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Unselfish Spending Boosts Happiness

To Be Happier, Spending Money on Others Beats Spending on Yourself, Study Shows
By
WebMD Health News

Giving Makes Us Happier

March 20, 2008 -- Want to feel happier? Spending money on other people or charities may make you feel better than splurging on something for yourself.

Researchers report that news in tomorrow's edition of Science.

First, they asked 632 Americans to rate their general happiness and report their income and spending, including bills, gifts for others, gifts for themselves, and charitable donations.

The happiest people were the biggest givers, no matter what they earned, note the researchers, who included Elizabeth Dunn, PhD, of the psychology department at Canada's University of British Columbia.

"Regardless of how much income each person made, those who spent money on others reported greater happiness, while those who spent more on themselves did not," Dunn says in a news release.

Next, Dunn's team asked 16 employees at a Boston company to rate their happiness one month before receiving a bonus from their company, and again six to eight weeks after getting the bonus.

The workers also reported how they spent the bonus. Those who gave more of their bonus money to other people or charities were happier after getting the bonus.

Big bonus, small bonus -- that didn't matter. It wasn't about the size of the check; it was about how it was spent.

Giving in Action

Surveys are one thing. But what happens when people have cash in hand, and an order to spend that money before sundown?

Dunn and colleagues gave $5 or $20 to 46 people on the University of British Columbia's Vancouver campus. With the cash came instructions to spend the money by 5 p.m.

Some participants were told to spend the money on their rent, bills, or a gift for themselves. Others were told to use the money to buy someone else a gift or to donate it to charity.

Once again, the givers were the happiest at the end of the day, according to surveys they completed before getting the cash and after spending it.

And as with the corporate bonus, the amount of money didn't matter. People didn't have to give away $20 to feel better; giving as little as $5 helped.

"Our findings suggest that very minor alterations in spending allocations -- as little as $5 ... may be sufficient to produce nontrivial gains in happiness on a given day," Dunn's team writes.

Not What They Expected

Lastly, Dunn's team asked 109 University of British Columbia students -- who hadn't participated in Dunn's other experiments -- if they thought they would be happier spending $5 or $20 on themselves or on others.

Most students missed the mark.

"Participants were doubly wrong about the impact of money on happiness," write Dunn and colleagues. "A significant majority thought personal spending would make them happier and that $20 would make them happier than $5."

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