Finding a Life Manual

To be happier, give your money away, spend it on others, or spend it on experiences with others...

One of the most consistent findings of the happiness literature is that having a strong social network is an excellent predictor of happiness
they surveyed 632 Americans on their general happiness, along with what they spent their money on, and found that higher “prosocial spending” - gifts for others and donations to charity - was indeed correlated with higher self-reported happiness.
But was the happiness caused by giving money away, or were charitable people simply happier to start with? To show a causative link, they then performed an experiment in which volunteer test subjects were given a small windfall of $5 to $20. Some of the subjects, chosen at random, were told to spend it on a bill, an expense, or a gift for themselves. The others were told to buy a gift for someone else or make a charitable donation. Afterwards, the second group - the ones who had given the money away - reported being significantly happier than those who had spent the money on their own needs.
“By that I do not mean give all your money away and live in a shack,” she says. “I just mean think about increasing it slightly. Just reallocating as little as $5 on a given day can make a difference in happiness.”

Spending on experiences also makes people happier because experiences are usually more social - involve others, etc.

In addition, other work by Van Boven suggests that experiences don’t usually trigger the same sort of pernicious comparisons that material possessions do. We like our car less whenever we catch a glimpse of our neighbor’s newer, nicer car, but we don’t like our honeymoon any less because our neighbor went on a fancier one.

And while we quickly grow accustomed to a new suit or a bigger house, no matter how much we originally loved it, experiences instead tend to get burnished in our memory - a year after a vacation, we look back not on the stress of dealing with lost luggage or the fights over which way the hotel was, but the beauty of the scenery or the exotic flavors of the food.

As an aside, that first line also resonated with me on the importance of creating a strong social network and how that’s correlated with happiness