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Money and Happiness – Is there a Link?

It’s said that making more money won’t make
you happier. We find it hard to believe that winning the lottery wouldn’t make
us happier because we could fulfill all of our dreams – the big house, luxury car,
exotic vacations, cool “toys,” etc. But then we hear the stories of lottery
winners going bankrupt and wishing they’d never won the grand prize. According to
a Forbes
article
, lottery winners experience a spike in happiness but
eventually they return to pre-winning happiness levels. Lottery winners aside,
we can probably all think of people who make loads of money and their lives are train wrecks.
Indeed, most studies show that making more
money doesn’t necessarily equate to more happiness…at least after a certain
point. A 2010 study out of Princeton
University
showed that people were happier making more money up to about
$75,000. After that people don’t get much more happy making more money.
Perhaps how much money we make isn’t the
problem. What if the real issue is how we spend our money? Over Christmas break
I read Happy Money – The Science of Smarter Spending by Elizabeth Dunn and Michael Norton. Based on scientific
research the authors show five things we can do to derive more satisfaction
from our spending. I’ll share their five basic points and a few thoughts on
each. If what you read intrigues you then I encourage you to pick up a copy of the book for
yourself.
Buy
Experiences
– Whatever things we buy, we quickly get used to them. For
example, studies show people driving a BMW are no happier with their car than
those who drive a more economical car. However, positive experiences do make us
happier. Think about your home or car then think about some of the great vacations
you’ve taken or major events you’ve been a part of. Odds are you’ll have much
more fond memories of the experiential events.
Make it
a Treat

– As noted above, we get used to things. It’s human nature. People can learn to
endure horrific things to the point where they are not shocked by the
experience. On the flip side we can easily get used to the nice home or car so neither elicits much feeling one way or another. Or how about this – if you visit Starbucks every day for your fancy caffeine fix,
odds are you don’t appreciate at it nearly as much as when you’ve gone without it for some period. The authors contend if we voluntarily cut back on certain
things, making them more of a treat when we do partake, we’ll be happier as a result.
Buy Time – We all have an
opportunity to make more money. The amount we could make might be unlimited but
not so when it comes to time. Studies show spending money on things that might
save us time so we can participate in more experiential things will make us
happier. We can probably all think of a time when we missed an event because we
had to work or do chores. Paying someone to cut the grass or fix the house so
you can attend your kids’ events might be a wiser use of your money. You’ll be
happier for it and so will your family.

 

Pay Now,
Consume Later
– Wouldn’t life be grand if we didn’t have to worry about money?
It might be but that’s not the case and we hate the pain of paying. Paying as
you go is the worst because you might nickel and dime yourself out of things
that could make your purchase or experience much better. And you have the worry of paying
tacked on constantly as you go. Alternatively, you could just “charge it” and not worry
about it. However, throwing caution to the wind and living it up still means
paying the piper when the credit card bill arrives. At that point you begin to
wonder if it was all worth it, which leads to less satisfaction with your purchase and possibly regret.
Studies show that bearing the pain of paying up front reduces the stress during
and after the purchase, which leads to more happiness. For example – think
about going on a vacation where you constantly worry about the price of food,
drinks and activities vs. going to an all-inclusive resort where you paid up
front. At the all-inclusive you’ll probably throw caution to the wind and live
it up much more thereby creating a better experience and happiness.
Invest
in Others
– Jesus told his followers “’Tis better to give than receive.” It
turns out science validates His ancient wisdom. Whether people were given
money or asked to spend their own, those who spent money on others rather than
themselves tended to be happier. And it doesn’t have to be large amounts of
cash. It could be as simple as paying for someone’s coffee. So next time you’re
out, look for a way to make another person’s day a little brighter and your day will
brighten too.
Does any of this tie into influence? I think
so. When you experience positive things with others you build on the liking principle because we like those with whom we share common bonds.
If buying time, making it a treat, and paying
up front make you a happier person, people will enjoy being around you more.
Again, the liking principle is strengthened. Since people prefer to say yes to
those they know and like this should add to your persuasiveness.
And when you invest in others you tap into the principle of reciprocity. Some people you invest in, you might not see again, but then you
never know. Good deeds have a way of making their way back around to those who
initiate them. Giving to others might just come back in an unexpected form at
some point in time. Some people call that karma.
So my encouragement is to give the five spending
pointers a try and see how you feel. You might just be happier as a result and
be a little more influential to boot.
Brian Ahearn, CMCT®
Chief Influence Officer

 

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Helping You Learn to Hear “Yes”.

