Why does money make you unhappy

Or as the economists behind this recent analysis concluded: "In the United States, the [psychological] well-being of successive birth-cohorts has gradually fallen through time. Needless to say, this data contradicts one of the central assumptions of modern society, which is that more money equals more pleasure.

We've been led to believe that dollars are delight in a fungible form. But the statistical disconnect between money and happiness raises a fascinating question: Why doesn't money make us happy?

One intriguing answer comes from a new study by psychologists at the University of Liege, published in Psychological Science. The scientists explore the " experience-stretching hypothesis ," an idea first proposed by Daniel Gilbert. He explains "experience-stretching" with the following anecdote:.

I've played the guitar for years, and I get very little pleasure from executing an endless repetition of three-chord blues. But when I first learned to play as a teenager, I would sit upstairs in my bedroom happily strumming those three chords until my parents banged on the ceiling Doesn't it seem reasonable to invoke the experience-stretching hypothesis and say that an experience that once brought me pleasure no longer does? The good news is that building up just a small reserve of cash can make a difference, and this is true for people who are still trying to escape debt as well.

Still, the idea of saving cash, even a small amount, can be intimidating. You may have anxieties about cutting back on expenses, creating a budgeting plan, or making sacrifices. Begin by answering these two questions:.

If the answer to the second question is no, try taking a break from those expenses, even just for a few weeks. But if the expense does make you happy, go ahead and enjoy it, without beating yourself up. Spend on experiences, not things.

Sixty-two percent of respondents were Gen Z or Millennials. One of us Elizabeth was perfectly content with her iPhone 8, until she received a text message offering her a shiny new iPhone No money down! She caught herself increasingly leaving the rapidly aging iPhone 8 on the edge of tables, nightstands, and sinks, unconsciously waiting for its demise. This behavior is not uncommon. Research shows that when a desirable upgrade becomes available, people often become careless with their existing products.

The fact that material things are so easy to compare helps explain why they are often unsatisfying. After all, even the iPhone 11 might not look so great next to the iPhone 11 Max Pro. Buy time. The only way to feel good about yourself and your financial situation is to stop comparing yourself to other people. The key to financial happiness is to focus on your goals and not worry about how much money other people have.

The sad truth is most people want to feel superior to the people around them. Very few people would publicly admit to having money problems. Most people do the exact opposite. They use social media, particularly Instagram and Facebook, to make themselves look wealthier and more successful than they are. Social media has made it easier than ever for us to compare our situation to other people and, in the process, make ourselves feel worse about our finances.

If you want to have a more positive outlook on money you need to do two things. Figure out what makes you happy and align your finances accordingly. I recently wrote about three questions to ask yourself before you spend money. Did I receive fulfillment, satisfaction, and value in proportion to the energy spent? Is this expenditure of life energy in alignment with my values and life purpose? A man is a success if he gets up in the morning and goes to bed at night and in between does what he wants to do.

Even the ancient philosophers were frequently critical of wealth and money. On the other hand, there have always been poets and philosophers who viewed the matter in quite a different light. So what is it that causes unhappiness—money or rather the lack of it? Money is a major bone of contention in virtually every divorce and researchers have found that it is also at the core of many arguments in relationships.

Lauren Papp from the University of Wisconsin asked couples with children to keep a diary for two weeks. Partners were asked to separately record the cause and duration of their arguments each day. The results showed that couples argued more intensely about money than any other subject. Most couples felt that arguments about money constituted a threat to their shared future and found them harder to resolve than any other arguments.

Erich Kirchler, a business psychologist at the University of Vienna, wanted to know what couples talk about and what they argue about. He asked 40 couples to keep a diary for a year. Economic issues proved to be more controversial than any other topics.