The Price Of Happiness: $75,000

Pop culture might want us to believe that the best things in life are free, but two Princeton economists beg to differ.

Inc.com has more on what Nobel Laureate Daniel Kahneman and his colleague Angus Deaton discovered in a new study:

Not having enough money causes emotional pain and unhappiness, the researchers found. But the happiness tipping point is about $75,000 - more money than that doesn't make a person cheerier, though it can help people view their lives as successful or better.

Kahneman and Deaton distinguished between life satisfaction and joy by asking people to assess how happy they were on the previous day, and found that there was no difference between daily happiness levels of individuals making more than $75,000 per year.

The study echoes University of Illinois Professor Ed Diener's global research on the same topic, the results of which were reported in July. According to the Washington Post, Diener found that while the relationship between money and satisfaction is strong and universal, the relationship between wealth and positive emotion is more complex.

The Post explains:

"...a key element of what many people consider happiness -- positive feelings -- is much more strongly affected by factors other than cold, hard cash, such as feeling respected, being in control of your life and having friends and family to rely on in a pinch."

Is $75,000 enough to make you happy? Weigh in below.

Comments

[Palaver]

12:06 PM on 09/09/2010

I read somewhere, _Luxury Fever_, that it was only twice the poverty line. You would only be slightly happier after that. The fluctuations in your mood, however, remains the same. Hard to get some people off their misery cycle, I suppose... lol.

[SF TKF]

11:40 AM on 09/09/2010

$75K (as a gross salary) in San Francisco and $75K in Stockton are not even vaguely the same thing . . . $75K in SF is barely a living wage. If you had NO other bills (no car, no student loans, no credit cards), you MIGHT be able to rent a one bedroom apartment. Heavy emphasis on the MIGHT.

[drkazmd65]

12:14 PM on 09/08/2010

Depends on the other financial contex of that $75K.

With no unmanagible debt, with good health for myself and my wife, and with an otherwise stable economy, jobs, food and fuel prices, $75K would be a good base even in the DC metro area.

Otherwise, $75K is not as much as it seems to be.

[berserk]

12:04 PM on 09/08/2010

I know 75,000 would make my dreams come true right about now. For a single woman with no kids that much money would allow me to travel more, donate more to charity, get a reliable car, finish off my student loans, start on my second degree comfortably, go to comic con 2011 and update my wardrobe.

[TonyVote]

11:35 PM on 09/08/2010

i think they're referring to $75k a year though. but sure, up front, that would make anyones life happier.

[berserk]

05:44 AM on 09/09/2010

I know.

[davidnowell]

11:02 AM on 09/08/2010

Glad to see this relationship re-examined…I’ve been citing an older study which, obviously came up with a lower salary/happiness ideal point. There’s no getting around the money-happiness relationship. After basic needs are met, though, I’m convinced that two things matter the most: knowing what exactly we want to feel/experience, and then organizing our commitments and relationships around that self knowledge. Wanna spend a whole weekend talking about this? http://bit.ly/9go6cz

[cooket]

07:04 AM on 09/08/2010

all I want to be able to do is swipe my card on a pretty date and worry about it not being declined. lol

[gtoddyt5]

03:45 PM on 09/08/2010

Literally? hahaha

[cooket]

07:35 AM on 10/02/2010

lol.... now that you mention it.... yes. bwahahahaha

[FPhoebe]

11:41 PM on 09/07/2010

All I want is to be able to pay my necessity bills every month and not have to worry about whether I'll have enough to scrape by, and a job I like going to each day. I'd also like to be able to take care of my mother when the time comes. I don't care how much I make as long as I can do those things.

[spidey25]

11:01 PM on 09/07/2010

Throughout my life, I've earned everything from below minimum wage, to just over the stated figure (and back again). And to be honest, nothing really changed much. My happiness came from deciding what I wanted to do with my life, and concentrating on that.

Eating well, enjoying my hobbies, having good friends and exercising made me feel a lot better than money ever did.

I'd love to hear what everybody else thinks.

[drkazmd65]

12:17 PM on 09/08/2010

I think you have hit the nail precisely on the head spidey. Money isn't that important - unless you don't have enough of it to meet basic needs.

Money does not = Life satisfaction once those basic needs have been met.

[TonyVote]

11:37 PM on 09/08/2010

like @drkazmd65 said, "you have hit the nail precisely on the head." Money isn't everything, it's the people and events that surround you that make life worthwhile.

[Arrive2 net]

07:22 PM on 09/07/2010

$75,000/year could be the a good number, however its difficult to conceive that this same number would apply to the entire US because there are tremendous differences in cost-of-living in different cities. $75,000 might be a tremendous income in Topeka or Tulsa, but not overwhelming Northern Virginia, LA, or NYC.

Bernard Schuster
Arrive2.net

If the research is correct then it is another good reason to graduate from college, income-wise, it may help you get closer to happiness. On average, grad school may get you even closer, according to: http://www.census.gov/prod/2002pubs/p23-210.pdf.

Bernard Schuster
Arrive2.net

[D Reed]

06:18 PM on 09/07/2010

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