Pattie Lovett-Reid: Money can buy happiness — if you spend it the right way
Money really can buy you happiness when spending fits your personality. This is according to research conducted by Yale University and the University of Cambridge, based on nearly 77,000 actual U.K. banking transactions.
“Historically, studies have found a weak relationship between money and overall wellbeing,” according to one of the authors, Joe Gladstone. But, the study breaks new ground by mining actual bank-transactions data and demonstrating that spending can increase our happiness when it is spent on goods and services that fit our personalities and meet our psychological needs.
The study matched spending categories on the “Big Five” personality traits – openness to experience (artistic versus traditional), conscientiousness (self-controlled versus easygoing), extraversion (outgoing vs reserved), agreeableness (compassionate vs competitive) and neuroticism prone to stress versus stable). It really comes down to knowing yourself and resisting the urge to conform to pressure from others trying to get you to spending money on something that really won’t fulfill you. Pause before you purchase to consider you personality before you buy. Weigh your options and be clear on your intentions.
If money doesn’t make you happy, then you probably aren’t spending it right. Recently, there has been more discussion around focusing on experiences, giving back and even delaying consumption. This however, isn’t only about the individual, the findings have wide reaching implications for business. Knowing what products and services to push your way won’t only improve the clicks for an online retailer, it will improve the relationship and overall spend.
The researchers backed up their experiment by giving people a voucher to spend in either a bookstore or bar. Extroverts who were asked to spend the voucher in a bar were much happier than introverts forced to spend in a bar, while introverts forced to spend in a bookstore were much happier doing that than the extroverts.
Moral of the story: matching your personality with spending can cause an increase in happiness. Give it a try.