Once basic needs are met, including the ability to pay bills and provide sufficient shelter and food, making more money will not necessarily make you happier. Happiness tapers or levels off after $75,000 because most of us don't know how to buy happiness.So how does the mind experience happiness? Studies show that people adapt more slowly to experiences than to material purchases. As opposed to material possessions, experiences exist only as mental representations. Unless you bought a rug during the life-changing trip to India, the experience exists only in your mind now. Experiences like going on a holiday, taking a day trip, going to the cinema, theater or museum require changes to a daily routine. The more changes that are made, the longer it will take to adapt to these changes. During this process, the mind forms memories. Overtime, these memories grow and can be revisited. Experiences are always open to positive reinterpretation and slowly have a tendency to become central to identity. A person's life is quite literally the sum of his or her experiences. Simply, the more happy memories you have, the happier you are.
Now apply what you’ve learned with these five Freud-approved tips to buying happiness.
1. Buy experiences and not things.
Before purchasing an expensive apartment, car, or pair of shoes, try coming to a deeper understanding about what you are actually buying. On the emotional level, purchasing material goods often has a negative impact on happiness. Apartments, cars or shoes do result in comfort but not long-term pleasure. Purchasing comfort is a great way to eliminate the pains of life, but comfort is something we get used and it must be purchased over and over to replicate the feeling. However, buying experiences like visiting a new country or city will allow you to form new memories. Planning your experience carefully to maximize the number of new and exciting things that you see or experience will help you form more memories. Overtime, your mind will reinterpret, revisit, and embellish these memories, setting a foundation for long lasting satisfaction.
2. Spend money on friends and with friends.
Research suggests that socializing with friends and family can be the happiest times of your life. Spending money on activities with friends, families, and acquaintances represents a more effective route to happiness than spending money on personal things alone. For example, a study that looked at the happiness of people employed on Wall Street roughly six to eight weeks after they received a yearly bonus found that the manner in which they spent that bonus was a greater predictor of happiness than the size of the bonus itself. Those people who spent more of their bonus on experiences and social activities felt greater happiness than did those who bought something for themselves.Take your friends out to dinner, a concert, or take a trip together and make more happy memories.
3. Focus on the process.
For lasting happiness, it is important that you enjoy the process of spending and get satisfaction from your purchase. Again, purchasing experiences is a great way to focus on process, but smaller purchases that involve a process to enjoy them, such as fine coffee, chocolate and perfumes, are also known to be a source of pleasure and joy.
4. Think logically and emotionally before making a purchase.
Thinking logically and balancing your budget is very important, but it also pays to think emotionally about what you are getting with each buy. A relatively easy way to do this is to separate the necessary from the desired and ask yourself what need each purchase is satisfying. For instance, a Rolex and a Casio both tell the same time. While this can be hard advice to follow, try staying away from luxury for luxury's sake. If luxury is a must, combine it with an experience. Share the momentous occasion of an extravagant purchase with someone and include them as much as possible.
5. Buy lots of small pleasures rather than one large buy.
With happiness as the ultimate goal, it is better and more efficient to buy a variety of smaller pleasures rather than spend large sums in one go. In this case, quantity and quality go hand in hand.
