Money and Happiness

http://www.401kcalculator.org/

Last week I talked about experiences vs. things; which make you happier? This got me thinking about happiness and money.

Money is a big deal for me. Making money, saving money, spending money – I think about those things a lot, maybe because I’m the one who pays the bills in our house. What’s the best way for me to use the money I have to give myself a psychological boost?

Buying Experiences rather then Possessions – Every article I’ve read talks about how buying experiences gives us more pleasure in the long run than buying things. Like I said last week, the thrill of buying a physical object fades quickly, but the memory and joy of an experience lingers on. These experiences needn’t be expensive, and they are even more meaningful to us when we share them with friends and family. How about dining out, or going for drinks? Or going for pedicures with your girlfriends? My daughters and I have done that and it’s very enjoyable. It’s our interactions with others that make us happiest. Spend money and time cultivating relationships.

When you do buy possessions, make sure they match your values – If family is your focus, it makes sense to purchase a large dining room table where family can gather for Sunday dinner. I think aligning your spending with your values means spending consciously instead of mindlessly frittering money on things that mean little to you. For me, that meant buying a new desktop computer this spring when mine went on the fritz. Having a working computer is my lifeline.

Give it away – We often derive more pleasure from spending money on others than we do on indulging in things for ourselves. I know I enjoy buying little things for my daughters and husband, just because. Donating to causes we believe in also gives us pleasure. Habitat for Humanity is one of my favorite charities. We’ve given cash donations in the past, and this year after our renovation we donated some items from our old kitchen and bathroom. Instead of trying to sell our old beater car when we got a new one, we donated it to Habitat. I felt really good about that.

Feeling good is better than looking good –Forbes.com argues it makes more sense to buy a $100 pair of jeans and four $100 sessions with your massage therapist than to spend the entire $500 on one pair of designer jeans. Trying to keep up with pricey fashions will only burn a whole in your wallet, and fashions change so quickly it’s difficult to keep up. I’m not one to spend a lot of money on fashion, but I would rather spend my hard-earned cash on yoga classes than on fancy clothes. Yoga makes me feel good, and hopefully look good, too.

Learning lasts a lifetime – Forbes.com also talks about the benefits of learning a new skill. Maybe you want to take golf or tennis lessons. How about learning photography or scuba diving? Spending money to learn a new skill or hobby not only gives you life-long pleasure, it might introduce you to a new social group. For me, this might mean spending my money to attend a writing conference like the 20Book Conference to learn something new about indie publishing and marketing. I don’t think I could spend my money in a better way.

Buying time – How much is your time worth to you? To a busy mother, hiring someone to clean her house so she can spend time with her kids makes sense. For a busy writer, hiring a virtual assistant to free up time for writing is money well spent.

In the end, money can’t buy happiness, but it can buy some things that will make you happy. Don’t forget that when the chips are down, your expensive watch won’t comfort you; only your family and friends can do that.

What do you spend your money on that makes you happiest?