Does a higher income mean more satisfaction? Apparently yes, suggests a new study. In contrast to previous studies, she comes to the conclusion that the perceived happiness increases to the same extent even with an annual income of more than 75,000 US dollars. Below this amount, the level of happiness increases mainly due to the decrease in negative feelings such as fear and stress. On the other hand, as income increases above $ 75,000, positive feelings such as confidence and pride increase.
Is it worthwhile to strive for higher and higher incomes in the hope of making you happier? Or does the level of happiness reach a plateau at some point when the salary is sufficient to guarantee a certain standard of living and financial security? Earlier studies assumed that people with an annual income of well over 75,000 US dollars – which currently corresponds to around 62,000 euros – are not significantly happier than those who have this amount available. However, these studies were based on retrospective surveys and only offered the alternatives “happy” or “not happy” instead of offering a differentiated scale. They are therefore only reliable to a limited extent.
Real-time survey via smartphone
Matthew Killingsworth from the University of Pennsylvania has now examined the question of the connection between happiness and salary with a new approach: For his study, over 33,000 working Americans reported several times a day by smartphone how satisfied they were feeling and which positive ones negative emotions they felt. In doing so, they chose their current feelings on a continuous scale. Many of them also answered questions about their general life satisfaction. Overall, Killingsworth evaluated 1,725,994 individual happiness reports.
The result: “A higher income was associated with both greater perceived happiness and greater general life satisfaction,” reports Killingsworth. He found an approximately linear relationship between the level of happiness and the logarithm of income – that is, an increase in income led to an increase in happiness. The extent of the increase in happiness did not change even with very high incomes. So whether someone makes $ 30,000 instead of $ 15,000 makes as big a difference to happiness as if someone makes $ 300,000 instead of $ 150,000. This effect also remained statistically significant when the author excluded other possible influencing factors such as age, gender, educational level and relationship status.
More luck or less bad luck?
But where does the increased well-being come from? Is it mainly related to the fact that people feel less uncomfortable with increasing wealth, or to the fact that they feel more and more comfortable? Or both? To answer this question, Killingsworth evaluated which feelings the test subjects indicated in the smartphone surveys. Overall, it was shown that negative feelings such as fear, stress, boredom and sadness decrease and positive feelings such as confidence, interest, inspiration and pride increase with increasing income.
“There was some evidence that higher income for low-wage earners primarily reduced negative feelings, while higher income for higher-income earners disproportionately increased positive feelings,” says Killingsworth. While the previously assumed limit of US $ 75,000 for the overall level of happiness did not play a role, it made the difference here whether increasing happiness resulted from less negative or more positive feelings.
Control and Security
But which factors ensure that money and happiness are related? “The answer to that question is necessarily speculative,” says Killingsworth. After all, the factors are presumably so diverse, complex and interlinked that hardly any individual can be identified as particularly decisive. “One possibility is for people to spend money to reduce suffering and increase happiness, and marginal amounts may be used differently for these goals depending on income,” he says. This is supported by the result that among low-wage earners, a higher income was primarily associated with fewer negative feelings, while with higher earners, positive feelings increased more.
“Another possibility, which is not incompatible with the first, is that higher incomes give people more control over their lives,” speculates the researcher. The feeling of financial security probably also plays a role. How important money was to the test subjects did not differ between people with high and low incomes. However, among the low-wage earners, those who said money was not particularly important to them were happier. It was the other way around for the higher earners. “Overall, it turns out that the previously assumed limit of 75,000 US dollars does not apply,” summarizes Killingsworth. “There may be a limit, but if it is, it is significantly higher than previously thought.”
Source: Matthew Killingsworth (University of Pennsylvania), Proceedings of the National Academy of Sciences, doi: 10.1073 / pnas.2016976118