if we’re lucky and we’re not struggling with poverty, there are still plenty of ways money can remove us from difficult situations.

Ever been in a job you don’t love, doing work you’d rather not, with people you could do without? All the while having genuine passions and interests that you’d much rather spend 8 hours a day working on? Yep – a lot of us have.

So, if we didn’t need the money from a loveless job and could leave it behind, surely life would feel a whole lot sweeter. If we had the money to live comfortably, freeing us up to spend our days following passions, learning new skills, consuming art – or whatever lights us up – these are all doses of happiness that money can give us.

Yes: Money opens the door to charity

In its ‘5 steps to mental wellbeing’ guide, the NHS includes ‘Give to others’ as a possible route to feeling more positive in life. Now, charity can look like lots of different things. But it’s really hard to give up your time, money or goods when you barely have enough of those things to sustain yourself.

Put simply, if the advice for finding happiness or mental wellbeing is to give to others, then we need enough money to sort ourselves out first. So once more, money is the highway to improving our happiness.

No: Are the richest also the happiest?

Now, all of the above is valid. But once you’re out of survival mode, can more money increase your happiness? According to a well-known study, the answer is yes – until it doesn’t. Princeton Professors and Nobel Laureates Daniel Kahneman and Angus Deaton found in 2010 that more money does indeed increase your emotional wellbeing, 'but there is no further progress beyond an annual income of ~$75,000'– which is about $108,000 today, or in the region of £80,000. So, for the participants in the study, once they hit that threshold, more money did not buy them more happiness.

After their study, which analysed more than 450,000 responses from 1,000 US residents, they concluded that 'high income buys life satisfaction but not happiness'. Pretty resounding.

No: Money can’t buy love

It’s true – finding your purpose, falling in love, creating meaningful connections – these things have no price tag. And these are some of the most prized parts of life.

Granted, the comfort, opportunity and freedom that money provides is invaluable. But it’s obvious that there are plenty of elements of true happiness that money can have no bearing on.

Putting it all together

Interestingly, the popular paper by Kahneman and Deaton has been revisited to see if the revelations from 2010 hold true today. In 2023, the original researcher Kahneman, along with University of Pennsylvania Professor Matthew Killingsworth (who found contradictory findings with his own 2021 study), had another look.

Their new collaborative paper supported the original conclusions – with a caveat. They saw that for most people, 80% to be precise, happiness actually rises in direct correlation to rising income – even when their earnings surpass the previous cap of $75,000. Except, however, for the 20% of people who are unhappy no matter what income level they’re at.

So, what does this tell us? Well, for most of us, both science and common sense tell us that more money will absolutely improve our quality of life. But, no matter what, our happiness is in our own hands, and the best things in life simply can’t be bought.

Whatever you decide to do, look after your money. Chase's easy-access saver account lets you start saving with as little as you like.

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