Does Money Actually Make You Happy?

It’s the age old debate – does money actually make you happy? While money alone might not buy happiness, it certainly plays a significant role in shaping our lives. From reducing stress by providing security and stability to enabling you to pursue your passions and dreams, your financial health profoundly impacts your overall sense of fulfilment and contentment.

However, achieving financial success is not just about accumulating money; it’s about managing your resources wisely to live the life you desire. In our latest podcast episode, we sat down with financial expert, Kate Campbell, as she shared smart strategies for leveraging your time and finances to enhance your well-being and happiness. 

Listen to the full episode to learn how minor adjustments can significantly impact your daily satisfaction and overall quality of life, offering practical advice for making the most of what you have.

There definitely is an intersection of money and happiness, so here are some basic strategies to help you add purpose to your finances.

How to be Happier Now By Setting Financial Goals

Setting clear, achievable goals provides the roadmap for your finances, guiding your actions and decisions along the way. Whether it’s saving for retirement, buying a home, or starting a business, knowing what you are working toward gives you direction and motivation.

But setting goals isn’t just about identifying your dream life, it’s about breaking it down into smaller, manageable milestones. By breaking your larger goals into bite-sized tasks, you can make progress more tangible and attainable, boosting your confidence and momentum.

Understanding the “why” behind your goals is just as crucial as defining the “what.” Knowing why you want to achieve certain money milestones provides the fuel to keep you going when big challenges arise or hiccups happen along the way. 

Whether it’s to provide for your loved ones, pursue your passions, or leave a legacy, your underlying motivations give purpose to your financial goals, giving you more joy while working towards them and when you do achieve them. When your money aligns with your values you are happier.

Make Small Changes to Save Money

When saving money, it’s easy to forget the power of small, consistent changes.It’s the cumulative effect of small, everyday decisions that ultimately shapes your financial future.

While setting aside a large sum of money may seem overwhelming and stressful, committing to saving a small amount regularly can give you a healthy account balance over a year. Whether it’s putting aside a portion of each pay cheque or cutting back on unnecessary expenses, these tiny changes can add up to substantial savings over the long term. 

Small changes extend beyond saving to other areas of your money, such as budgeting, investing, and debt repayment, allowing you to have more money to spend on what makes you happy. This might be travel and holidays or a big ticket purchase like your dream car

Small changes not only have a real impact on your finances but also contribute to your overall sense of empowerment and control, leaving you happier.

Can Money Buy Happiness?

While money alone may not buy you happiness, how you choose to spend your money can profoundly influence your well-being.

You should spend money in ways that align with your personal values and priorities. Research shows that experiences, relationships, and personal fulfilment contribute more to your overall happiness than material possessions.

Investing in experiences—such as travel, hobbies, or learning opportunities—can create lasting memories and enrich your life in ways that material goods cannot. 

Spending money on activities that bring us joy and fulfilment can enhance our overall well-being. Whether it’s pursuing a passion, engaging in creative projects, or contributing to causes we care about, these are investments in our personal growth and happiness.

Don’t forget, nurturing meaningful relationships and fostering connections with others can provide a sense of belonging and fulfilment that money alone cannot give you.

Often Happiness is Buying Your First Home

When it comes to buying your first home, it’s important to consider both the financial and emotional aspects of the decision. While having the money to buy a home is crucial, it’s equally important to evaluate how the purchase aligns with your personal values and priorities. Will buying a home really make you happy?

Consider the emotional factors involved in buying your first home, such as the neighbourhood’s vibe,the proximity to amenities like the gym you go to or where you work, and whether the property actually feels like a place you can call home.

Research shows that the biggest feeling people have about owning their own property is having pride in the home and being able to invite people over, knowing that the home was theirs and how hard they worked to get it. 

Avoid the trap of prioritising financial gain over your emotional well-being. Buying a house based solely on its investment potential can lead you to feelings of dissatisfaction if it doesn’t meet your personal needs and preferences. The “worst house on the best street” strategy may not always result in happiness if it leads to constant comparison with neighbours or feelings of inadequacy. Rushing into decisions based solely on price or external pressure can lead to buyer’s remorse.

Buying your first home will make you happy if:

  • You define your non-negotiables and prioritise features that align with your lifestyle and long-term goals.
  • You take the time to explore different neighbourhoods and properties to find the right fit for your needs and preferences.
  • Consider working with a buyer’s agent who understands your priorities and can help you through the buying process with confidence and less stress.

By approaching the property purchase process with a holistic perspective that balances financial considerations with your emotional needs and values, you can buy a house that enhances your happiness. 

Remember that finding the perfect property is not just about the numbers; it’s about finding a place where you can truly feel at home.

Yes, Money Does Actually Make You Happy

By expanding your knowledge base, you can empower yourself to make better financial choices increasing your overall happiness. 

One valuable resource for continual learning is free financial education courses offered by reputable institutions like RASK Education. These courses cover a wide range of topics, from basic budgeting and saving strategies to advanced investment principles and can give you the tools to manage your finances and personal happiness more effectively. 

You can also check out Kate Campbell’s book, Buying Happiness, that will teach you that by taking control of your finances and thinking a little more deeply about the way you use your resources, you can improve your life.

You can also seek free guidance from our brokers who can provide valuable perspectives and help you stay on track toward your financial goals.

By staying informed and adaptable, you can handle financial challenges effectively and make educated decisions that protect your money and happiness.