Have any of you seen this Huffington Post article? It shows the income happiness benchmark by state. In other words, how much money do you need to make annually before it won’t make you any happier? Johnny and I were pretty fascinated by the results.
The average income happiness benchmark throughout the US is around $75k. Take our current home state, Utah, for example. The income-happiness threshold is $69,750. If one spouse were making $40k/year and the other were making $30k, they’d already be above that number. But what are the chances that they’d feel like they had enough? I mean, does anyone ever feel like they have enough?
Johnny and I are doing much, much better than the combined $10k we were making our first year of marriage as college students. But we’re always working to make more. And I don’t think it’s for selfish reasons.
In the here and now, we have enough. And our day-to-day happiness probably wouldn’t change if we were making more money. But we’re not just living for the day-to-day. We’re trying to save for a second car, a home, future children, our children’s college, and retirement. And I don’t feel like those are particularly selfish things to want. Could we save enough money for all of those things if we made $69k for the rest of our lives? I don’t know… but it would definitely feel tight.
Maybe our daily happiness wouldn’t change if we were making more than $69k living in Utah, but our future happiness could be affected if we could or couldn’t save up for the things I just mentioned.
Do these numbers surprise you? I think it’s kind of awesome how clearly this graph enforces that money doesn’t buy happiness. But, once again, what if I’m not looking for it to buy happiness? What if I just want it to buy me a house, financial security, and a stress-free retirement?
What do you think? Agree? Disagree? We’re interested to hear your thoughts!
I guess it all boils down to one’s definition of income happiness, Joanna. Does it mean enough $$$ to meet all of one’s needs (be it for a single person or a household)? Does it mean enough $$$ to not only meets needs but also one’s wants? Does it mean having enough to share with others (with charities for example)? Or maybe having enough $$$ that is passively earned (thru investments or inheritance, for example) such that one is financially self sufficient and need not have to go out to work, if desired? I consider It really a subjective thing, regardless whereever you happen to live – be it in a homeless shelter or in a McMansion.
True. It’s all about the perspective and expectations we have for our money. Our expectations are definitely different from others’.
Living in the Boston area, I am not at all surprised by Massachusetts having one of the highest income thresholds. I am constantly amazed at how expensive property is around here. And, I will say, that when I started a job that allowed me to make a commission, I definitely noticed a lower stress level overall. But, it’s a slippery slope because I am definitely of the opinion that I don’t want to HAVE to make a good amount of money to be happy, I just want it to happen to pump of my happiness a little bit. Does that make sense?
Haha, we’re the same way, Anna. It makes perfect sense. I don’t think our income has ever made us more or less happy. But there is a certain peace that comes from knowing we’re on the right financial track.
I am part of two moms groups. In the first group, I am probably the poorest member. All of the other moms are the wives of investment bankers or surgeons or something. In the second group, I am one of the wealthiest members. All of the other moms are on WIC and Medicaid.
Here is the thing- all of the moms in both groups are stressed out about money. They are all worried about paying for childcare, affording having more children, saving for education, and saving for retirement. So even though the first group moms are well beyond the happiness threshold in our state, they are not actually happier than the second group of moms. Everyone feels like things are tight. It is easy for me to think, well heck, if I had YOUR money, things would be so easy! But you know what they say- more money, more problems.
Now I would say that the first group has a higher “life evaluation” which, as the article says, continues to rise with income. I think it is easy for them to feel that they have made the “right” choices in their lives. But they don’t seem HAPPIER than the second group, or even less stressed out about money.
Very interesting perspective, Tarynkay. Avoiding lifestyle inflation is a big factor in how more money makes people feel. Johnny and I are trying to make more money without changing our lifestyle, therefore giving ourselves more financial peace and less financial stress. Either way, though, we were just as happy making $10k/year in college as we are now.
I had seen a similar article on the study a while back and I also interpreted it to consider the amount of stress you have from work. Say, if you have a job that earns significantly higher than the benchmark salary, the level of stress/time at work would outweigh the additional wealth you now have. The dollar amounts seem pretty accurate, I’ve thought for a while now that if my fiance and I each made 100k/year, we’d be able to buy a house and live pretty comfortably (in CA).
However, It is true that no matter how much money you make, your lifestyle adjusts and you still want more.
Good point, Alicia. No amount of money is worth spending the majority of your life at a job that makes you stressed and unhappy.
my husband and I make more than double now what we made our first year of marriage. We are VERY happy. We had way too much to worry about back then and not having enough money caused unnecessary stress. These days, we’re living the DINK lifestyle 🙂
Haha, I love this comment. It’s nice hearing someone admit that having more money has had a positive effect on their happiness.
I’ll be honest. We’re below the income level for our state for the happiness level. Are we happy? Yes, but I know that if are income was higher, we would in fact be happier. It would allow bit of breathing room and things wouldn’t feel so tight. We wouldn’t stress as much about financial issues and that plays into a family’s happiness level
One thing that helps is knowing that for us this temporary. With a husband in college, our income isn’t as high as it could be since he works part-time. Once he graduates in a mere 7 ½ months, we know that our income level should go up (ok, ok, not immediately, but once he’s settled and has a new full-time job).
In the meantime, we live with less and look to the future. And our budget has helped tremendously with that. If there’s ever a month where we don’t budget, we tend to overspend and our stress level is higher. The budget puts every tiny penny towards something and we don’t have to stress about where it goes. It also allows to see if we truly have the money to spend frivolously. It has been our life saver.
Love your perspective, Sabrina. While our overall happiness has always been pretty much the same, times of financial stress have definitely caused stressful, less-than-happy moments.
I really liked what you had to say about budgeting… very wise words, girl! Pretty sweet that your husband is going to be done with school and back in the workforce so soon… that’s gotta be a pretty great feeling for both of you!
I’m just above the happiness threshold for DC and am pretty broke after paying for my student loans, retirement, $2000 rent and such. I’m moving to Texas in a month and will have a similar income and be way above the level listed here. Honesty, I will be a hell of a lot happier. I’ll have money to pay off my bills, save for a house and the future. I don’t buy the figures. Everything is relative.
Agreed, Meghan. Seeing our money being able to do more once we left the big city was a major boon to our quality of life. I swear this study didn’t take into account everything you mentioned. It sounds like Texas is going to be an awesome change… good luck with the move!