will more money make you happier

Summary

will more money make you happier. yes. up to a point. then it depends on what you do with it and what you actually want. the honest answer is more nuanced than either extreme will tell you.

1. want what you want. one of my big takeaways from 10x Is Easier Than 2x. if you want a $10 million beach house, want it. don’t shame yourself out of it. and if you don’t want it, don’t pretend you don’t want it just to look noble. that’s just performance from a different angle.

2. three studies on income and happiness, 2010, 2018, 2021. most agree there’s a sweet spot, roughly $60,000 to $90,000 a year. below it, financial stress eats happiness even if everything else in your life is good. I lived it. I had a wife, healthy kids, a roof, food, and was still wrecked by money stress because it was that tight.

3. past the sweet spot, the studies start to disagree. one says happiness keeps climbing with income, the others say marginal returns. I think both are right depending on the person. each tier above the threshold gets you marginal upgrades. fly coach versus first class versus private. all three get you there. better cars, bigger houses, marginal upgrades. they only really compound on happiness if you have a specific mission for the money.

4. my real theory is that happiness is allowed, not pursued. life is a river you’re floating down. obstacles show up, financial stress, broken relationships, bad health, fear. happiness comes from removing them so the current can carry you forward. sometimes that’s more income. sometimes it’s a hard conversation or a habit change.

5. money amplifies who you already are. it’s like alcohol. nice drunk gets nicer, hugs everyone. asshole drunk gets meaner, wants to fight. so the work is on who you are. know what you want, know how much you need, know the experiences you want to fund. answer those and the rest of the financial noise goes quiet. then chase the number. try harder.

Transcript

want what you want

The most impactful business is the business that genuinely improves another human, a better human business. And to grow a business like this, you have to continually improve yourself. This podcast is a documentation of that thesis, scaling businesses and also personal growth. My goal is for you to shortcut this journey.

So if you’re ready to try hard, subscribe. If you like what you’re hearing, please share and enjoy. Will making more money make you happier? Unfortunately, I think that it will. And that may not be the answer you’re expecting from me. So let’s dive into this a little bit more. My name is Jerred Moon and welcome to the Better Human Business Podcast.

Today I want to talk a little bit about finances or money and happiness and how they’re related in my opinion and what my experience has been in increasing my income over the last decade. I also talk to a lot of people about this because if you, I just help a lot of people with goals. And if you come to me, we’re talking about goals.

At some point we’re going to be talking about finances because almost every goal has a financial component. And one thing, if you listen to my book review of 10x is easier than 2x. One of my biggest takeaways was in the book, want what you want. Don’t be afraid to want what you want. If you want a $10 million beach house on the side of a mountain, whatever.

If you want it, want it. Don’t shy away from it. That’s the thing that you want. Don’t let anybody shame you into it. Because I also, if you tell me, because I get this a lot too, if you’re trying to act cool because you don’t need a lot of money and you don’t want things, that’s no different to me.

I don’t care if you’re like, yeah, I drive a used car and I live in a $1,000 house. How awesome. I don’t care. And even if you’re the person who’s like, yeah, I want a $10 million mansion. I can’t afford it right now, but that’s ultimately what I want. I don’t care. Like just want what you want. That’s what I want for everybody.

the 60 to 90k sweet spot

Just want what you want. Don’t think that you’re cool because you don’t spend money and don’t think that you’re cool if you have a lot of money. Just want what you want and don’t let other people interfere with your goals. Now, in looking at a lot of the research on this, and this is often what comes up, there are three different studies that have been done on this.

One was done in 2010, one was done in 2018 and one was done in more recently, 2021. And I’ll tell you the gist of these three different studies and their studies on the relationship of money and happiness. Most of them find that there’s a sweet spot and the debate is where the sweet spots at. From what I’m reading, the sweet spot seems to be around $60,000 to $90,000 per year.

So that’s the sweet spot of where money actually will make you happy. But then after that, there’s no increase in happiness after that range. That’s what these studies say. One of the studies contends that notion and says there’s not actually an upper limit that you can still remain happy like by making more money and making more money.

But I think that has a lot to do with what you do with your money and what your goals are. If you’re making less than that sweet spot, yeah, I do think that it can cause a lot of stress and anxiety. This was my case when I was earning very little money. Like I had everything, I had every reason to be happy early on as an entrepreneur.

Like I was married, or I still am married, I’m married, had healthy kids, I was healthy, roof over my head, food on the table, everything was good, but it was tight, like really tight financially. And it caused me so much stress, I couldn’t actually be happy. So I understand this sweet spot. Like even though you have everything in your life going for you, there’s still just, it’s hard to realize it sometimes.

