Money’s Place in Personal Happiness

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Max Lata

Professor Deanne Harper

Writing 5 – Pursuit of Happiness

6 March 2017

Money’s Place in Personal Happiness

Society drills adages into its citizens’ heads from a young age. “Two wrongs don’t make a right.” “Good things come to those who wait.” “The pen is mightier than the sword.” People say these things without thought or qualification, accepting them as truth because of early indoctrination. But if two wrongs don’t make a right, why do many states still have the death penalty? If good things come to those who wait, why do we reward those who go out of their way to achieve instead of those who lie in wait? If the pen is mightier than the sword, why does our government spend exorbitant amounts of money in defense and not instead on peace treaties? Such traditional advisory one-liners are simply not long enough to be applied liberally across all examples. Similarly, “money can’t buy happiness” fits imperfectly. People point to the seemingly paradoxical “unhappy millionaire” to prove the time-held saying, but the analysis stops there. No further questions are asked as to why that millionaire is unhappy or if happy millionaires exist as well, maybe even in greater abundance. “Money can’t buy happiness” needs repackaging. A strong, unwavering sense of self allows money to be an effective tool in achieving happiness, but without it, money leads to dissatisfaction.

This essay tackles many questions, but to tackle them, it is necessary to prove the existence of the four cases resulting from a cross between happiness and its opposite as well as rich and its opposite. From these four examples, we can more easily isolate the effect of money on happiness.
The Unhappy Millionaire

The unhappy millionaire is not a foreign concept; they have existed throughout history, but Swedish computer programmer and entrepreneur Markus Persson presents a more modern example. Persson created the block-based video game Minecraft, which has seen massive success and has won multiple awards since its 2009 launch. Persson coded the game by himself in the beginning and continued to be heavily involved with the game until 2014 when he sold Minecraft and its production studio to Microsoft for $2.5 billion at the young age of 35. After legal fees and paying old employees, Persson is still worth a little more than half of the sale at $1.4 billion. With newfound riches, Persson christened his affluence by outbidding Beyonce and Jay Z for a 23,000 square-foot Beverley Hills mansion at $70 million, but despite the riches and luxuries, Persson was unhappy (Isidore). He publicized his dissatisfaction on Twitter. “The problem with getting everything is you run out of reasons to keep trying, and human interaction becomes impossible due to imbalance” (Persson). “In sweden, [sic] I will sit around and wait for my friends with jobs and families to have time to do shit, watching my reflection in the monitor” (Persson). Persson was unhappy not because he had money, but because what he craved was not for sale: personal interaction. After selling his company, Persson was no longer working with people, something he enjoyed, he had free time; yet, without an outlet for it, it simply became hours of self-reflection on his unhappiness. He could not buy time with his friends to fill the time and his life because they had lives to live themselves. These actual instances may have made him unhappy, but why they made him unhappy is the subsequent question.

The first half of his first tweet hones in on the root of such dissatisfaction. When Persson typed out “everything,” it may have been melodramatic, but it also identifies the problems in his perception of money. Persson did receive billions of dollars, but billions of dollars are not “everything.” The rest of the first half unearths further fundamental issues; the claimed lack of “reasons to keep trying” shows that Persson thought success was the endgame and key to happiness, that once he had money, he would be happy and there was nothing else to it. As will be discussed later, happiness is not achieved once and held onto forever but nurtured continuously by smaller events and actions. Persson was misguided by societal cues toward happiness, or rather, he misconstrued someone else’s perception of happiness as his own, like in the purchase of the mansion. Because he expected to feel happy but did not, he felt just the opposite. The crushing of expectation, not money, led to unhappiness, but to further prove this fact, examples of happy millionaires exist as well.

