Can money buy you happiness?

According to an article I found in the Harvard Business School website the answer is YES! What happened to the old adage that money can’t buy happiness?

Michael Norton, from the HBS, and two colleagues from the University of British Columbia found that giving other people as little as $5 can make the giver happier. It is interesting that spending the money on someone else can make us happy.

"Intentional activities—practices in which people actively and effortfully choose to engage—may represent a promising route to lasting happiness. Supporting this premise, our work demonstrates that how people choose to spend their money is at least as important as how much money they make," the researchers explain. "Our findings suggest that very minor alterations in spending allocations—as little as $5 in our final study—may be sufficient to produce non-trivial gains in happiness on a given day."

There were three studies involved. Norton explained, “One of the most puzzling paradoxes in social science is that though people spend so much of their time trying to make more money, having more money doesn't seem to make them that much happier. My colleagues Liz Dunn and Lara Aknin—both at the University of British Columbia—and I wondered if the issue was not that money couldn't buy happiness but that people simply weren't spending it in the right way to make themselves happier.”

They showed that spending as little as $5 over the course of a day on another person led to demonstrable increases in happiness.

They are now looking to work with companies to be creative with how they encourage their employees to spend their bonuses, and companies that are willing to be creative in how they engage in their own charitable giving. “For instance, many companies donate a lump sum to charities each year. Our research suggests that companies might think about splitting that money up among their employees and empowering them to choose the recipient of those donations. We refer to such initiatives as creating a "prosocial workplace," which we believe has benefits both for companies, in the form of happier employees, and for society, through increases in charitable giving.”