Money can’t buy happiness, so the saying goes. In general,
psychological research agrees, especially if the money is spent on material things. Spending on life experiences is more likely to reap a happiness
dividend, but it’s not
a sure bet either.
Now a new
study sheds light on what may be the deciding factor: You’re more likely to
get lasting joy from your spare cash if you spend it on experiences shared with
The study, published online by the Journal of Personality and Social Psychology, included a series of four
experiments. Each looked at how the inclusion of others affected the happiness
people derived from money. Researchers Peter Caprariello, PhD, of Stony Brook
University and Harry Reis, PhD, of the University of Rochester were interested
in discretionary spending—money spent for fun rather than for basic
necessities, such as rent, utilities, and groceries.
Across the four experiments, a pattern emerged: Money spent
on experiences shared with others—for example, a family vacation or a night out
with friends—was valued more highly than money spent on either solo experiences
or material possessions.
In one experiment, participants were given these
instructions: “Take a minute to think back to the last time you spent between
$10 and $10,000 of discretionary money to further your happiness. On what did
you spend your money? Why?” Participants were asked what the purchase or
activity had been, who else (if anyone) was involved, and how it affected their
To try this by yourself, think about not only the last time
you spent discretionary money, but also the four or five times before that.
Then look for patterns. Did certain types of purchases or activities affect
your happiness more positively than others?
There are no right or wrong answers to that question. In the
study, however, people reported getting more joy from social purchases than
Here are more science-based tips on how to wring the most
joy from your spending:
story after you’ve enjoyed a memorable experience. Research suggests that one
reason experiences are valued more highly than objects is because they’re more
fun to talk about. It’s a lot easier to spin an exciting yarn about your recent
vacation than about your new couch, for example. Every time you recount your
adventure, the enthusiastic response you get validates what a terrific
experience it really was.
your buddy when you can afford to. In one study, volunteers were
given up to $20 in the morning and asked to spend it by 5:00 p.m. that day.
Some were instructed to spend the money on a personal expense or gift for
themselves, and others were told to spend it on a charitable donation or gift
for someone else. Those in the latter group got more of a happiness boost than
those who spent the money on themselves.
Invite a friend for coffee and pick up the tab, and you
could be getting the best of both worlds.
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