The age old question: can money really buy you happiness? To answer this using my favorite line of all time… “money can buy you a jet-ski and have you ever seen anyone unhappy on a jetski?”
Often the answer considered to be “right” is no, but studies have shown that wealthy countries are far happier than poorer countries, and wealthy people in wealthy countries are happier too. Money does make people happy, it’s just a question of how it is used to ensure the maximized affect. This can largely fall into two categories, buying expensive things or experiencing things.
Let me dive a little further into these two.
Buying Expensive Things
Is there a place in the world for a $10,000 handbag? This was a question floated to me over drinks on a Friday night. My almost immediate answer was “no, I would rather spend it a holiday”. This was followed up with “but what if you had enough money for both the handbag and the holiday, would you buy the handbag?” Again I responded no, this time giving the fear of carrying around something that expensive as my answer (which is probably a lot closer to the truth).
As a person I am known to be clumsy, and at times careless. In addition to that, I get bored of fashions quite quickly. If I am to invest $10,000 in a handbag (and let’s face it, this is an investment) then I need to a) want it so badly that I can’t imagine going on without it and b) look after it so well that it will never touch the ground/always have its own chair at a dinner table. And that goes for everything fashion related, watches, sunglasses, jewelry etc. I just don’t feel I have the necessary commitment required to own any fashion accessory of this value.
Also once you have bought one item, where does it stop? As someone pointed out, if you were going to buy designer handbags, you would like a couple, different ones for different occasions (as is the case with fashion in general), and then how many would be enough? Would you be happy with 5, 10? Or would you be happy when the latest style was released and you still had yours from last season?
Evidently, happiness brought by such objects can wear off. If you love a designer handbag, you buy it. The first few times you use it, you are filled with pride and enjoy the admiration from others, leading you to feel happy. But as time goes on, you get use to it, and it becomes the new normal, irregardless of how much you spent on it in the beginning.
That is not to say there aren't items you can buy that keep you happy for a lot longer, for example buying your first house (or any house for that matter). You've struggled and scrimped to gather enough money for a deposit on a house of your own. Something that is all for you, and for (hopefully) the foreseeable future. This for me turns into an expensive thing that will lead to an abundance of experiences and therefore bridges the gap between purchasing and experiencing.
Experiencing Things
Spending money on less physical items and more on experiences is the way in which I find happiness (and probably explains why I don't really have many things). Give me a holiday over a handbag any day. And apparently I am not alone, this feeling that happiness isn't your possessions or your career status, is most prominent amongst those of my generation, where we are spending increasingly more time and money on high value experiences such as concerts, sporting events and social events.
This is because an experience takes a larger chunk of us than material goods. I mean, you can definitely love your stuff and what is says about you and your personality, but they are still a separate entity to you. Experiences on the other hand are what makes you, you. Each individual is a collection of the things they have experienced.
A study conducted by Gilovich showed that even negative experiences become positive, as once they have had a chance to share their assessment of an experience, something that might have been stressful or scary in the past becomes a funny antedote to tell at a party, or be looked back on as a character building experience.
In addition, sharing an experience with someone is more likely to develop a relationship over shared consumption. For example, you are more likely to feel a connection with someone you went on holiday with, over someone who has the same flat screen TV as you.
There is also the idea that it is far easier to be competitive over material goods that experiences as you can compare features (how many carats is your ring? What spec is your phone?), and overtime I have learnt that actually money is probably one of the most important factors in life, and can be big in determining friendships.
Character Defining...
Money builds and can determine character, and how this is portrayed outwardly can say a lot about an individual. I recently read this book called China Rich Girlfriend, which is all about wealth and gave an interesting concept. It distinguished between those who had been born into a wealthy family (old money), and those who worked in order to become wealthy (new money). In the book, old money was considered far greater than new money, and many of those who fell into “new” were snubbed. It appeared that working your way up was not as highly considered as being born with a silver spoon in your mouth.
Very broadly speaking the impact of money on a person falls into one of two categories, those who are rather ostentatious and those who are humble.
The ostentatious are ones who are likely to drop in the price tag of items despite not being specifically asked, or who like to boast about what they have in order to outdo their companions. Often this can be done without awareness, mainly because they have been brought up with this style of conversation and it is completely normal for them. On occasion it may be due to insecurities or worries about having less to offer in a conversation, alternatively it can just be showy.
Humble people are those that have no desire to boast or gloat about what they own. This is refreshing as it goes to show they have a multitude of experiences and adjust their conversations styles in accordance with their audience. This tends to warm a person to their character and it can be easy to walk away without knowing they are multi-millionaires, as they have so many other character defining attributes.
I am lucky enough to have experienced both these types of people, but naturally congregate to people of a similar mindset (note: not necessarily the same wealth bracket), in that the cost of something won't prevent me from doing it, but I will be doing my research to ensure I am not unnecessarily throwing money away. (Also I get a real pleasure from a brilliant bargain, it feels like a personal achievement, honestly.)
A Final Thought...
Experiences are enjoyable but can mean we walk away with nothing physical to show for them. This isn’t necessarily a bad thing, as happiness for many is other people. Experiences tend to be shared, firstly at the time they happen and then repeatedly as the stories are told amongst friends and family. The strength of these experiences can also be determined by the types of people they are shared with. It's likely you will enjoy things with people more like yourselves, and you're more likely to connect when you feel you have more in common with one another.
Whilst I like to think of myself as more of an experience based person, if someone was to buy me a $10,000 handbag, I wouldn't turn my nose up at them... (I'd probably cry/shriek/panic/faint) - any takers?
This is quite a controversial and opinionated topic in general and my thoughts are a little scattered, but I would be really interested to hear what you thought about money, happiness and related characteristics – feel free to drop me a note!
