How Does Money Affect Happiness?

New research from the American Psychological Association states that money doesn't affect if you're happy, but does influence how you find happiness. 

How Does Money Affect Happiness?
: Robocoin CEO and co-founder Jordan Kelley speaks to the media about the Robocoin Bitcoin ATM, during a demonstration of the ATM in the Rayburn House Office Building on Capitol Hill, April 8, 2014 in Washington, DC. (Photo by Drew Angerer/Getty Images)

"If only I had more money, I’d be happy” is a common sentiment. The notion fuels lottery contestants, even though research shows in the long term your new tax bracket doesn’t actually make you happier. If you weren’t happy before, chances are once the adrenaline and dopamine wears off you’ll return to baseline. 

Of course, everyone’s baseline is different, and new research from the American Psychological Association claims that while money doesn’t necessarily affect whether or not you’re happy, it does change how you’re happy. As the APA reports, 

People who earn more money tend to experience more positive emotions focused on themselves, while people who earn less take greater pleasure in their relationships and ability to connect with others, according to research published by the American Psychological Association.

That higher income and self-focused happiness levels are related is not a new concept. Collectivist cultures—both broadly and sub-cultures within the larger capitalist frame, as in America—better understand the interconnectedness of personal and social life. When the playing field is level all members seem to understand their duty to the collective. 

This is in stark contrast to the ultra-rich, many of whom are buying up luxury bunkers in New Zealand in case civilization cracks up. One fitting existential question this scenario conjures: Do you make room for your helicopter pilot and their family, or after drop-off do you send them back to the apocalypse? According to this APA research, chances are it’s thank you and goodbye. 

The paper, written by Paul K. Piff and Jake P. Moskowtiz from the University of California, Irvine, investigated 1,519 American citizens from a range of income groups. After stating their income level they self-reported feelings on seven distinct positive emotions: amusement, awe, compassion, contentment, enthusiasm, love, and pride. 

The upper class, they write, are in possession of different resources and live in distinct environments, which plays a role in their worldview. The old nature vs. nurture question is at play here: genetics formulates one part of your philosophy, but that philosophy is directly affected by your environment. 

Increased material resources afford upper class individuals greater autonomy and reduced exposure to social and environmental threat, giving rise to an internal, self-oriented focus— greater attention to one’s internal states and goals and increased independence from others, as evidenced, for example, by decreased social attentiveness and more self-interested behavior.

Since lower classes are exposed to more threats in their environment and rely on fewer resources, this shapes a worldview of interdependence. This collectivist mindset includes depending on others and being dependable when others need you. As Piff puts it, 

What seems to be the case is that your wealth predisposes you to different kinds of happiness. While wealthier individuals may find greater positivity in their accomplishments, status and individual achievements, less wealthy individuals seem to find more positivity and happiness in their relationships, their ability to care for and connect with others.

The upper class exhibited greater pride and contentment, while lower earners focused on compassion, love, and awe. The researchers hope to extend this research into other emotion-driven domains, such as facial and vocal expressions, emotional reactivity, and nervous system activation, to discover how class and environment affect our social and emotional lives. They also hope to better understand how threat detection changes with income level, and what coping mechanisms have been put into place in each group to deal with their reality. 

One thing is certain: your reality is dependent on your financial circumstances. How that plays out moving forward, in a nation with wider and wider income gaps, will be a critical component of how we fare in the coming decades. 


Derek Beres is the author of Whole Motion: Training Your Brain and Body For Optimal Health. Based in Los Angeles, he is working on a new book about spiritual consumerism. Stay in touch on Facebook and Twitter.

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