Can money buy happiness?

In a study published in Psychological Science, Kathleen Vohs found that when people are reminded of money they become anxious, less likely to help others, donate to charity or spend time with their friends and family. While a certain amount of money can contribute to an overall level of happiness, once that threshold is reached, money’s impact on happiness becomes tentative.

The antidote to this, unsurprisingly, is reaching out to others. In fact, research consistently indicates that money can only stimulate feelings of happiness if it is used to help other people. Psychologist Elizabeth Dunn conducted interviews with a range of employees from varying pay grades and found that those who spent their bonus money on other people were happier than those who spent the extra money on themselves. This response was found throughout all of the study’s participants, regardless of the size of their income.

The principle behind this is very straight-forward. Humans are, and have always been social creatures, relying on others in order to survive. When we use our resources to help those around us, our brain rewards us for strengthening relationships by releasing the hormone oxytocin. Among other things, oxytocin – dubbed the ‘love hormone’ – reduces stress and anxiety and leaves us feeling relaxed and satisfied.

The pursuit of money for the sake of money is unconducive to any sort of a business model – a rebel entrepreneur knows that if they follow wealth, and not their dreams, their passion will die along with their business. However, if they focus on how their product or service may make the lives of others better or easier, they tap into instincts that are hardwired into our brains, and, as a result, they are awarded with happiness as well as financial wealth.