How to Buy $100 Worth Of Happiness

They say money can’t buy happiness. They also say a watched pot never boils. Modern science, however, proves both statements wrong. Money, at least up to a point, is clearly capable of bringing happiness — as surely as heat boils water, watched or not.

Given that, here’s a practical question: If you had $100 to spend on happiness, how best would you spend it?

While the question may seem subjective (wouldn’t each person have a different answer?) the emerging science of happiness research tells us that there are some clear patterns that can guide you — ones that cut against some of our most deeply ingrained intuitions.

Let’s assume, of course, that your basic needs are met — food, shelter… iPhone. After all, the biggest happiness boost money can give you is the boost of not being mired in poverty or crushed by debt.

With the basics covered, what kind of purchases are most likely to bring you joy? Should that $100 go toward a Spy Pen from the SkyMall catalogue? A nice pair of shoes? A scarf for winter? Or how about a nice dinner out with your spouse? A play? Should the $100 go toward a weekend away?

It turns out, there’s at least one rule to guide you: Prioritize experiential purchases over material ones.

Experiential purchases are purchases like those toward the end of the list of suggestions above: purchases where you’re buying an experience, an activity, a memory instead of a thing. While people tend to resist experiential purchases because they seem too ephemeral — as if you’re throwing money away on something that’s gone as soon as it’s over — research shows that these are actually the types of purchases that bring us the most happiness.

To understand why look at an experiment, published in 2003 in the Journal of Personality and Social Psychology, that explored how people’s purchases made them feel over time. Researchers had Cornell undergraduates write a description of either a material or an experiential purchase. One week later, the undergrads were brought back in to read their descriptions. In both sessions, researchers measured the students’ moods, using an indirect test, which had them rate how certain adjectives, such as “enthusiastic” or “depressed,” applied to them at that moment.

What the researchers found was that the students’ moods were boosted far more by recalling an experiential purchase than by thinking about a material purchase. What’s more, the researchers found in a separate survey that people seem to spend a lot more time thinking about experiential purchases than about material ones. Why is this? The most important reason has to do with how our minds acclimate to things versus experiences.

Take that iPhone, mentioned earlier. The day you buy it, you may be tempted to build a shrine to it. But as soon as the new one comes out, it’ll start to look like dog food. The Alpo-ization process begins the day you pay for it. One of the most robust findings of happiness research is that we adapt to material advances (a raise, a new gadget, a new car) extremely quickly — requiring further and further advances to feel the same amount of happiness.

Experiences? They seem to improve, like wine or judgment, with age. Think about it. Which will look better in three years time: Your new car or the hiking trip you took to Alaska? You’ll probably suffer some unpleasantness on the hike — blisters, mosquitoes, "Palin for President" signs — but, unless your friend is eaten by a grizzly bear, you’re probably going to remember it fondly, with all the little annoyances fading from memory.

Your car, meanwhile, will be three years old. It’ll be a little scratched up. And you’ll hardly even think about it, unless it needs repairs.

There are some caveats to all this, of course. A follow-up study published this year in the Journal of Consumer Research found that a bad experiential purchase smarts worse than, say, a pair of shoes you come to hate. (Maybe, for instance, your friend did get eaten by that grizzly.) What’s more, the study found, for some highly materialistic people there may be essentially no difference between experiential and material purchases.

But those materialists should beware: Another robust finding of happiness research is that materialism itself is correlated with unhappiness.

Not all purchases, of course, fit neatly into one category or the other. Is that new car for show? Or maybe you’re buying it to take the family on camping trips? And, of course, there are plenty of non-essential material purchases that will nonetheless bring you plenty of happiness over time. But when evaluating that marginal dollar, perhaps it’s worth converting things and experiences into one mental currency for comparison: happiness.

The price of that new iPhone could easily pay for a weekend away. Maybe it should.

Ryan Sager writes the blog Neuroworld at TrueSlant.com.