Money and Happiness: Can You Have One Without the Other?
If I could just win the lottery…If I could only get a better job…If I could just save a little money.
Have you ever uttered one of these phrases? I know I have. On these days your happiness seems tied tightly to your money, but is it true? Do you need money to have happiness?
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A Little Science
In a 2010 study published by the National Academy of National Sciences, authors Daniel Kahneman and Angus Deaton found money can buy happiness. To a point at least.
For most of the US, that point is $75,000 a year. After that, there doesn’t appear to be a correlation between money and happiness. There is even a “lottery-winners curse”, which creates misery in lottery-winners life.
So the bad news is you do need some money to be happy, the good news is you don’t need to make millions to be happy. There are a few things you do need to be happy.
- You Need the Basics. You need food, shelter, and water. Without having these basics met for you and your family, happiness might seem very far away.
- You Need to Have Control of Your Money. People who practice habits like budgeting and saving for retirement show much less stress than their counterparts who don’t. Budgeting creates a predictable outcome so there is less to stress over.
- You Need to Use Your Money Wisely. How you spend your money is more important than how much you have. Poor financial decisions can lead to years of turmoil and guilt. Many people invested in products they didn’t understand before the market crash in the 2000’s, and many of them are still picking up the pieces of those decisions. Keep every mom’s wisdom in mind…If it seems to good to be true, it probably is.
If you don’t have the basics or if your budget doesn’t balance there are only two things you can do. Spend less money or make more money. In some cases, you may need to do both.
On Spending Less Money
Saving money where you can is one of the best ways to stretch your money and feel less stressed about the money you do spend. Coupons, Ebates, and Groupon are great ways to save on things you would buy anyway. You can see how much you can save and then treat yourself with a portion of the savings or take your family out for a night on the town.
I do this with my Ebates cash back checks. Ebates pays you a percentage of what you spend at stores it partners with, lots of names big and small, and then sends you a check for the total once a quarter. (To save even more money, you can get cash back from Ebates for using Groupon.) A nice surprise check in the mail each quarter will put a smile on your face.
A word of caution here. Things like coupons, Ebates and Groupon only work if you buy things you were going to purchase anyway. Buying something because it is on sale or because you have a coupon for it does not save you money. This is another reason I love Ebates so much. You earn your cash back for anything you buy from a particular store or site, not one particular item. (Install the chrome extension and your Ebates cash back amount will pop up right away)
There are thousands of other ways to save money, adjust the temperature on the thermostat a degree or two, carpool to work, plan your meals, the list goes on and on.
Look at your budget and lifestyle to figure out where you can save big money.
On Making More Money
Making more money is a bit more complicated than saving money. Making money requires time, effort, and sometimes must be balanced with your family requirements. Still, there are some good ways to make a little bit of extra money if you find yourself short each month.
If you are thinking about getting a second job, or getting a new full-time job to supplement your income, here are a few tips to get you started.
- Investigate the job first. This goes for in-person and online opportunities. Finding out more about the company not only protects you from scams but will give you a leg up come interview time.
- Follow the directions. Recently a friend of mine advertised for an admin-assistant position. She wanted the applicants to provide a personalized cover letter and resume. She even starred and highlighted the request. Out of 230 applicants, 10 followed the directions.
- Balance life and money. This is the hardest part of any job equation. How much money will you make and how much time will it take away from your family. This is a personal choice and as long as you are meeting your basic needs, there really isn’t a wrong answer.
Making more money can ease your burden especially if you are not meeting your three basic needs. To really get yourself out of a hole you may need to make a life plan and stick to it. The results will be so worth it.
Balancing Money and Happiness
The key to balancing money and happiness is in how you spend your money. Stick to a budget so there is no need to fret about your money. Find great ways to save money and then use that money to spend time with loved ones. If you aren’t meeting your basic needs, it might be time for a new job.
Money is a tool. If you use a hammer to smash your fingers you aren’t going to be happy. If you use that same hammer to build a new house, you will be.
What are you favorite money saving tips? Is there a website you love or a technique you use? Leave your ideas in the comments!