Stuff Doesn't Make You Happy . . .

Sunday, December 25, 2005 | 08:00 AM

While everyone is busy unwrapping all of their holiday gifts, here's something to mull over: Stuff doesn't make you happy.

There has been an ongong thread about this amongst some of the econoblogs, and I think some of the commenters may be missing the main point: The value of wealth isn't necessarily the THINGS you can acquire, it is the things you can do with it -- the experiences and memories that you can "acquire."

Think of it this way: Its the not the TOYS, its the PLAYING.

Now, let's be honest -- I am in no position to lecture anyone about the evils of materialism; Does anyone really need a 500 HP car? How many watches can one person wear? The silk neckties in my closest cost more than the GDP of a small country -- please do not take this as a holier than thou finger wagging. I am as guilty as anyone else

No, this is merely a moment of reflection during the holidays of what truly matters, and what actually makes people happy.

In my experience, most of us would get more out of taking an advanced driving course at Skip Barber, where you learn HOW TO DRIVE high performance cars, and wring the most performance out of them -- than merely having one. If you still want the F-car, then go get -- but drive the shit out of it, join a car club, go on roadtrips -- but don't just leave it in the garage.

Basic psychology suggests we do not have an innate need to accumulate "stuff;" indeed, we were nomadic throughout all but the last 10,000 years or so. How you spend your time -- your relationships are a big key to this -- will determine how "happy" your life is.

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These are just one man's opinion and experiences . . . However you spend them, do have a Happy Holiday!

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Click for larger graphic

20051005_nythappycharts

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UPDATE December 31, 2005  9:56am

Today's NYT has an article ont hat exact same theme:

"As some of you may have heard, money does not have a very strong relationship to happiness. Indeed, it is unclear whether the two parties are even well acquainted. Yet, according to the renowned British economist Richard Layard, author of "Happiness: Lessons From a New Science" (Penguin, 2005), humans cling to the notion that the two are linked - with a result, Mr. Layard said in an interview, that "people tend to expect more from money than it can give."

That's not to say being broke is better. One of my favorite quotations in Mr. Layard's book is credited to Woody Allen: "Money is better than poverty, if only for financial reasons." Amen to that. At the same time, Mr. Layard points out that the research on this topic suggests that we would all be a lot happier if we understood the true effect of money on our psyches.

You or I may wish for a more prosperous new year, a big raise, a fat bonus, the wherewithal to buy a bigger home, a nicer car and so forth, but Mr. Layard says that "many studies show that people have an exaggerated forecast of the benefits of having that higher income or bigger house."

As soon as your material position improves, researchers have found, there is a remarkable tendency to adapt. The thrill is gone, as they say. "When we monitor how people are affected by the house or car, it's not anything like they expected," Mr. Layard said. "Your happiness does go up for a while, then it returns to the base level.

If you think that sounds like a recipe for that chronic not-quite-satisfied feeling, you would be right. People tend to crave more money and more things to restore that peak of good feeling - only to adapt to those pleasures and seek the next high - an addictive phenomenon that economists have called the hedonic treadmill."

Fascinating stuff . . .

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Sources:

Latest from the happiness industry                     
http://neweconomist.blogs.com/new_economist/2005/10/latest_from_the.html

Keeping Up With the Experiential Joneses
http://economistsview.typepad.com/economistsview/2005/11/keeping_up_with.html

A New Measure of Well-Being From a Happy Little Kingdom
By ANDREW C. REVKIN (NYT) 2936 words
Published: October 4, 2005
http://tinyurl.com/7oe4z

Recalculating What Money Can't Buy
M.P. DUNLEAVEY, Basic Instincts
NYT, December 31, 2005
http://www.nytimes.com/2005/12/31/business/31instincts.html

Sunday, December 25, 2005 | 08:00 AM | Permalink | Comments (22) | TrackBack (4)
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» The Lives We Live from Zmetro.com
Changing planes at O'hare recently, I stood next to an early 20's woman trying to fly standby to Dayton, Ohio. I discovered that she structured work to support her travel wants. My fellow traveller said that she joined the Air... [Read More]

Tracked on Dec 25, 2005 10:25:01 AM

» Stuff - It Won't Make You Happy from BusinessPundit
Barry Ritholtz has a great post about why all that stuff you got for Christmas might be nice, but it won't make you happy. It's interesting because it ties back in to the first post I ever made.... [Read More]

Tracked on Dec 27, 2005 6:28:28 PM

» Stuff - It Won't Make You Happy from BusinessPundit
Barry Ritholtz has a nice post about why all that stuff you got for Christmas might be nice, but it won't make you happy. It's interesting because it ties back in to the first post I ever made.... [Read More]

Tracked on Dec 27, 2005 6:30:47 PM

» Welvaart en geluk from Govert.info
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Comments

Money may not buy happiness but it is a hell of alot more pleasant living in a castle than living in a dirt hut. Those studies are BS. The human condition never changes regardless of our social standing. We still have mental illness, we still get sick, we still lust after what we don't have, we still complain about what isn't right, we still compartmentalize so that we can feed our face at Xmas while tens of millions in the world don't have anything to eat, etc. (But we feel better giving to our local charity.)

But, all things equal, I'd prefer to do it with alot of money than wondering if I am going to die in the middle of the night from hunger.

Btw, I know that poll is flawed because The Nederlands isn't at the very top. Anyone who gets to legally smoke Ganja and eat shrooms has to be happier than that.

Posted by: B | Dec 25, 2005 8:35:08 AM

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