When people are asked if money can buy you happiness, you would think the majority of people would say that yes. People with higher incomes are going to be happier than the ones who struggle to get by. But, dig a little deeper and you will find that this is not exactly true.

Recent research proves that wealth alone does not determine happiness; what matters more than a large income is how you choose to spend it. During a study at Zurich University, participants were given a choice to spend a certain amount of money given to them on themselves or on others. Half of the participants chose to spend it on themselves, while the other half chose to use that extra money to give a gift to someone else. These participants underwent an MRI scan, the scan showed that the one who chose to spend their money on other people were significantly happier than the ones who chose to spend the money on themselves.   

Numerous studies have shown us that life experiences give us much more happiness than material things. A professor of psychology at San Francisco State University conducted a study on what people thought about buying material items opposed to vacations, concert tickets or gifts for others. “What we find is that there’s this huge misforecast,” he says. “People think that experiences are only going to provide temporary happiness, but they actually provide both more happiness and more lasting value.”

We all assume that self-interest is going to be stronger than wanting to be generous towards other people. But, as studies have shown, people are much more happy when they give to others opposed to focusing their money on themselves. A survey from 136 countries show that spending on others has a “consistent, causal impact on happiness”.