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Why Money Actually Can Buy Happiness (and How)

We’ve all had the experience of coming upon that thing we just NEED to have. After however much or little deliberation (no judgment), we buy it. However, we also all know the moment when the shopping high comes down and the newness becomes normalized. This item is no longer exciting or making you happy.

This is what they mean when they say money can’t buy happiness. Possessions are fleeting, and we have trouble appreciating what we have.

There’s even a term for the phenomenon of “money misery,” describing the feeling of never being satisfied; in our society, we never feel like we have enough — enough clothes, enough Instagram followers, enough money. Once we reach a goal, we immediately make a new one. And all of that can be attributed to this chase for more money.

But what if we rewired our idea of the happiness and money relationship to think that more money does not equal more happiness, but instead, the money you already have can be rearranged and budgeted to help you be happy? No matter your income, money can be used to give you a healthier, easier lifestyle, depending on what is best for you. And that’s bound to make you happy. Here’s how to use your money to buy happiness (kind of):

Buy Experiences

Sometimes it can be hard to spend money on these bigger budget items. Buying a $15 lunch a few days a week seems much less daunting or scary than a $1000 trip. But guess what — buying $15 lunch just 3 days a week adds up to over $2000 a year. So if you’d rather a trip than your takeout habit, budget accordingly, and then actually plan the trip, no matter how scary a big sum of money at once may seem.

Spending your money on traveling or classes in something you’ve been wanting to learn, like a cooking class or learning a musical instrument, has clinically been proven to increase feelings of contentment with your life.

Bonus happiness: spend your money on experiences with someone you care about. Getting to experience something like a trip, a concert, or a class with a loved one is shown to not only increase emotional connection, but might also become memories and photographs that mean a lot to you. This also goes for gifting too — if your sister’s birthday is coming up, don’t just buy her a pair of shoes you know she’ll like or a nice candle. Buy tickets for the two of you to a festival she’d love or a concert with her favorite artist.

Not only will you have a lot of fun together, but the experience will mean more to her, long after the candle would’ve gotten lost on her shelf or the shoes would’ve worn out.

Make It a Treat

Many residents of London have never visited Big Ben. What stops them? When something wonderful is always available, people are less inclined to appreciate it. Limiting our access to the things we like best may help to renew our capacity for pleasure. Rather than advocating complete self-denial, turn your something favorite into a special indulgence instead of a daily necessity.

Give yourself the indulgences that will actually increase the quality of your life and wellbeing, because these are the things worth saving money for as long as you budget for them.

Buy Time

Before buying something, ask yourself “how will this purchase change the way I use my time?” When people focus on their time rather than their money, they end up choosing activities that benefit their will-being. By permitting us to outsource our most dreaded tasks, from scrubbing toilets to cleaning gutters, money can transform the way we spend our time, freeing us to pursue our passions.

Don’t feel bad spending your money on things that you could do yourself because it not only would eliminate those chores from your regular to-do list, but will give you more free time. And then spend this time wisely — don’t use the extra few hours sitting around and watching TV. Learn something new, catch up on work, spend time with your kids or the friends that make you happy.

Pay Now, Consume Later

In the age of iPad, products are available instantly and our wallets are lined with plastic instead of paper. Digital technology and credit cards have encouraged us to adopt a “consume now and pay later” shopping mind-set. By putting this powerful principle into reverse, you can buy more happiness even as you spend less money. Because delaying consumption allows spenders to reap the pleasures of anticipation without the buzzkill of reality, vacations provide the most happiness BEFORE they occur. And reserach shows that waiting, even briefly, for something as simple as a Hershey Kiss makes it taste better when we get it.

The benefits of delaying consumption are particularly likely to emerge when we pay upfront. By paying now and consuming later, purchases ranging from makeup to mojitos can be enjoyed as though they were care free.

Even better, people are less prone to overspend when they experience the pain of paying up front. This pain can put them on the path to decreasing debt, which provides one of the best routes towards increased happiness.

Invest in Others

New research demonstrates that spending money on others provides a bigger happiness boost than spending money on yourself. “And this principle holds an extraordinary range of circumstances,” says Elizabeth Dunn, an associate professor of psychology at the University of British Columbia and author of Happy Money. “from a young college student buying a scarf their mother to a woman buying a lifesaving medication for a friend’s child.”

When prosocial spending is done right–when it feels like a choice, when it connects us with others, and when it makes a clear impact–even small gifts can increase happiness, potentially spurring a domino effect of generosity. And it doesn’t stop at just making you feel happier, investing in others can make individuals feel healthier and wealthier too!

Bonus Happiness: Create a monthly line-item in your budget just for giving. Even something small as spending $10 to pay for the car behind you at the drive-thru to bigger expenses like sponsoring a local family for the holidays can make huge impacts in our world. And who wouldn’t be happy about that?!

So sure, you need to save up and be financially smart about the future, but life is meant to be enjoyed. Don’t feel guilty if you do spend a bigger sum of money on a vacation or a gym membership (for your sanity). If it fits within your budget and you know you can afford it, think of it as investing in your happiness. If all we’re doing is working and not really living, what kind of life is that? Be smart, budget, and most importantly, live the life that makes you happy.

Do you think money can buy happiness? What are your budgeting tips that allow you to spend money on the things that make you happy? Tell us in the comments.

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