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Money Buys Happiness Only Up to a Point

Money might give youa sense of overall satisfaction with life, but the extra dough won't ensuredays full of laughter and joy, a new survey analysis of income and happiness suggests.

Results showed thatas a person's income increases so does their overall satisfaction with life,but the moment-to-moment enjoyment of those days depended more on social andphysical factors, such as whether a person smoked or spent the day alone.

These findings agreewith a similar analysis of globalhappiness, in which the wealthiest nations, such as the United States,weren't necessarily the happiest. For instance, the United States came in atNo. 26 out of 132 nations on daily happiness. Another study on overallsatisfaction showed those living in the wealthiest and most tolerant stateswere happiest by the measure used in the study. [HappiestStates Revealed]

Happiness surveys

In the new study, DanielKahneman and Angus Deaton of Princeton University took a stab at figuring outwhether and how income affected each of the two well-being types: emotionalwell-being and overall life satisfaction. To do so, they analyzed more than450,000 responses to the Gallup-Healthways Well-Being Index, a daily survey of 1,000U.S. residents conducted by the Gallup Organization.

They looked atpercentage changes in income rather than absolute numbers.

"In the context ofincome, a $100 raise does not have the same significance for a financial servicesexecutive as for an individual earning the minimum wage, but a doubling oftheir respective incomes might have a similar impact on both," the researcherswrote this week in the journal Proceedings of the National Academy of Sciences.

For life evaluation,participants indicated on a scale from zero to 10, from worst to best possible,how they would rate their lives. For emotional well-being, participants answeredyes/no questions about whether they had experienced various positive andnegative emotions a lot during the prior day.

About 85 percent ofrespondents indicated they experienced a lot of positive emotions, including feelingsof happiness, enjoyment and laughter/smiling on the previous day, while 24percent felt a lot of sadness and worry. The average life-evaluation score was6.76 (with 10 being the best possible life).

Physical illness,headaches, loneliness, and caring for an adult were linked to lower emotionalwell-being. Being a college graduate was associated with high life evaluation, butthat diploma didn't do much for daily enjoyment.

The limits of money

Low income seemed tomagnify the emotional pain of life's misfortunes, including divorce, illnessand loneliness. For instance, for those with a monthly income of at least$3,000, 38 percent who reported headaches also reported a lot of sadness andworry, compared with 19 percent without headaches. But headaches seemed to takea greater toll on those making less than $1,000 a month, who reported "bluefeelings" at rates of 70 percent when they had headaches and 38 percent whenthey didn't.

Beyond an average of$75,000, annual income no longer played a role in boosting how happy a personfelt daily.

The researcherssuggest that making anything more than $75,000 no longer improves a person's abilityto spend time with friends, avoid pain and disease and enjoy leisure time - allfactors involved in emotional well-being.

"It also is likelythat when income rises beyond this value, the increased ability to purchasepositive experiences is balanced, on average, by some negative effects,"they write. For instance, a past study revealed a link between high income anda reduced ability to savor small pleasures, the researchers noted.

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