“As a happiness researcher, I am pleased to share the results of one of the largest and most diverse studies on this topic,” Dr. Dunn said. “One of the novel contributions of the study is that we can estimate the relationship between these spending choices and happiness due to the substantial sample size and diversity. Our results show that across all demographic groups , spending money on others is strongly linked to happiness.
The more than 60% of participants who said they had donated to charity in the past month appeared, on average, to have higher levels of subjective well-being, a measure of happiness, compared to those who didn’t. have not donated to charity. In fact, the relationship between individuals donating to charity and higher levels of happiness was equivalent to earning $36,000 more income, or an almost 6% increase in happiness.
The link between charitable donations and happiness varied across age groups, with older participants reporting the strongest link to happiness. Yet even for young adults, the association between giving to charity and happiness equated to winning $25,000 more income, or a 4.25% increase in happiness.
The study also shows that personal income has no impact on the relationship between giving to charity and happiness. For participants living below the poverty line, donating to charity was linked to increased happiness equivalent to $22,000 more income, a 3.73% increase in happiness. Additionally, people living paycheck to paycheck reported feeling happier, which equates to earning $30,000 more income, or about a 5% increase in happiness.
Remarkably, even participants who thought spending money on themselves would lead to greater happiness reported higher levels of happiness if they donated to charity.
Just under half (47%) of participants said they made time-saving purchases, such as hiring housekeepers or ordering food delivery, in a typical month. People who spent money on time-saving purchases reported higher levels of happiness, which equates to winning $14,000 more income – compared to those who did not.
Time-saving purchases seem beneficial even for people who struggle to make ends meet. Participants living paycheck to paycheck reported higher levels of happiness when they made purchases that save them time, which equates to earning $12,000 more income, an almost 2% increase in happiness.
Even for people who prioritize money over time, there is a link between greater happiness when using money to save time, which equates to winning $20,000 more income. This unintuitive finding suggests that people who chronically value money over time might benefit from the recommendation to use some of their money in order to have more time.
“The goal of the new research was to determine whether the links between happiness, prosocial spending, and buying time vary across individual characteristics, such as age, gender, and income,” said Dr. Dunn. “Those interested in this study and its findings can be more confident knowing that people engaged in prosocial spending and time-saving shopping report being happier because this is the largest study ever conducted examining the links between these spending choices and the happiness of Americans.”
** The study, co-authored by Dr. Elizabeth Dunn and doctoral student Iris Lock, surveyed an economically diverse sample of 15,545 American adults who had previously applied for a loan from Happy Money. Participation was voluntary. To differentiate the study from others, participants were asked about their subjective well-being, consumption behavior, personal values and beliefs, and demographics, including age, gender, and income. The average age of the sample was 37.40 years, with 79.25% identifying as female, 20.28% identifying as male, and 0.46% identifying as neither female nor male. man. The median income was $46,117, and 88.64% of the sample reported living paycheck to paycheck. Prosocial spending was measured by assessing whether people spent money on others by asking if they had donated to charity in the previous month. To assess whether people spent money on time-saving purchases, participants were asked, “In a typical month, do you spend money on time-saving purchases? ?” Income level equivalents were derived from the correlation of happiness and income based on the data set of 15,545 respondents.
About happy money
Happy Money is a fintech company valued at over $1.1 billion which provides a people-focused lending experience in partnership with credit unions and other community-focused financial institutions. Building on the success of our credit card debt reduction product, The Payoff Loan™, Happy Money also offers personal loans to help people finance their dreams and goals – from big bills to home improvement projects. home. We believe that money can be a tool for happiness; it’s all in how you use it. Through automation and proprietary underwriting models, we personalize the loan process, taking a more holistic view of an individual’s creditworthiness to offer flexible pricing and payment plans that best suit their circumstances. single financial.
Through our exclusive distribution channels and platforms, we aim to connect our financial partners to be stronger together, help them thrive in an increasingly digital world, and enable them to deliver the ultimate lending experience. happier than their customers want. Backed by leading investors, Happy Money has helped nearly 250,000 members since its inception – working with lending partners to fund $4.5 billion in loans*. As a fully distributed company, Happy Money has a passionate and driven employee base of over 400 people across United States. For more information, please visit happymoney.com.
SOURCE Good Money