Your money or your life

Research

Are you in the middle of deciding whether to change your career or your job?  Then it’s odds-on that you are going through plenty of handwringing over the financial implications of doing that. Is it happiness you’re after? Or is it a less stressful life? Is it the belief that earning more money will make you happier and less stressed? Or is money not that important to your happiness?

Two research articles published this year examine the complex relationship between money, happiness, and stress. One examines the way that the relationship between income and happiness has been measured before. The other was novel in its consideration of how income and stress affected the prevalence of happiness. Both articles give some cause for reflection on the implications of career and job decisions on your stress levels and whether the price of change is worth paying.

Lauro Demenech et al collected data from 1168 people aged 18 or over in Southern Brazil. They found that less-stressed people had higher levels of happiness that remained stable regardless of income. They also found happiness levels among both rich and poor individuals decreased as stress levels increased – albeit the decrease was more pronounced in the poorest than the richest.

So, regardless of whether that career or job change is going to bring you more or less money, it might be worth considering whether it will increase or decrease your levels of stress.

Consider whether it’s work that causes you stress and unhappiness. Could it be some other aspect of your life that will remain the same regardless of whether you make the change?

Demenech and his team found that the wealthiest people tended to be happier and less stressed. However, this may be because money can be used to buffer sadness more than enhance happiness.

In their article, Kudrna & Kushlev note reports that people living in high-earning and well-educated households feel more time stress and dissatisfaction with their leisure time. There is also evidence that people with higher incomes spend more time alone.

Maybe this suggests the reason why ‘salary’ is sometimes referred to as ‘compensation’.

The idea that higher levels of income result in higher levels of happiness but with a diminishing return is widespread. ‘Happiness plateaus’ of $75k pa or £50k pa have been suggested. However, the methodologies behind these studies are called into question  - including how we define happiness.

As Demenech et al note, there is an extensive debate about whether happiness is the main goal of human life. Philosophers since Aristotle (at least) have pondered the question.

Whether you earn more or less money as a result of any career decision you make, will that lessen or exacerbate the stresses in your life? And how will that impact your happiness? - if happiness is important to you at all.

REFERENCE:

Demenech, L.M., Almeida, R.B., Neiva-Silva, L. and Dumith, S.C. (2022). Does money buy happiness? Disentangling the association between income, happiness and stress. Annals of the Brazilian Academy of Sciences. 94(2). Online ISSN 1678-2690

Kudrna, L. and Kushlev, K. (2022). Money does not always buy happiness, but are richer people less happy in their daily lives? It depends on how you analyse income. Frontiers in Psychology, 13:883137 doi: 10.3389/fpsyg.2022.883137