Can money buy happiness?

As much as you may be loathe to admit it, your dreary 9-to-5 job could be giving you more happiness than you realize. Research indicates that one of the reasons people with greater salaries often seem happier than their peers is actually an outcome of their success rather than the dough they're raking in. In general, people who make more money also tend to be more successful at what they do: It's this success that makes them feel good, not the money itself. The money is a mere sideshow of the real happiness booster [source: Brooks].

Successful people are also usually more productive and satisfied with their jobs, thus creating positive feelings of self worth, pride and contentment. The extra money the hard work creates is simply an added benefit -- the good feelings would be there regardless of the payoff. People with jobs they find highly satisfying but that don't pay as well can be just as content, and the cattle-herding Masai mentioned on the first page bear this out.

Another reason success stimulates feelings of happiness is because of the challenges involved. People get a charge out of pushing their mental and physical capacities to the limit, and when they pursue something that fully captures their interest and attention, time passes by imperceptibly. Not only is the hard-earned outcome rewarding, but so is the sweat put into making it happen. Scientists have nicknamed this phenomenon flow and they give it credit for a number of positive emotions. Results of one study indicate workers would happily take a 20 percent pay cut if it meant their job would involve more variety or require more skill [source: Futrelle].

But don't turn down your next salary raise just yet. If you play your cards right, you might be able to squeeze a few extra bits of joy out of that work bonus.

Since you can't spend your lottery winnings or Christmas bonus on happiness, you may need a few pointers on what you should spend it on. If it's happiness you're after, you might do best to simply give it away.

In an experiment that would make Mother Theresa proud, a group of researchers gave students $5 or $20 to spend. Half of the students were told to spend the money on something for themselves and the other half to spend it on someone else. Despite the students' belief that they'd be happier if they were assigned to the "spend it on yourself group," when polled afterwards the students who used the money to help someone else actually reported higher levels of happiness, regardless of how much money they were given in the first place [source: Goldberg].

In a similar study involving work bonuses, employees were able to increase their happiness level by an entire point on a 5-point scale when they spent one-third of their bonuses on others. This was true regardless of whether that bonus was $3,000 or $8,000, indicating that when it comes to happiness, it's not the amount of money you earn but how you spend it that really matters [source: Bryner].

While the exact reason for this selfless spending euphoria isn't certain, it's possible that it generates feelings of gratitude, makes a person feel better about themselves or simply involves more social interaction, all of which are linked to happiness.

On a similar note, people also tend to report higher levels of satisfaction after spending money on experiences rather than things. For instance, purchasing tickets to a movie with a group of friends is likely to make you feel better than impulsively buying a T-shirt at the mall. While the positive feelings associated with the movie outing can be relived again and again, the T-shirt's novelty will probably wear off after a couple of spins in the wash.

Basically what all of this data about money and happiness tells us is that it's called cold hard cash for a reason. You can buy all of the flashy cars, Armani suits and diamond rings you want, but at the end of the day, you're going to be the same person -- just with more stuff. Without the things that research tells us are the real sources of happiness -- social connections, challenging work, good health -- you're not going to get very far in your new set of wheels.