Some amount of money could just buy you and your family happiness, claims a new study published in Nature Human Behavior led by Andrew T. Jebb, a doctoral student in the Department of Psychological Sciences at Purdue University. “We found that the ideal income point is $95,000 for life evaluation and $60,000 to $75,000 for emotional well-being” for an individual, Jebb tells the global science news website EurekAlert, and more for a family.
For people in North America specifically, the magic “life evaluation” number is $105,000, just about what Warren Buffett, one of the world’s richest people, says he could be happy with. That would reflect your overall assessment of how satisfied you are with your circumstances.
For families in North America, you have to do a little math to figure out the magic “life evaluation” number. “To obtain estimates for households with more people, one can simply multiply the satiation estimate by the square root of the house-hold size,” the report notes. So the ideal income for an American family of four, for instance, would be $210,000.
Earn any higher than this threshold, though, and the researchers found you might actually experience lower overall satisfaction. Jebb asserts that higher income is often associated with larger workloads and less free time. You can also get more competitive once your basic needs are met, and it can hurt to focus too much on material gain and social status.
The researchers also figured out the income associated with the somewhat more modest standard of “emotional well-being” by making a focused assessment of people’s day-to-day feelings. They found that making between $65,000 and $95,000 per individual in North America could help keep you happy.
In a prominent study published back in 2010, economists from Princeton University polled 450,000 Americans and found, similarly, that happiness does increase with wealth, but the correlation peaks at earning $75,000 per year.
Jebb’s team’s findings are based on a Gallup World Poll of more than 1.7 million individuals from 164 countries. Unsurprisingly, results from different regions varied considerably. The general trend was that, in wealthier places, people tended to say they needed more money to be happy.
“These findings speak to a broader issue of money and happiness across cultures,” Jebb said. “Money is only a part of what really makes us happy, and we’re learning more about the limits of money.”
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