University of Minnesota - UMN Executive Leadership Insights
Happy Money
Book

Happy Money

The Science of Happier Spending

Elizabeth Dunn and Michael Norton
Wall Street Journal Books, 2014
Buy book or audiobook

Read offline

Amazon Kindle

Editorial Rating

8

Qualities

  • Innovative
  • Applicable

Recommendation

Having money won’t make you happier – but spending it might. The right spending habits can produce measurable changes in your physical and emotional well-being. Elizabeth Dunn, an associate professor of psychology, and Michael Norton, an associate professor of marketing, distill their findings in this field into the five principles of “smart spending.” Among their tips: Don’t buy stuff; buy experiences. You’ll get more happiness out of a trip overseas or a visit to a museum because you’ll connect with other people and accumulate memories. This quick, breezy book balances anecdotes and corny jokes with a broad survey of current economic research. getAbstract recommends its tales and advice to those seeking insight into the psychology of spending – your own and your customers’.

Summary

Money and Happiness

The latest research shows that money can indeed buy happiness. You just have to know the right way to spend it. Don’t expect to find happiness by buying a new pair of shoes or even a house in the suburbs. Material goods offer only a temporary lift for your spirits. To spend your way to happiness, seek experiences that connect you to others, reinforce your sense of identity, and give you more free time and great memories. You can even derive more pleasure from your possessions by adopting some simple “happy money” tactics. Behavioral research suggests five principles that can help translate your purchases into happiness and satisfaction. These principles apply to individuals and to businesses, so managers should keep them in mind as they strive to satisfy their customers and employees.

1. “Buy Experiences”

Acquiring material goods doesn’t contribute much to happiness. You might experience a momentary lift, but satisfaction fades away with time. “Buyer’s remorse,” the worry that you could have made a better choice, can quickly extinguish purchasing pleasure. On the other hand, buying an experience provides lasting satisfaction. The more time...

About the Authors

Elizabeth Dunn teaches psychology at the University of British Columbia. Michael Norton is on the marketing faculty at the Harvard Business School.

Comment on this summary