Money does buy happiness, but only to a point, study finds

Anew study has taken a stab at determining how much money it takes to be happy. And the findings may surprise you. Researchers at Purdue University studied data culled from across the globe, finding that happiness doesn’t rise indefinitely with income. In fact, there were cut-off points at which more annual income had a negative effect on overall life satisfaction.

In the U.S. and Canada, $65,000 was the optimal income for feeling happy.

Higher incomes “don’t seem to provide more benefit to positive emotions,” said Andrew T. Jebb, doctoral student in Purdue’s department of psychological sciences and lead author of the study.

The income figure is per individual. Different sized households can get a rough idea of their optimal income levels by multiplying $65,000 by the square root of the household size.

A family of four, for example, would need approximately twice the income, or $130,000. A family of three would need about $112,000, while a couple would need about $92,000.

Researchers also measured incomes against a person’s “life satisfaction,” which is a broader assessment that considers how satisfied someone is in fulfilling longterm goals such as achieving a certain education level, maintaining close relationships and finding a purpose in life.

“The satiation point for that tended to be later,” Mr. Jebb said. In North America, the optimal income for life satisfaction was $105,000 ($147,000 per couple).

Surprisingly, he said, incomes above $105,000 were associated with lower satisfaction.

“It’s not the higher incomes themselves. It’s the costs associated with them,” such as more responsibilities, greater time demands, more traveling and more mental fatigue, Mr. Jebb said.

Other factors could include increased desire for material things and more social comparisons, the study said.

The magnitude of the negative effect was “fuzzy,” Mr. Jebb said, because of less data at higher income levels.

“It seems to be a little detriment. It won’t make you miserable. That’s not what we found,” he said.

The study, which was published in January in the peer-reviewed journal Nature Human Behaviour, was based on data from

the Gallup World Poll that surveyed approximately 1.7 million people worldwide.

Mr. Jebb said the most surprising finding for him was that although the cut-off points for income and happiness differed by country, the phenomenon was universal.

“It’s cool to find commonalities among people,” he said. “That was probably my favorite part.”

So how should people use his findings?

“Be mindful of the limitations of income,” Mr. Jebb said. “That contrasts sharply with some of the images and messages we receive in the media and in society.

“Income is just one of the factors” that influence happiness, “no more so than social interactions and finding a purpose in life.”