What if we told you that money actually can buy happiness?
...but it has a cap. $75,000 to be exact (according to the Proceedings of the National Academy of Sciences of the United States of America, or PNAS).
We all know that money is necessary to pay the mortgage, feed our families, and pay for the gas to haul us around town.
But using money to purchase life’s resources does not necessarily give us peace in our minds, less stress, or happiness in our lives.
According to the PNAS study, those who make more than $75,000 are not necessarily happier than those who make exactly $75,000.
Why? If research shows that $75,000 is enough to purchase life’s necessities, then shouldn’t the excess be used to purchase things that can make us happy?
Indeed, the extra income can buy you the newest model car, a coveted new house, and your place in line for the iPhone 17. But what if after all of the upgrades, you are still unhappy?
Or, what if after all of the upgrades, your spending increases because you are able to also increase your credit lines?
What if you start living so far outside of your means, that you end up going to jail because you would rather not pay your taxes and commit fraud to obtain your lavish lifestyle? (Okay, that is quite the extreme...but it did happen to Teresa Giudice’s family in The Real Housewives of New Jersey).
Due to the fraudulent activity of the Giudice’s family, their children have to visit their father in jail and they have to deal with a broken in family in the public eye.
Maybe you are nowhere near this extreme, but this is a societal problem in modern times. In instances like this, where we think it is better to lie about our finances to save our luxuries-- it is time to examine the deeper issues behind the material possessions.
Perhaps they could not let go of their identity as the family with the nicest house, most cars, and best table at the country club.
Perhaps they needed others to feel intimidated of their wealth to ensure that their own self-esteem was indeed high enough.
But what if they knew that money could never instantly buy you a happier relationship, a deeper faith, or stronger convictions?
Happy people are whole people. Happy people invest their time and attention into these intangible items that bring long-lasting value.
The most important habit of a wealthy person is to live within their means. Wealthy people save often, invest into long-term growth assets, and spend wisely.
Most importantly, wealthy people know that riches are not defined on an absolute scale-- but that wealth is relative.
If you are making a million dollars a year, but your expenses are close or equal to your income-- then you do not have a lot of freedom in spending power.
In fact, you are most likely tied to your habitual expenses that you feel stuck in the cycle of working more to pay for more.
What happy people do invest their time and money into is experiences. If you can witness the crash of the sun’s scarlet rays onto glistening blue waters while listening to the aspirations of a loved one-- does it really matter if you are watching from a private yacht or an innertube?
If you are tired of going through the motions, and are genuinely ready to find true happiness and peace of mind with your finances-- then you are in the right place.
We invite you to commit to our challenge: “30 Days to Change Your Life.” This week, we begin discussing The 4x4 Happiness Model® with Coordinate I: Finances.
Sign-up for our weekly “5 Habits of Happiness” as we will leave you with even more expert advice.