Does Money Really Buy Happiness?

Eight years. That was all it took for British garbage collector Michael Carroll to squander the £10 million he had won in the lottery. After spending his fortune on extravagant parties, luxury cars and drugs, he completely drained his bank account and returned to his former job. In interviews, he emphasized that he did not regret the way he said goodbye to wealth, although he also admitted that such an enormous influx of money brought out his worst traits. Only after returning to ordinary life did, he finally regain peace and balance.

In the 1980s, William Post won around $16 million in the Pennsylvania state lottery. For a man struggling with financial problems, it could have marked the beginning of a wonderful new life. Instead, it ended in massive debt, as the overly accommodating Post eagerly agreed to numerous donations, loans and business ventures proposed by those close to him. Bankruptcy deprived him of the prospect of a better future, but at the same time — in a sense — it saved his life. His own brother (who was later convicted for it) had allegedly hired a hitman to inherit Post’s fortune after his death.

At the beginning of the 2000s, the American Powerball lottery produced a record-breaking jackpot of $315 million. The owner of the winning ticket turned out to be Jack Whittaker. Unlike Carroll and Post, he was already a wealthy man, having successfully run a construction company for many years and earned millions. Yet in his case as well, sudden fortune proved to be a curse. Whittaker developed a gambling addiction, while several members of his family lost their battle with drug addiction. After eventually going bankrupt, he admitted that the jackpot had brought his family more suffering than happiness and that, if he could turn back time, he would never have bought the winning ticket.

According to the American National Financial Educators Council, as many as 70 percent of lottery winners lose all their money within just a few years. And along with it, they often lose their families, partners and friends as well. Looking at the stories of Whittaker, Post and Carroll, it is easy to conclude that money cannot buy happiness. But perhaps the problem is not money itself, but having too much of it? Or maybe the inability to manage it properly plays the key role here? Could it be that money is essential to achieving a certain level of life satisfaction? And when should we decide that we have finally reached that point — that we no longer need more in our bank account? 

Happiness for $100,000 or One Million Zlotys?

The last of these questions is not nearly as open-ended as it may seem, and surprisingly concrete answers can be found. Daniel Kahneman and economist Angus Deaton analyzed responses from more than 450,000 Americans who took part in surveys about life, emotions and financial circumstances. Participants were asked about, among other things, their levels of stress, sadness, joy and overall satisfaction, while the researchers compared these answers with their income levels. The results revealed a clear and obvious relationship: the more money participants earned, the more often they reported greater psychological comfort and a higher sense of happiness. However, this relationship held only up to an income of around $75,000 per year. The researchers identified this amount as the threshold at which a person reaches a financial level that allows most everyday needs to be met and reduces stress related to money.

The study by Kahneman and Deaton was published in 2010. Taking inflation into account, this financial “happiness threshold” would probably need to be adjusted to roughly $100,000 today. Would that amount satisfy the average contemporary American? That is something only Americans themselves could truly answer. Last year, however, Poles were asked — through the Ariadna Research Panel — how much money they would need to feel happy. The largest group of respondents (28 percent) pointed to as much as one million zlotys. Thirteen percent stated that they would need at least half a million. Slightly fewer participants chose the equivalent of 100,000 zlotys. Only one in ten respondents said they would be satisfied with 50,000. Meanwhile, one in eight valued their happiness at several million zlotys. 

The Economics of Happiness, or When We Know How Much Money Makes Us Happy 

Even if some of us find it quite easy to declare specific amounts of money, it is far more difficult to precisely define what we would want to do with that money to increase our satisfaction with life. It was precisely from such reflections that the economics of happiness emerged — a field that seeks to examine how income and material conditions influence people’s sense of well-being. For a long time, it was assumed that economic growth automatically translated into greater public satisfaction. In the 1970s, however, American economist Richard Easterlin noticed something entirely different. Although the residents of the United States were becoming wealthier with each passing decade, the level of declared happiness was not increasing proportionally to income and consumption. This phenomenon later became known as the Easterlin Paradox. Researchers therefore began to analyze not only income itself, but also emotions, stress, social relationships and a sense of purpose in life. It became increasingly clear that a person could live in great material comfort and still not feel fulfilled at all.

