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The Happiness Files by Sonja Lyubomirsky

The Weird Reason More Money Isn't Making You Happier

Published over 1 year ago • 2 min read

Welcome back to The Happiness Files, Reader.

Last time, we talked about the paradox of gratitude fatigue—how a practice meant to boost happiness can backfire when it's overdone. Today, we’re diving into another nuanced question—one that gets oversimplified far too often:

Does money buy happiness?

It's a classic debate. People assume that the answer is a straightforward “yes” (or maybe a guilty “yes, but...”). But the research tells a more interesting story. Yes, money can make us happier—but only if we spend it right.

Let me explain.

The Surprising Truth About Money and Happiness

When my former Ph.D. student Joe Chancellor and I reviewed decades of studies, we found something interesting: While income does relate to greater happiness, the relationship is surprisingly modest.

In fact, once basic needs are met, additional income has diminishing emotional returns. What matters more than how much a person has is how they use it (12 † Chancellor & Lyubomirsky, 2014).

In other words, money can buy happiness—if it's spent in ways that align with psychological principles of well-being. And one of the most effective ways to do this? Practicing thrift.

The Joy of Thrift

Thrift isn’t about stinginess or sacrifice. It’s about strategic underconsumption: Consuming less, but with greater awareness, gratitude, and purpose.

Thrift gives us a powerful happiness boost by reducing social comparison, slowing hedonic adaptation, and aligning our spending with what truly matters (granted, this is unique to each person) [12 † Chancellor & Lyubomirsky, 2014].

  • Buying fewer things is likely to lead to more enjoyment and appreciation.
  • Our ability to resist consumer culture's endless “more” gives us more space for meaning.
  • Resisting the urge to chase the newest Porshe or Birkin bag is a way to get off the “hedonic treadmill.”

3 Reasons Money Fails to Make Us Happier

  1. We choose poorly. We often spend money on things we think will make us happy—a bigger house, fancier car—only to find that the joy is fleeting. This is often the type of buying that’s done to “keep up with the Joneses” instead of buying based on our goals and values.
  2. We adapt quickly. The human brain is wired to get used to good things. That initial thrill? It fades faster than we expect, and then we're back looking for the next purchase to make us feel better.
  3. We spend excessively. Chasing the next purchase or lifestyle upgrade often leads to debt, stress, and disappointment. Again, think of the Joneses! Or better yet, don't 😉

When we practice thrift, we counteract these pitfalls. We make more deliberate choices; we appreciate what we have; and we reduce our susceptibility to comparisons with other people and with consumer pressure.

I had a fun conversation about this with Mark Manson! Click here or the image below to watch on YouTube or listen on Spotify here.

Try This Yourself

Here's a way to practice thrift this week. Choose one area of your life to “buy less, enjoy more.”

  • Skip the takeout and cook a meal from scratch.
  • Resist the urge to upgrade a device or piece of clothing, and instead enjoy what you already own and think of the memories made.
  • Track one day's spending and reflect on what truly brought joy. Extend to a week and you'll begin to see patterns. Follow them!

These small acts of “intentional thrift” can give a surprisingly large boost in well-being and happiness.

Why It Matters

Let's be honest. We live in a world (especially in the West) that equates more with better. Thrift invites us to pause, reflect, and reconnect with our values. It's not about doing without.

It's about choosing purpose over impulse, meaning over materialism.

Money doesn’t guarantee happiness. But the right mindset about money? That just might.

If you get a chance, reply to this email and let me know how you practiced thrift this week. I would love to hear from you!

Talk soon,

Sonja

Citation: Chancellor, J., & Lyubomirsky, S. (2014). Money for happiness: The hedonic benefits of thrift. In M. Tatzel (Ed.), Consumption and Well-Being in the Material World (pp. 135–160). Dordrecht: Springer. https://doi.org/10.1007/978-94-007-7368-4_2​

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The Happiness Files by Sonja Lyubomirsky

I’ve spent 37 years studying what contributes to well-being and stronger social connections. My new book, "How To Feel Loved", released in Spring 2026.

There’s a lot of advice out there about happiness, but only some of it is backed by science. That’s where The Happiness Files come in—I'll help you cut through the noise and focus on what you can do every day to be happy.

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