It’s hard to realize it when you are just like, no, I’ve got to fix this one problem and that can be finance. So there is going to be a sweet spot. But I also agree after a certain point, it doesn’t really matter because all it really gives you are marginally better options. So if you go from I can’t afford to fly to I can fly coach to I can fly first class to I can fly private, but once you can afford to fly, like they’re all getting you there.

marginal upgrades after the threshold

Like one is definitely better than the previous, but we’re still all traveling, like we’re all going somewhere if you can afford those things. And it’s the same with a vehicle. I have a car that gets me from A to B. Oh, I have a really nice car. Oh, I have two cars. I have a sports car and whatever else, whatever people do who like cars.

And then same with a house. Like I have a small apartment, which is a roof over my head and blah, blah, blah. Then I have a house and now I have a bigger house and an even bigger house. Like all you’re doing after a certain point is like marginal upgrades and those things might be awesome for you. You might want them.

I want some of those things like Emily and I are really into real estate. We’ve remodeled bathrooms. We built the office I’m sitting in now. We’re building a new house. We enjoy those things. We enjoy the process. We enjoy picking the finishes. We just enjoy those things. And so that’s something that we want.

No shame in it. I’m not a car guy, but I won’t shame anybody who wants the car. So you just really have to know what you want. So I definitely agree with these studies on that. Too little is going to cause you a lot of stress and anxiety and then too much. I don’t think that it really improves your life anymore unless you are very mission driven and like you do have just this impact.

Hey, I want to take all my money and give it away or I want to experience things with my kids or like what you, if you have a very specific goal and you need lots of money to achieve that goal, then I think making more money could increase your happiness even to higher levels into the six figures and beyond if you’re very specific on what you want to do with it.

happiness as removing obstacles

But my actual thoughts on happiness are that happiness is something that has to be allowed. It’s not something that can be achieved or necessarily worked on. Like we’re all in this, we’re all in life, right? We, if you’re listening to this, you’re alive and there’s a finish line. We’re all headed towards that finish line.

We can’t stop it. And so let’s just pretend we’re, we’re in a boat, we’re going down a river and once you reach the end, you’re done. And I think that what happens in life, what causes stress or won’t allow happiness is you come up on a batch of rocks or a log will get thrown in or a bunch of logs or whatever.

And what you have to do is remove these things to just allow happiness to be there, to continue and to be happy. And so sometimes that is going to be earning more money. Sometimes that’s going to be removing a negative relationship for, from your life or not doing things that you don’t want to. But everything is going to come back to being who you are and knowing what you want.

And so will money make you happier? It absolutely will. If you don’t have enough, it absolutely will. But you’re only going to be amplified by the amount of money you make. So if you are a crappy person right now, you’re going to be more of a crappy person when you earn more money. It’s just like when someone drinks too much alcohol.

If you’re a nice guy and then you drink a lot of alcohol, you’re just a nicer guy, wants to give hugs when you’re drunk. And then there’s the guy who’s an asshole and then drinks more alcohol, wants to fight everybody. And that’s the same thing that money’s going to do. It’s just going to amplify who you are.

And so that is just something that you need to take into account. So go ahead and set your goals. Everything I really talk about comes back to knowing who you are and knowing what you want. Because I feel if you know who you are and what you want, you don’t have to pretend. You don’t have to pay lip service to any of these things.

money amplifies who you already are

I really do see a lot of people who think that it’s noble to not earn a lot of money. It’s noble to drive a used car and live in a crappy house because Dave Ramsey said it and it makes you feel good. But does that actually make you happy? Does it make you happy? just doing those things because you either A, have to, or B, this one’s worse to me, you want to be perceived as a person who doesn’t want or need things.

There’s a big difference. If I’m driving a crappy car and living in a crappy house because I have no money is one thing. If I’m driving a crappy car and I’m living in a crappy house, even though I could afford a lot more, but the only real reason is because I want you to think of me differently. It’s no different than the person who’s buying a Lamborghini and living in a mansion because they want you to think of them a certain way.

So pretending to be poor or being rich would be put you in the same mindset of you want to be perceived differently through some sort of financial lens. So you really have to think about these things and unpeel the layers. But if you know exactly what you want to do with your money, how much you need, the experiences you want to have, you have answers to all those questions, all of this gets a lot easier.

You’re not worried about what to invest in. You’re not worried about what other people are doing. You’re not worried about any of that stuff because you know exactly how much money you need to live the life you want. And when you have those goals and you’re marching towards them, that’s a big step in towards allowing happiness and allowing happiness is not an easy thing, but it’s something you absolutely should strive for.

Try harder.