How Much Money Does it Take for You to be Happy? - P.O.W. Report

Friday, June 22, 2018

How Much Money Does it Take for You to be Happy?

Happiness isn't a new topic for POW Report, I've written about it [here], [here], and even did a [podcast] on the topic.

Before I go into the research on the topic,

What is Your Magic Number?


The number of course varies by the region in America, however for Alaskans that magic number is....

Drum roll

$105K Smackaroos!

This analysis is a part of a broader special research project by Gallup and Sharecare in conjunction with TIME magazine. It is inspired by the seminal work originally conducted by Gallup Senior Scientists and Nobel Laureates Daniel Kahneman and Angus Deaton.

Their August 2010 research concluded that daily emotional experiences among all U.S. adults -- both positive and negative -- improved with household income up to about $75,000 per year before reaching their best respective thresholds. (Kahneman and Deaton published their findings in the Proceeding of the National Academy of Sciences.) [...]

Historically, the measurement of subjective well-being has been divided into two major categories: how respondents evaluate their lives generally and how they experience their lives day-to-day. Stated simply, experiential well-being focuses on recent, momentary experiences while evaluative well-being is more broadly concerned with the way people think about and remember those life experiences more cumulatively, oftentimes long after they have already occurred.

Income influences both of these forms of well-being, but in different ways: The likelihood of experiencing positive emotions on any given day is elevated by income, but only to a certain extent. The more general evaluation of one's current life, however, continues to improve with each successive income bracket. [...]

These results are based on nearly 450,000 interviews with randomly selected U.S. adults across all 50 states and the District of Columbia, conducted from Jan. 2, 2014, through Dec. 30, 2016. Respondents were asked, "Did you experience the following feelings a lot of the day yesterday? How about: happiness/enjoyment/smiling or laughter?"

The results are based on the mean score across each of the emotions/actions for each region after controlling for demographic factors such as gender, age, race/ethnicity, education, marital status, children in the household, previously existing health conditions and day of the week. The number of occupants per household is not controlled for.

It would be interesting to take the survey and break it down by age-group. I have a feeling that the quality of your monetary life really changes drastically by age. Kids (read: Millennials) I feel still have a very ignorant naive outlook on their quality of life. Most Millennials are just happy to have a roof over their head, a working car, a job and (if they are fortunate) a loving partner. However, as you get older and start a family all of a sudden your outlook changes from ALL ABOUT ME to ALL ABOUT THE FAMILY. In which case, I would take a well founded educated guess that the number does in fact jump to the $105k number.

Another study by the journal Nature Human Behavior

...shows that being wealthier isn't necessarily better when it comes to indicators of happiness like long-term life satisfaction and emotional well-being.

In fact, the researchers found that the ideal point — though it varies in different parts of the world — is around $95,000 for life satisfaction, and between $60,000 to $75,000 for emotional well-being.

Beyond that income level, the researchers found that the old adage of 'More money, more problems' actually holds true. [...]

Once you pass the income threshold where purchasing the basic necessities of life, keeping up with loan payments, and having a little extra leftover is reached — starting around $60,000 after taxes for the average individual — people are generally driven by material desires and comparing themselves to others.

That reduces happiness overall, the study says. The amount is naturally higher for families that need to support more people.

To understand how income affects happiness, Jebb and his team took data from the Gallup World Poll, a representative survey of 1.7 million people in 164 countries. The researchers made estimates based on questions around life satisfaction and emotion, correlated with average salary and purchasing power.

I find studies on Happiness fascinating because I feel like we as a whole really lose sight of what it is to be satisfied and content. We often make sacrifices for a higher paying job at the detriment of our spiritual happiness which eventually leads to increased stress and emotional burn out. Is more money really worth it if you have much more stress?

What do you think? Does your number line up with the study?

I'm not going to read into the discrepancy between men and women...maybe i'll save that for another article ;-)  That is only if 5 people ask me to read into it...cause I will....Don't dare me to! 

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