We've all been taught that money cannot buy happiness. There are even studies that back this up.
One of them found that, although most people believe that if their income doubled, their happiness would also double, people who went from earning $25,000 a year to $55,000 per year reported only a 9 percent increase in happiness. Additionally, one of the most widely quoted studies on the subject tells us that once you make a solid middle-class salary--about $75,000 in America--earning more money doesn't make any measurable difference in a person's level of happiness.
So, you might ask, what's the point?
The truth is: More recent studies have proven that money can make us happier. Scientists have shown that "spending as little as $5 a day can significantly change your happiness." How so? Well, it's not the amount of money you spend, but something else that matters. "Every day spending choices unleash a cascade of biological and emotional effects that are detectable right down to saliva," report Harvard's Elizabeth Dunn and Michael Norton in their brilliant book Happy Money: The Science of Smarter Spending. "While having more money can provide all kinds of wonderful things--from tastier food to safer neighborhoods--its real power comes not in the amount, but how we spend it."
They have scientifically proven that there are many different ways you can spend your money that will actually increase your happiness significantly. I won't reveal them all here and will leave it to you to pick up their book, but three of the most important are:
INVESTING IN EXPERIENCES
This includes travel, learning a new skill, or taking some courses, rather than acquiring more possessions.
BUYING TIME FOR YOURSELF
"Whenever we can outsource our most dreaded tasks (from scrubbing toilets to cleaning gutters), money can transform the way we spend our free time, freeing us to pursue our passions!" But can you guess the greatest thing you can do with your money that will bring you massively increased happiness?
INVESTING IN OTHERS
That's right. Giving our money away actually makes us really happy!
Research shows that the more you give to others, the happier you are. And the more you have, the more you are able to give. It's a virtuous cycle. Dunn and Norton demonstrate through their own scientific studies that people get more satisfaction out of spending money on others than they do spending it on themselves. And the benefits "extend to not only subjective well-being...