Acquiring Happiness

I’ll ask for forgiveness upfront because this post isn’t about the science influence. It’s about an exploration of feelings which do influence our choices but this is based solely on a recent experience of mine. Our daughter, Abigail, got her temporary driver’s permit in early August and will get her driver’s license in December. The game plan has been to keep my 1998 Pontiac Grand Prix in good working order – despite rust – so we could give it to her when she was old enough. She’s been a very good, responsible kid and we think she’ll continue that pattern behind the wheel. This summer Jane and Abigail started looking at cars in anticipation of me giving Abigail my car. Not too long ago they came across two really nice vehicles; a 2008 Buick Lacrosse and a 2008 Pontiac Grand Prix. Both were very nice cars and after some online research I felt both were about the best deal I’d get locally. Jane’s heart was set on the Buick but I favored the Grand Prix. The dilemma was that each had attributes the other didn’t. Bottom line; if I wanted the big car luxury feel the Lacrosse was the way to go but if I was looking for a sporty, powerful car then the Grand Prix was the right choice. I settled on the Grand Prix, much to Jane’s dismay, and without going into all the details I’ll tell you two big factors were that I’d had so much good luck with my first Grand Prix and the 2008 Grand Prix had 16,000 fewer miles than the Buick. I think I’m a pretty simple guy because I really don’t want for much. I could have continued driving my old car and been content with it for quite a few more years. Jane and I have lived in the same home for more than 20 years and are very happy. Many things that were original in our home were fine by me but, like many people, once Jane made changes to the house I really liked our home even more. In a similar way, I drove a newer vehicle all of a sudden I felt myself wanting it. Getting a new car was fun but it was a tiring process. It wasn’t just the warm August day that had me tired later on, it was the decision making process, spending a good bit of money, and knowing my choice wasn’t the one Jane wanted. In her defense she was very gracious and told me multiple times she wanted me to get what I wanted because I’d be the one driving it. So why didn’t I feel more excited when I left the lot in my new car? Don’t get me wrong, I really enjoy driving the car! However, I was conscious of the fact that I wasn’t really excited, or at least wasn’t as nearly excited as I thought I’d be. I know I was more conscious of all of these feelings because I happened to be reading a book called Stumbling on Happiness by Daniel Gilbert. Happiness is a subject I wrote about a while ago in a post titled The Secret to Happiness. Here was the strange thing, the thing that really made me happy that day. We happened to be celebrating Abigail’s “Special Day” when I closed the deal on the car. Her special day is a random day once a year where I take the day off and Jane and I give Abigail breakfast in bed, some gifts and then do some of her favorite activities. It was unplanned that I’d end up getting a car on this day but because it worked out I was able to tell Abigail my old car was now her car on one of her favorite days of the year. Here’s what truly made me happy that day; Abigail’s Facebook post said, “Well, since my dad got a new car today, i get his old one! Sooo i have a car now! (: woo hoo”. It would have been easy for her to look at my new car then the one she’s getting and feel some discontentment, but she didn’t. I knew she genuinely appreciated getting the old car and for some reason, even after getting a new car my joy was because I made her happy. The Lord was right when he said, “Tis better to give than receive.” Here’s the really cool thing; we can all be a little happier if we look to give to others. I write about influence and persuasion so I must point out that giving engages reciprocity, the principle of persuasion that tells us those you give to will feel some obligation to give back to you at some point in time. But that aside, the feeling you get having made someone happy, especially someone you love, is more than enough return. There’s no “thing” my daughter could give me that I couldn’t go out and buy myself but you can’t buy happiness and even if you could, it would be more expensive than any of us can afford. Brian, CMCT

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Helping You Learn to Hear “Yes”.