The Happy Millionaire

In his essay “Living with Less. A Lot Less,” Graham Hill discusses his experiences with sudden wealth but shows that it can also lead to happiness if spent to give personal meaning. Hill’s and Persson’s lives are relatively congruous; both young men, living in socialist countries became nouveau riche through the technology industry, Hill from an Internet start-up and Rubin from a video game. After the men became rich, each of them spent exorbitant amounts of money on real estate (Hill in Seattle and New York while Persson bought the Beverley Hills mansion) and other various gadgets and things to fill up said real estate. Hill also felt the dissatisfaction with life that Persson felt, saying that he felt his life was “unnecessarily complicated” and managing two properties gave him “big headaches” (Hill 309). Just like Persson, Hill was an unhappy millionaire, but unlike Persson, Hill found happiness by having experiences and working meaningfully instead of trying to find it in material things as he had done in the beginning. Hill enabled himself to be happy because he switched his frame of reference from things and began pursuing the things that actually made him happy. This logic, however, presents a problem. When Hill switched to seeking out travel and humanitarian work, he became happy, and that is understandable, but it does not explain why Hill and Persson were so unhappy with a copious amount of things and not simply “not happy.” In other words, what about material things decreased their happiness instead of keeping it at the same level?

Why some Millionaires are Happy While Others are Sad Circling back to adages helps provide an answer to this question. “Good things come to those who wait” leaves people feeling lied to when it is not reality, and they feel cheated when the brute strength of the sword beats the pen. People are told these things, and they believe them to be true, but when they are proven to be false, people become dissatisfied. The average first-world citizen today (like Persson and Hill) is not just engrained with sayings, however, but also ideas. These ideas can come from any number of places like general cultural beliefs (such as capitalism being a positive in the American psyche) or a more modern-day and tangible source, television. In the mid-1990s, right before when anti-tobacco programs became prolific, smoking advertising targeted at youth was high. This advertising increased teenage tobacco use and was demonstrated to have more of an effect on teenagers’ perception of tobacco than even their parents attitude toward the product whether it be positive or negative (Evans et al.). Human beings are fallible and susceptible to influence especially when told something will make them happy, so it is not hard for car and technology companies or Hollywood to send messages that these certain things will make you as happy as the people in their advertisements or films. These messages build expectations, and expectations are key to why Persson and Hill were unhappy with their material things. Their expectations were not met, and thus the two millionaires felt disappointment, an emotion heavily linked to feelings of sadness and isolation. In addition, disappointment leads individuals to try again and again to correct their disappointment, often by simply doing the same thing (van Dijk). Beyond expectations, however, there is a further cause.

As is argued by authors like Mihalyi Czikszentmihalyi and Sonja Lyubomirsky, people, for varying reasons, adapt quickly to wealth. Czikszentmihalyi cites polls depicting people as always reaching for the next income level, no matter if they earn minimum wage or a quarter of a million dollars a year (Czikszentmihalyi 145). Lyubomirsky argues the same idea by introducing the concept of happiness set points: intrinsic, genetically hard-wired and variable base levels of happiness that comprise half of total happiness (Lyubomirsky 183-184). Implied in Lyubomirsky’s idea of set points is this adaptation to wealth. Though sudden wealth in the cases of Persson and Hill may increase happiness for a short amount of time, after time, the individual returns to their happiness set point plus perhaps a little more given Lyubomirksy’s model also factors in circumstance. Given either author’s argument, people adapt to their income level even if it initially made them happy, and this coming down from a high is observed in Persson and Hill. They grew accustomed to luxury, and because they came to expect it, it no longer provided the same feelings it did initially.

Though these individuals were wealthy, not every person, but all people have the capacity to feel happiness and unhappiness, so analysis of other economic quintiles benefits the conversation.

The Poor and Unhappy

Poor and unhappy people exist around the globe, but while it is easy to recognize that citizens in war-torn or totalitarian countries are unhappy for obvious reasons derived from circumstance, identifying the causes of unhappiness in poor first-world citizens presents more insight into the questions at hand. Additionally, “poor” is a subjective, wide-ranging term that can include the lower-middle class. Those with less money but still more than enough for the basics exhibit unhappiness for the same reasons as individuals with more money. As such, Americans living in poverty will serve as the examples of the “poor and unhappy” to more isolate the effect of money on happiness.