Years later, the debate surrounding the relationship between money and happiness was reignited by the research of Matthew Killingsworth. The American psychologist analyzed the daily well-being of thousands of people using a special app that regularly asked participants about, among other things, their current mood, activities and income levels. The findings suggested that happiness may continue to increase even after surpassing the famous financial threshold previously identified by Kahneman and Deaton. But Killingsworth observed something even more important — the greatest improvement in well-being came from money that allowed people to regain a sense of control over their everyday lives. Participants were far more likely to report higher levels of happiness when increased earnings reduced their stress, helped them avoid living paycheck to paycheck, or gave them greater freedom over how they spent their time. The issue, then, was not so much luxury as the ability to function more peacefully without constant financial tension. The research suggested that money has the strongest impact on happiness when it stops being a source of everyday anxiety and begins to provide a sense of security and greater independence.

Why Do We Always Want More?

The problem, however, is that people adapt very quickly even to things that once seemed like the fulfillment of their dreams. In psychology and economics, this phenomenon is known as hedonic adaptation. The mechanism itself is relatively simple: a new car, a larger apartment, a pay raise or a long-awaited promotion initially trigger excitement and improve our mood, but after some time they simply become an ordinary part of everyday life. People become accustomed to a higher standard of living surprisingly quickly, and their expectations almost automatically rise along with it. Importantly, this mechanism operates in nearly every social group — both among people struggling to make ends meet and among millionaires who, despite enormous wealth, still feel unsatisfied.

Closely connected to hedonic adaptation is also the theory of social comparison, according to which our sense of success depends not so much on how much we have, but rather on how we compare to other people. A person earning ten thousand zlotys a month may consider themselves fulfilled — at least until they begin surrounding themselves every day with people who earn three times as much. We buy a television worth several thousand zlotys, and, for a moment, it feels as though we have entered a new level of comfort. Yet all it takes is one visit to friends who own equipment twice as expensive for that excitement to be instantly replaced by a sense of insufficiency. 

This mechanism has also been observed for years by sports psychologists. Athletes who win silver medals often appear more disappointed than those who finish the competition in third place. Bronze medalists usually focus on the fact that they managed to stand on the podium, whereas silver medalists tend to dwell on their final defeat and think mainly about how little separated them from victory. Human beings therefore rarely evaluate their lives independently of others. Far more often, we focus on who is ahead of us rather than on how far we ourselves have already come.

The Internet Is Distorting the Value of Money

The pressure created by this mechanism is especially visible today in social media, which constantly feeds us images of other people’s success, exotic vacations and luxurious lifestyles. We have never observed so many people who seem wealthier, more attractive or more successful than ourselves. As a result, even an objectively high standard of living increasingly stops bringing satisfaction, because there is always someone who has more. 

Let us imagine a simple situation: we decide to spend our hard-earned savings on an exquisite dinner at a famous restaurant. We take a picture of the beautifully presented meal, post it on Instagram and, for a moment, genuinely feel happy. At least until a few minutes later, when we see a story posted by a coworker dining at an even more exclusive venue, drinking more expensive wine and eating a dinner that costs as much as our weekly groceries. The excitement fades almost instantly, replaced by the feeling that we are still somehow “below” others. In moments like these, it becomes very easy to believe that what we truly need to be happy is simply more money — even though just moments earlier we were sincerely satisfied with what we already had. 

The internet has also made money far more visible than ever before. In the past, people mainly compared themselves to neighbors, friends or others from their immediate surroundings. Today, every single day, we investigate the world of celebrities, influencers and millionaires who constantly present luxury as something completely ordinary. As a result, the line between real needs and aspirations begins to blur. It becomes increasingly difficult to distinguish between things that genuinely improve our quality of life and those that merely help create the image of success. Money therefore stops being only a way to live more peacefully and increasingly becomes a goal in itself — a symbol of status, prestige and confirmation of one’s own worth.

Poles Feel Happy Even Without Millions in the Bank

Perhaps this is precisely why — as the Ariadna survey suggests — it is now so easy for us to put a price on happiness and reduce it to a specific amount of money. In the same study, nearly 70 percent of participants openly admitted that money brings happiness (although only 17 percent of respondents in this group chose the answer “definitely yes”). Most of us, however, do not have hundreds of thousands or millions of zlotys sitting in our bank accounts. Does that mean we live in an unhappy society daily? Quite the opposite. The European Social Survey conducted at the turn of 2023 and 2024 showed that 77 percent of Poles considered themselves very happy, while 74 percent declared themselves very satisfied with life. In the report Satisfaction with Life in 2024 published by CBOS, eight out of ten Poles declared overall satisfaction with their lives. Around the same time, Ipsos also carried out its own survey, and the results differed only slightly: 72 percent of Polish women and men declared themselves happy. 

