Money and Happiness

My wife emailed me David Brook’s column in the NY Times today.  David writes about the relationship between money/ professional success and personal relationships through the lens of  Sandra Bullock’s current situation.  What’s interesting for me is that a couple weeks ago when teaching my personal finance class to high school seniors at Sunset High School I posed this same question to the students (see slide #10 at THIS LINK):

Can money buy happiness?

Conversely, does a lack of money breed unhappiness?

Working in groups the class came to a consensus that in general once a person has satisfied their basic needs (i.e. food, shelter, love, spiritual) more money will not substantially increase a person’s happiness.  And in today’s NY Times David writes:

…the relationship between happiness and income is complicated, and after a point, tenuous. It is true that poor nations become happier as they become middle-class nations. But once the basic necessities have been achieved, future income is lightly connected to well-being. Growing countries are slightly less happy than countries with slower growth rates, according to Carol Graham of the Brookings Institution and Eduardo Lora. The United States is much richer than it was 50 years ago, but this has produced no measurable increase in overall happiness. On the other hand, it has become a much more unequal country, but this inequality doesn’t seem to have reduced national happiness.

Good work Mrs. Taylo’s class!

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