In 2015, the poverty threshold for an American family of four was a $24,000 annual income; for reference working full-time minimum wage at forty hours a week for $10 per hour yields an annual sum of $20,800. In 2015, the poverty rate was 13.5 percent, with 6 percent of the total population being in “deep poverty,” defined as having an income at “only 50% of their poverty thresholds.” (“Poverty Facts”).

A shift in focus accompanies such a low income. While the average American citizen may worry about getting gifts for loved ones or planning vacations, an American under the poverty threshold must worry about more pressing, basic matters, like shelter and transportation. Beyond those however, some Americans have to concern themselves with an even more visceral need: food. Close to the rate of poverty, 12.7 percent of American households were “food insecure,” a governmental term for having difficulty providing food at some point during the year. (“Poverty Facts”). The almost one-percent discrepancy is mainly attributed to community service and church groups providing food to low-income families. In households below the poverty line, food and bills are the biggest bringers of stress, problems fixed more easily with more money. Such findings have been studied by various researchers across countries and disciplines.

In a study of American citizens across the country, psychological researchers from the University of British Columbia as well as Michigan State University deduced that money has a large impact on sadness (Kushlev et al. 5). “Sadness” is related to but still separate from happiness. They are not on the same continuum, but discrete categories; however, sadness is felt before happiness. Even if an individual has reasons to be happy, sadness is felt before happiness in an inhibitory fashion. For example, even if someone has good friends, fulfilling work and daily things that make them feel happy, tragedy in their life such as death or sickness in the family will inhibit the happiness that they might usually feel. The study found that people with higher income experience less daily sadness than those with low income, indicating that lower income individuals are sadder and therefore do not experience as much happiness because of money problems.

These conclusions seem to run contrary to Lyubomirsky’s notion of set points. People can adapt to good situations, but they can also adapt to bad situations as well because of their set point. Lyubomirsky’s model, however, fails to include an integral aspect of poverty. While Lyubomirsky acknowledges the human capacity to adapt to good and bad situations, these situations are consistent; living in poverty is to live in uncertainty.

While people can adapt to consistent good or bad situations, they do not adapt as well to uncertainty. The 2008 financial crisis shook the whole nation, affecting not only banks and rates but also happiness. “…[A]verage happiness in the US declined significantly as the Dow fell with the onset of the crisis. Average happiness fell 11% from 6.94 (on an 11 point scale) prior to the onset of the crisis, to a low of 6.19 on November 16, 2008. Yet when the market stopped bottoming out and some semblance of stability was restored in late March 2009, average happiness recovered much faster than the Dow” (Graham). The uncertainty in the market caused a nationwide drop in happiness, showing that uncertainty plays an impactful role even for individuals with money. Living without money, however, breeds even more uncertainty, causing more sadness and less happiness.

Both Kushlev and Graham came to the same conclusion after demonstrating that uncertainty due to a lack of money caused unhappiness. Kushlev found that while a lack of money did make people sad, it did not affect how happy they were in response to stimuli. In the two-categorical sense of sadness and happiness, this means that while a lack of money affected the sadness column, it had no bearing on the happiness one. Graham used the same Dow versus happiness data to draw a similar conclusion. By June 2009 it was higher than its pre-crisis level: 7.15 on June 21 - even though living standards and reported satisfaction with those standards remained markedly lower than they were prior to the crisis. Once the period of uncertainty ended, people seemed to be able to return to previous happiness levels, while making do with less income or wealth” (Graham). In short, money does not affect how happy can be, but rather how quickly they might achieve it.

