Money doesn’t buy happiness. Or does it?

by Mark on January 11, 2010 · 5 comments

One of the most common clichés that we hear is that money doesn’t buy happiness, but have you ever noticed that many people who say they believe that money doesn’t buy happiness live inconsistently with this belief?

There are many different reactions when people find out that I have a strong desire to be wealthy. Some people are very supportive, but others make it clear that they feel that the desire for wealth is crass, materialistic, greedy, or any number of negative adjectives. When I tell people that if they want to be wealthy they need to live well below their means and save diligently, I often get the response that “money doesn’t buy happiness. I would rather be happy than wealthy.” They use this as an excuse to spend instead of save their money.

Anonymous man: “What does it feel like to have all that money?”

Arthur: “It feels great.”

Arthur (the movie) –

The first problem with their thinking is the implicit assumption that you need to make a choice between happiness and wealth. There seems to be a very common belief that the sacrifices that must be made to become wealthy are large enough that it would require sacrificing happiness as well. I think this is nonsense, but let’s take a look at the reasoning behind it.

The Contradiction

The logic goes like this: money doesn’t buy happiness. Therefore, I don’t need money to be happy. I would rather be happy than wealthy, which is why I spend my money now instead of accumulating wealth.

“Money is better than poverty, if only for financial reasons.”

– Woody Allen (Complete Prose of Woody Allen)

Have you picked up on the contradiction in this line of thinking yet?

My question is this: why would you spend all or nearly all of your money if money doesn’t buy happiness? If you aren’t any happier spending 95% or 100% of your income than you are when you spend 85% of your income, then why do it? Why bother even working for the money in the first place if money doesn’t buy happiness? Shouldn’t you be just as happy with zero money?

What Does Money Mean to You?

In my opinion, money is just a tool that we use to get what we value (or at least what we think we value). To the extent that the satisfaction of our values is what brings us happiness, money does buy us happiness. If you are clear about your values, then you are also clear about what makes you happy. My personal desire for wealth is motivated first and foremost by my love of freedom and independence, which are two of my strongest values. I don’t like being in the position of having to work for others (which is one reason that I believe that taxes should be very low). I also would love to have the means to satisfy some more materialistic concerns, like traveling around the world, buying a nice house and a nice car, or whatever. I personally don’t think it is immoral to have desires for material possessions.

“Money frees you from doing things you dislike. Since I dislike doing nearly everything, money is handy.”

– Groucho Marx –

Money is neither good, nor evil, and neither is the love of money. Rather it is what we do to get money and what we do with the money that is either good or evil. Money itself is neutral. Money can be a force for good or a force for evil. I intend to make it a force for good, and I intend to have a lot of it. Money buys you happiness in direct proportion to how much you value what you get in return. Does this mean that money is necessary to be happy? Of course not. The satisfaction of our values is often accomplished in ways that don’t require money. Like I said before, money is just a tool. If money didn’t make our lives better and happier, then we wouldn’t bother with it. The issue isn’t that money doesn’t buy happiness. The issue is that it isn’t the only thing that buys happiness. There is also no money-back guarantee that money will buy happiness. You have to be clear about your values, or money will be disappointing.

“Money will not purchase happiness for the man who has no concept of what he wants: money will not give him a code of values, if he’s evaded the knowledge of what to value, and it will not provide him with a purpose, if he’s evaded the choice of what to seek.”

– Ayn Rand (Atlas Shrugged) –

So what do you think? Do you still think that money doesn’t buy happiness? If it doesn’t, what’s the point?


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