Editor’s note: Season 10 of the podcast, “Chasing Life With Dr. Sanjay Gupta,” explores the science of happiness. You can listen to the episode here.
(CNN) Can money buy happiness?
This is an old question that many people, including philosophers, economists, and psychologists, have grappled with.
Rappers are also getting in on the action.
The Notorious B.I.G.’s 1997 song “Mo Money Mo Problems” has a chorus that goes, “More money, more problems.”
Ten years later, the artist formerly known as Kanye West rapped, “Having money isn’t everything/Having no money is everything” in his hit song “The Good Life.”
As the lyrics of both songs suggest, having too much money and not enough money both lead to unhappiness. But few would argue that having a certain amount of disposable income does not lead to happiness.
“The idea that money can’t buy happiness is just completely wrong,” social psychologist Elizabeth Dunn recently told CNN chief medical correspondent Dr. Sanjay Gupta on his podcast “Chasing Life.” Dunn, a professor in the psychology department at the University of British Columbia in Canada, has conducted research that focuses in part on getting the most pleasure from money.
“Money absolutely can buy happiness,” says Dan, co-author of “Happy Money: The Science of Money and the Money that Makes You Happier.” “If anyone tells you that money can’t buy happiness, I encourage them to try giving away some of their money.”
You can listen to the full episode here.
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One famous study from September 2010 hypothesized that happiness increases with income until it reaches a certain threshold (about $75,000), after which happiness levels off. But a reanalysis of that study in 2023, combined with a second study published in January 2021, found that the decline in happiness occurs most often among the least happy people, regardless of income.
Researchers have found that no matter how happy you are or how much money you have, after a good or bad experience, you return to a baseline level of happiness — a concept called hedonic adaptation. “We adapt to a lot of things, right?” Dunn says. “But hedonic adaptation is about[adapting to]happiness, the feeling of pleasure.”
For example, the excitement of buying a new car or getting a raise fades after a while and becomes just normal.
“Increasing your income or receiving a big windfall definitely makes people happier,” she says. “For a while, right? It’s certainly true that when something good happens, we drop back down to a baseline level of happiness almost permanently.”
Dunn said the question is whether there has been a complete return to baseline or whether there has been some increase in well-being.
“There’s this famous study that said winning the lottery doesn’t make you happy, but it turns out that study wasn’t very well done,” she says, “and when you look at the better, larger, newer studies, it turns out that no, winning the lottery is likely to make you happy. And that benefit doesn’t seem to disappear completely even after several decades.”
If you come across that kind of money through a raise, inheritance, or other unexpected income, Dunn says you should think carefully about how you spend it. “Money doesn’t just rain down on us as a drop of happiness,” she says. “We have to find a way to turn it into happiness.”
Here are Dan’s five tips for maximizing the fun of money.
For most people, the joy we get from buying something new fades quickly, but because experiences are temporary in nature, paradoxically, some of the joy lasts, Dan said.
“The idea is that buying things like a trip or a special meal will actually make you happier than buying material things like a couch or a house,” she said.
With that in mind, give up on that 12th pair of trendy sneakers and make dinner reservations at a special restaurant instead.
One way to combat hedonic adaptation is to make the things you buy special.
“Don’t always buy what you like without thinking,” says Dan, “Instead, consider taking a break from the things you enjoy, and you’ll find you get more happiness out of it.”
Dan gave the personal example of buying a kale smoothie, “the most expensive way to eat kale.” At first, buying a kale smoothie was a rare treat that brought her joy. But before she knew it, she was buying them so often that she stopped savoring them.
Dan said that by giving up on “gulping it down,” he has a newfound ability to appreciate these drinks.
The concept here, Dan says, is that you give yourself more time by paying for a service.
“I think the easiest way to do this is to think about whether there’s a job that you hate, that you don’t want to do,” she says. “If so, could you spend money to get out of it?”
Dan said research has found that buying time is a great, but underused, way to turn money into happiness, so instead of spending your Saturday afternoon cleaning the bathroom, mowing the lawn or assembling Ikea shelves, you’re better off hiring someone to do it.
When you postpone gratification, you (almost) forget the cost.
“By paying up front and actually delaying consumption, you can enjoy what you’ve purchased as if it were free,” Dan said.
Plus, just anticipating it brings joy, she added.
Spreading joy, or giving back, is a happiness-centric theme throughout this season of Chasing Life: take the focus off yourself and put it on others.
“Think about spending your money in ways that benefit others, not yourself,” Dan advises. “Can you donate to a charity? Why not treat a friend to dinner? Why not help a stranger in some small, unexpected way?”
Spending money on others can increase your own happiness, she said.
We hope these five tips help you get closer to happiness with your money. Listen to the full episode here: Join us next week on the Chasing Life podcast as we explore what it takes mentally to be an Olympic medalist.
