Money and happiness

Psychologieab 5 J.

Does money make you happy? Yes – up to a certain point. Studies show: up to about €75,000/year, more money reduces worries. Beyond that, experiences count for more than possessions.

The question "Does money make you happy?" is one of the most discussed in psychology. The short answer: it depends.

What research says:

• Up to approx. €75,000/year (Kahneman & Deaton, 2010): more money makes people measurably happier because it reduces everyday worries (rent, food, health)
• Beyond that: the effect flattens out sharply. A CEO on €500,000 isn't 7 times happier than someone on €75,000
• Newer study (Killingsworth, 2023): for very happy people, happiness continues to rise with income even beyond €100,000

What really makes people happy: buying experiences instead of things, spending time with family and friends, spending money on others (donations, gifts), and the security of an emergency fund.

Did you know? Studies show that spending money on others (gifts, donations) makes you happier than spending it on yourself. Generosity activates the same brain regions as chocolate.

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