Some people claim that money is the root of all evil, pointing at the enormous amounts of violence humanity imposes on itself motivated by acquiring it. Others argue that not money but the lack of money is the root of evil, as people, out of fear of being unable to pay the bills or provide for their families, sacrifice their morals to survive.
Yet, practice shows that greed and immoral behavior remain prevalent among those with more than enough, while many poor people are generous and kind. The relationship between humans and money seems complicated. For example, some say money can’t buy happiness because happiness comes from within, or perhaps from things that money can’t buy, like love, friendship, inner peace, and purpose. Others claim that money certainly can buy happiness, as money buys you great experiences like traveling around the world or going to festivals and concerts.
Moreover, with enough cash, you’ll be able to retire and live without the stress of working a job and being unable to bear the cost of living. Unsurprisingly, the question “can money make you happy?” often leads to endless discussions without satisfying answers. Nevertheless, money makes the world go round. Aside from an extreme minority, we all need money to live our lives. But there are differences in how we handle money and how we experience its value.
Some get by with little, and others are perpetual squanderers. Some are perfectly content earning a modest salary supporting their frugal lifestyles; others have millions, live lavishly, and only crave more. So it seems that the amount of money you have doesn’t correlate with how happy you feel. But does that mean that money cannot buy you happiness? Not necessarily. According to research and the ideas of certain philosophers like Epicurus and Schopenhauer, money can buy you happiness; you just have to know how to spend it.
Investing in the right pleasures
Many things in life come with a price tag, varying from the essentials like food and water to extremely luxurious items like a 17-million-dollar Rolex. But in terms of happiness, not all purchases are worth spending your money on, as some are disproportionally expensive compared to the actual pleasure they provide.
To determine the smartest purchases, we might want to look at Epicurus’ philosophy of pleasure. This ancient Greek philosopher distinguished natural and vain desires. Epicurus distinguishes between necessary and unnecessary natural desires. Necessary natural desires are hunger, thirst, and the need for rest and sleep, as we naturally desire them and also need to satisfy them for survival.
Unnecessary natural desires are the desire for expensive food, having an extensive social circle, or a sexual encounter, as we also naturally desire such things but don’t need them for survival. Vain desires, however, we don’t need for survival and aren’t natural. For example, who needs a 17-million-dollar Rolex? It doesn’t satisfy any natural desire; the desire for this item comes from opinion.
We believe a costly watch makes us happy, probably because of clever marketing or because people in our peer groups say so. Also, the desire for expensive things can never be satisfied, unlike, for example, hunger or thirst. We get bored quickly after purchasing something costly that we don’t need. There’s also no natural limit to such pleasures, so we tend to crave more after we obtain them.
On top of that, a person needing such expensive things walks an arduous path of constant perturbation because of fear of loss, not receiving the things one desires, and the stress and hard work to satisfy his cravings. Moreover, the person accumulating extreme wealth paints a target on his back.
According to Epicurus, we don’t need vain desires to experience happiness. However, we need to fulfill our natural desires. Pleasures that satisfy these desires are cheap and easy to obtain compared to most vain pleasures. How many meals and thirst-quenching beverages will 17 million dollars buy? Probably more than we need within ten human lifetimes.
Epicurus stated: “Natural wealth is limited and easily obtained; the wealth defined by vain fancies is always beyond reach.” Even though the example of the 17-million-dollar Rolex is extreme, Epicurus’ underlying lesson is that happiness does not ensue by adding to one’s riches but by keeping one’s desires fulfilled. And that the ultimate shortcut to keeping one’s desires fulfilled is keeping them limited and easily satiable.
Therefore, satisfying vain desires for happiness isn’t an effective strategy: the juice simply isn’t worth the squeeze. Moreover, a Harvard study suggested that buying many small pleasures is better than fewer larger ones.
The most valuable asset
One of life’s most significant stressors is needing money to survive, which, for most people, comes from working a job. But if your stack of cash is large enough, you won’t be required to work to survive, and thus you’ll be free of the stress of needing to be employed. We could live according to Epicurus’ ideals, but that doesn’t relieve us from having to work, exchanging our bodies and time for a salary.
Not that there’s anything inherently wrong with that; many people happily work their jobs in exchange for money, as it covers their living expenses, allows them to buy things they want, and enjoy leisure in their pastimes. But for others, sacrificing a great chunk of their time and energy for a salary is a source of unhappiness. They’d rather spend that time doing something else, like studying philosophy or creating art.
For these people, money wouldn’t just be a means of paying for pleasure; they’d use their money to buy time. Similar to Epicurus, philosopher Arthur Schopenhauer distinguishes different kinds of pleasures. The lower pleasures he called “movements of the will,” which are always satisfied at the cost of pain—for example, playing cards, horse racing, traveling, and all kinds of amusement that arouse the senses.
But he considered the highest pleasures of the intellect: thought, observation, meditation, a taste for poetry or music, learning, reading, invention, philosophy, and the like. This inner wealth is relatively cheap; it doesn’t require much money or bodily energy. However, the ‘one asset’ needed to engage in the highest pleasures is time.
The man of inner wealth wants nothing from outside but the negative gift of undisturbed leisure, to develop and mature his intellectual faculties, that is, to enjoy his wealth; in short, he wants permission to be himself, his whole life long, every day and every hour. Not just for the intellectual, but for anyone who values leisure over material things, buying time is money well spent.