In each of these cases, the results were more optimistic than one, two or three years earlier. During that entire period, our salaries did of course increase, but at the same time our expenses also grew. We did not truly become wealthier, and yet we became happier. Does this mean, then, that money does not influence happiness quite as strongly as we tend to believe? When we look at the sources of happiness most frequently mentioned by respondents, they were usually children, partners, place of residence or social relationships. Slightly less often people pointed to general living conditions or health. Among the most common answers, it is difficult to find ones that directly refer to the possession of money itself. 

We Still Have to Invest in Both Small and Big Happinesses

It is difficult to peacefully build a happy family life when a person cannot afford to pay the bills, buy clothes for their children or provide them with healthcare and education. Relationships, a sense of security and everyday comfort also depend largely on one’s financial situation. Even health — so often identified as one of the most important sources of happiness — is inseparably linked to money: access to specialists, a high-quality diet, rest or the ability to live without chronic stress. Money therefore does not need to directly create happiness to have a real impact on many of the elements from which happiness is later built. Perhaps this is precisely why it is so difficult to separate psychological well-being from financial circumstances.

A similar dynamic can be seen in the case of work, which for many people is one of the most important sources of meaning, fulfillment and self-worth. A person may enjoy their profession, develop professionally and feel satisfaction from their duties, but it is difficult to speak of complete contentment when their salary does not allow them to function normally or fails to meet their expectations. Someone working beyond their limits while simultaneously living paycheck to paycheck quickly begins to feel frustration, even if they initially approached their work with passion. Research conducted by CBOS showed that only 38 percent of respondents identified income and material conditions as a source of happiness. This is a very small number compared to family, relationships or health, yet at the same time it is difficult not to notice that money is often what allows these areas of life to remain stable. In practice, it turns out that finances are rarely the most important source of happiness, but they very often determine how easily we can find it elsewhere.

The Truly Lucky Who Knows What Happiness Means 

In the iconic Polish comedy How I Unleashed World War II, the main character, Franek Dolas, encourages bystanders to play cards with him using the phrase: “Everyone can help luck along; everyone can win today.” And it is precisely this idea of “helping happiness along” that motivates us to buy a lottery ticket or place a bet. When we think about a great fortune, we do not imagine numbers sitting in a bank account, but rather the concrete things we would finally be able to afford. For some, it would mean buying a house, securing their family financially, starting their own business or developing personal passions. For others, it would be luxury cars, extravagant apartments, endless parties and carefree travel around the world. Each of us defines and perceives happiness differently, but what connects us all is the belief that money “helps along” that happiness — whatever form it may take and however much it may cost.

Michael Carroll, William Post and Jack Whittaker also believed that great wealth would “help along” their happiness. The problem was that they themselves probably never truly knew what that happiness was supposed to be. Canadian lottery winner Tom Crist used his fortune very differently, donating almost the entire sum of roughly $40 million to organizations fighting cancer. Meanwhile, Cynthia Stafford, after winning more than $100 million, focused primarily on providing stability for her family and developing her own business projects. The difference between these “lucky people” seems quite significant: some searched for happiness in money itself because they could not find it anywhere else, while others knew from the very beginning exactly what they needed money for and how they wanted to use it to bring happiness both to themselves and to others.

There Are Things You Cannot Buy with Money

Several years ago, a television commercial created by one of the world’s global brands became extremely popular. Its message was built around simple statements and appeared in many different versions. One of them showed a man and a child heading to a sporting event together. Text appeared on the screen reading: “Two tickets to the game — $120. Hot dogs and drinks — $15. Match program — $5. Spending time with your son — priceless.” A simple advertising slogan, yet at the same time a perfect illustration of the relationship between money and happiness. After all, the list of expenses could easily go on and on, but without that final sentence, none of them would really matter. Imagine instead a boy sitting alone in the stadium stands while his father, somewhere in the corridors of the arena, is busy calling clients and closing business deals.

Now let us erase the entire list of expenses from that commercial and leave only the final sentence: “Spending time with your son — priceless.” Suddenly, it turns out that happiness did not actually require a stadium, tickets or a sporting spectacle worth hundreds of dollars. After all, the two of them could just as easily sit together on the couch, watch the game on television and eat homemade sandwiches. Because although money often helps create comfortable conditions for experiencing happy moments, it is not in itself a guarantee that a person will truly be able to experience them. To refer to the message of the commercial — there are things you cannot buy with money. And it seems that happiness is one of them.