Spending: Can money really buy happiness?

It’s not how much you have, but how you spend it, said Gareth Cook in Scientific American. There’s a commonly held notion that having more money “is going to make us happier,” but more often than not, that is an erroneous notion. We’re better off if we “stop thinking exclusively about how to get more money and instead focus” on getting the most happiness for the buck. Researchers suggest spending less money on “stuff” and more on “experiences”—such as vacations or meals.

You may even want to reconsider homeownership, said Michelle Higgins in The New York Times. Even though it’s a key component of the American dream, “spending money on real estate doesn’t necessarily mean investing in contentment.” For years people have been encouraged to cut back on day-to-day spending to save for a down payment on their own home. But more and more research shows that those years of penny-pinching do not improve our emotional well-being. That insight “may offer some solace to frustrated buyers” in today’s real estate market, where mortgage rates are low but pickings are slim. And it’s good news for those living in places like New York City, where rentals make up the majority of housing stock. Research has shown that homeowners aren’t generally any happier than renters are.

Your bank balance isn’t the important thing, said Sebastian Bailey in Forbes.com. Independence and autonomy have “a larger and more consistent effect on well-being than wealth” does,researchers have found, and there are other ways than money to secure them. Employers should take note that giving workers more autonomy “is a great way to build engagement and get better performance.” This can include being flexible about work hours or telecommuting, and learning to delegate. Bosses would do well to lay off the micromanagement, solicit feedback from employees, and “stop monitoring their every move.”

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Happiness requires an investment—in others, said Elizabeth Dunn and Michael Norton in Harvard Business Review. As we lay out in our new book, Happy Money: The Science of Smarter Spending, spending just a few dollars on others—“from giving to charity to buying gifts for friends and family”—can boost your happiness. There’s a message there for managers, too. Bonuses for employees “can have a large emotional payoff,” and customers spend more when you donate some of the price of your product to charity. It makes good business sense to “maximize the happiness that employees and customers get from every dollar.”