The Poor but Happy

Different from the more developed, westernized homelands of Hill and Persson, Latin America presents an example of another money-happiness intersection: poor and happy. Despite their lower GDPS and higher crime rates, people in Latin American countries are remarkably happy. In 2011, Gallup’s study on the most positive countries in the world, Latin America took seven out of the top ten (Clifton). Cross-referencing these findings with analysis of the highest homicide rates in the world yields some shared countries in both top ten lists, including El Salvador, number one in homicide but number three in positive emotion (Gagne). Crime is oftentimes a deterrent for happiness; U.S. News’ rankings of the best places or happiest places to live usually give crime weight in their calculations. How are Latin Americans still happy even in the face of crime? The answer lies again in adaptability, which allows people to not only adapt to the good but also to the bad, so Latin Americans are still happy in the face of crime because the face of crime is large. Case studies in other countries have observed this exact phenomenon. “Our findings on the effects of both crime and corruption in Afghanistan

support the adaptation hypothesis. Neither crime nor victimization due to corruption

have significant effects on people’s reported well-being in that country … because people are used to both” (Graham 123). As discussed earlier, these findings fit in with Lyubomirsky’s set-point model with individuals also adapting to bad situations and returning to their set point.

Show Me the Money

The four discussed cross sections of the wealth and happiness scales demonstrate that money does not affect happiness levels; having money does not equate to a higher level of happiness but rather how quickly an individual can achieve happiness.

To start, happiness needs to be examined by asking a clichéd question: what makes us happy? And to give a clichéd answer: a lot of things. Economists, philosophers, psychologists, anthropologists and a host of other experts have grappled with the question for centuries. Aristotle’s theories were voiced almost 300 years before the first century while experts discussed in this essay have done research as late as 2015. They have never come up with an answer, or rather they have never come up with one answer. Aristotle asserted a camp of thought that emphasized noble activities as the key to happiness, a position echoed by modern experts. Martha Nussbaum emphasized happiness derived from “unimpeded” activity as well as Czikszentmihalyi with his concept of “flow,” losing yourself completely in an action like composing music. Lyubomirsky also hints at something similar by asserting that 40 percent of happiness is influenced by “intentional activity,” working toward a goal.

And yet, researchers have also emphasized relationships. The 75-year-long Grant Study by Harvard University has followed Harvard alumni for a long time span, and its sister study the Glueck Study has done the same with inner-city youths in the Boston area. In conjunction, the two studies have examined two distinct income levels, but come to the same conclusion that happiness lies in relationships with other people. A study out of Framingham Massachusetts has corroborated these findings by analyzing subjects’ relationships with other people to construct a map of people. The study found that people with happier friends and acquaintances tended to be happier themselves (Fowler and Christakis 5).

Experts are not the only authorities in the discussion of happiness; they might not be happy themselves. Happy individuals have put forth varying routes to happiness as well. Hill, the happy millionaire discussed in this essay, attributes his happiness to travel, meaningful work and loving relationships. On the other hand, Gretchen Rubin, author of The Happiness Project, test-drives studies and theories on happiness via her blog and books. In her essay “July: Buy Some Happiness” that splurging on oneself with meaningful things, both material and abstract, can lead to happiness. Finally, there are studies that espouse the benefits of exercise and religion for their regularity as rituals (Mochon et al. 329-336). Given happiness’ subjectivity, there is no reason these theories cannot be reconciled. Just like how Lyubomirsky’s set points vary from individual to individual, the cause of happiness varies as well, but across all of these cases, money can facilitate the journey to happiness. Hill could never have travelled as vastly as he did or founded so many of his start-ups without money. Just as Rubin could not have afforded to buy as many of the things that made her happy without money.

Even the more abstract paths to happiness like activity and relationships can be helped along by money. Activity can lead to happiness, but there is no way of knowing that activity before starting it. That activity can be any number of things, but the fact is that the composing that Czikszentmihalyi emphasizes requires more of an investment in instruments, music lessons and time than running every day, an activity that needs just a pair of running shoes. As such, having more money opens up more potential avenues and activities that can lead to happiness, avenues and activities that may have financial blocks to poorer individuals.