A survey by researchers at the University of British Columbia suggests that using money to buy time is linked to greater life satisfaction. For example, we buy time by hiring a house cleaning service or someone who cooks. In some cases, we achieve enough wealth to pay off the suffering of having to work. For example, we could outsource the work necessary to generate income or live off investments.
In today’s day and age, we call this ‘financial freedom.’ Financial freedom isn’t about being insanely rich; it’s about having enough financial resources to live the way you want. If we wish to spend most of our time on intellectual pursuits or indulge in Epicurus’ simple pleasures: money allows us to live this lifestyle. For many, if not most people, frugality is required to achieve enough financial resources to retire and maintain the necessary capital.
The fewer expenses we have, the less money we need, and the easier it is to be financially free. Furthermore, Schopenhauer suggested we should look at our fortune as a means to protect ourselves from occurrences that might threaten us and not spend it as fast as we’ve earned it. quote: If a man has an independent fortune, he should regard it as a bulwark against the many evils and misfortunes which he may encounter; he should not look upon it as giving him leave to get what pleasure he can out of the world, or as rendering it incumbent upon him to spend it in this way.
Not spending on things, but…
Regardless of your situation, let’s say you’re fortunate enough to have a freely spendable budget. What’s the best way to spend it? Should you go shopping and spend it on material things, or are there better, more satisfying ways to allocate your cash? Of course, it’s up to you to decide how you spend your money.
However, research suggests that spending money on experiences is ultimately more satisfying than spending it on things. Dutch professor Ap Dijksterhuis (author of several books about happiness) concluded that money makes people happy if they spend it on experiences like traveling.
Psychology professor Dr. Thomas Gilovich conducted a 20-year study showing that doing makes happier than owning. In an article on Forbes, Gilovich mentions three reasons possessions lead to less happiness than experiences.
Firstly, it’s because we quickly get used to new possessions. For example, buying a new car can be exciting initially, but the novelty wears off soon after the purchase, and having the car becomes the norm. Secondly, we keep raising the bar. Once we get used to the car, we look for a better one. The purchase of material possessions, thus, only brings temporary satisfaction; what we once wished for, then eagerly obtained, loses its power to keep us contented.
Hence, Epicurus once stated: Do not spoil what you have by desiring what you have not; remember that what you now have was once among the things you only hoped for. Thirdly, Gilovich states that possessions come with comparisons. Humans tend to compare what they have with what others have. Your new car may lose value when your friend buys a better car, and this might encourage you to upgrade.
The paradox of possessions is the false assumption that the somewhat permanent, solid nature of property compared to experience leads to longer enjoyment.
Another way to purchase happiness
How come that experiences are better investments when it comes to happiness than material possessions? After all: televisions, cars, or houses last for years while experiences like travel or going to a concert are just fleeting. Research suggests that experiences provide longer-lasting happiness. The enjoyment of the experience lies in the anticipation, the purchase, the experience itself, and the memories we cherish for the rest of our lives.
Also, unlike material goods, experiences become part of your identity, and no one can take them away from you. Also, we cannot compare experiences the same way we compare things. Experiences are personal and unique, which makes it difficult to determine their value. So, other people’s experiences won’t quickly devalue our own.
Aside from buying time and experiences, there’s another way to purchase happiness: spending money to make other people happy. The act of giving is part of many religious traditions. In Christianity, for example, charity is one of the seven heavenly virtues, and it’s not surprising that many charity organizations have Christian roots.
The Zakat is the Islamic way of almsgiving and is considered an obligation for every Muslim and part of the Five Pillars: the fundamental practices of Islam. In Theravāda Buddhism, generosity (also known as dāna) is one of the ten perfections, which are noble characteristics one develops on the Buddhist path. But aside from religious and spiritual objectives and morals, the act of giving has a positive effect on how we feel.
Research by professor Elizabeth Dunn from the University of British Columbia shows that we generate happiness for ourselves by giving money to charity. However, there’s a caveat. In an interview for Boston University Radio, Dunn explains it’s not only giving itself but how we’re being generous that decides how happy we feel. She distinguishes a few “key ingredients” that turn “good deeds into good feelings.”
The first one is connection. We’re more likely to experience joy from helping others if we really feel connected with the people or the cause that we’re helping. The second one is impacted. If we can see the difference that our good deeds are making, that seems to really unlock the emotional benefits of generosity. And finally, there’s a choice.
The quickest way to strip the joy of giving away is to make people feel like they’ve been forced to give. Thus, through charity, money can buy happiness if we use it to benefit people we feel connected to and out of choice. Post-doctoral researcher at Leiden University Mara van der Meulen explains that giving has short-term and long-term positive effects.
In the short term, this gives us a positive feeling: in the scientific world it’s known as the warm glow of giving. It has benefits in the longer term too, because it strengthens the relationship with the recipient. And if you have a close bond with someone, they will be more likely to help you if you get into difficulties some time in the future.
She also mentions that according to research, other people like you more if you are generous, and people who have a lot of friends are happier than people who feel alone. However, the way giving impacts human happiness varies per individual. Some people simply don’t experience joy by giving something to someone; personality, childhood experiences, and family traditions play a role in this.
To summarize: money buys happiness if one spends it right. Simple pleasures, time, pleasant experiences, and other people seem best to spend money on.