Study: Money Does Not Buy Much Happiness

Your next raise might buy you a more lavish vacation, a better car, or a few extra bedrooms, but it's not likely to buy you much happiness.

Measuring the quality of people's daily lives via surveys, the results of a study published in the June 30 issue of journal Science reveals that income plays a rather insignificant role in day-to-day happiness.

Although most people imagine that if they had more money they could do more fun things and perhaps be happier, the reality seems to be that those with higher incomes tend to be tenser, and spend less time on simple leisurely activities.

Scaling bad mood 

In 2004, the researchers developed a survey tool that measures people's quality of daily lives. Then they asked 909 employed women to record the previous day's activities and their feelings toward them.

The study focused on women because the researchers wanted to study a homogeneous group while the surveys were in the early developmental stages.

Recently, the researchers revisited the data from the 2004 and focused on correlating the amount of income with the percentage of time each participant reported as being in a bad mood each day.

It was expected that those who made less than $20,000 a year would spend 32 percent more of their time in a bad mood than those that had an annual income greater than $100,000.

In reality, the low-income group spent only 12 percent more time in a bad mood than their wealthier counterparts. This suggests that the link between income and mood has been perhaps overstated.

The researchers once again surveyed another group of women in 2005. In this study, participants not only recorded their overall satisfaction with life but a moment-to-moment account of their contentment.

The results showed that higher income had less of a correlation with momentary happiness than with overall life satisfaction.

"If people have high income, they think they should be satisfied and reflect that in their answers," said study team member Alan Krueger, an economist from Princeton University. "Income, however, matters very little for moment-to-moment experience."

More chores, less fun 

Krueger and colleagues also looked at data from a Bureau of Labor Statistics survey to see how people in different income brackets spent their time.

What they found was that those with higher incomes had more chores and less fun.

They devoted more time to working, commuting, childcare, and shopping and were under more stress and tension than those in lower income brackets.

According to government statistics, men who make more than $100,000 a year spend 19.9 percent of their time on passive leisure activities such as watching television and socializing. Meanwhile, men whose annual income were less than $20,000 spent more than 34 percent of their time dedicated to passive leisure.

Although the correlation between income and life satisfaction is weak, people are highly motivated to increase their income. This illusion may lead to more time spent on activities like commuting while sacrificing time spent on socializing, something that people consider amongst the best moments of their daily life, the researchers said in the study.

The scientists are now conducting a national survey with both male and female sample groups.