As for relationships, a higher income is associated with more time to spend with other people, as long as the individual does not solely pursue money, detracting from that time. Along with that time, money enables people to have more experiences with other people and allows them to potentially discover or continue experiencing those things that already make them happy, like vacationing together or sharing a nice meal.


“Money can’t buy happiness,” like many adages, is correct enough, but it fails to paint the whole picture. Money grants the individual security, which helps decrease unhappiness, but not necessarily increase happiness. Happiness can exist without money so long as the individual’s basic needs are filled because happiness varies from person to person in causation as well as strength. In this regard, however, money enables the individual to explore more paths to happiness like expensive food, more frequent travel or vacations with family. If money is spent on the wrong things, breeding expectations to be disappointed, it leads to unhappiness. This is not to say, in the vein of adages, that “money is the root of all evil.” One of Persson’s followers was quick to mention that he must have regretted his business decision to sell the company, but Persson quashed this suggestion. “You're completely wrong. Selling out was the best thing I ever did” (Persson). Persson did not regret the money; he regretted that it did not make him happy like he thought it would, but hope is not lost in situations like these. Self-reflection is integral to happiness, and to achieve constructive self-reflection, people must be curious enough to try new things that may bring them happiness.

Works Cited

Clifton, Jon. "Highest Positive Emotions Worldwide." Gallup, 19 Dec. 2012. Chart.

Czikszentmihalyi, Mihaly. "If We Are So Rich, Why Aren't We Happy?" 1999. Pursuing Happiness, compiled by Matthew Parfitt and Dawn Skorczewski, Boston, Bedford/St. Martin's, 2016, pp. 140-56.

Gagne, David. "2015 Homicide Rates for Latin America and the Caribbean." InSight, 14 Jan. 2016. Chart.

Graham, Carol. "Adaptation Amidst Prosperity and Diversity." World Bank Research Observer, vol. 26, no. 1, 1 July 2010, pp. 105-37. Academic OUP.

---. Happiness Around the World: The Paradox of Happy Peasants and Miserable Millionaires. Oxford University Press, 2009. Google Books.

Hill, Graham. "Living With Less. A Lot Less." 2013. Pursuing Happiness: A Bedford Spotlight Reader, by Matthew Parfitt and Dawn Skorczewski, Boston, Bedford/St. Martin's, a Macmillan Education imprint, 2016, pp. 308-12.

Isidore, Chris. "The melancholy billionaire: Minecraft creator unhappy with his sudden wealth." CNN Tech, CNN.

Kushlev, Kostadin, et al. "Higher Income Is Associated With Less Daily Sadness but not More Daily Happiness." Social Psychological and Personality Science, digital ed., pp. 1-6.

Mochon, Daniel, et al. "Getting Off the Hedonic Treadmill, One Step at a Time." Pursuing Happiness, compiled by Matthew Parfitt and Dawn Skorczewski, Bedford/St. Martin's, 2016, pp. 324-36.

Nicola Evans, Arthur Farkas, Elizabeth Gilpin, Charles Berry, John P. Pierce; Influence of Tobacco Marketing and Exposure to Smokers on Adolescent Susceptibility to Smoking. J Natl Cancer Inst 1995; 87 (20): 1538-1545

Persson, Markus. "In sweden, I will sit around and wait for my friends with jobs and families to have time to do shit, watching my reflection in the monitor." Twitter, 29 Aug. 2015, 5:51 a.m.

---. "The problem with getting everything is you run out of reasons to keep trying, and human interaction becomes impossible due to imbalance." Twitter, 29 Aug. 2015, 5:48 AM.

---. "You're completely wrong. Selling out was the best thing I ever did." Twitter.

"Poverty Facts." Poverty USA, United States Conference of Catholic Bishops.

Van Dijk, Wilco W. "Dashed hopes and shattered dreams: on the psychology of disappointment." UvA Dare, University of Amsterdam, 1999.

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