LOS ANGELES — Many people believe that money can’t buy happiness, but a recent study has found that different social classes experience varying levels of happiness from specific types of purchases.
It turns out there’s something to “retail therapy” after all, but it comes with an asterisk. Researchers from several universities set out to determine the best way to spend money in order to increase happiness, and found that the answer seems to hinge on one’s economic status.
After conducting a series of studies, researchers concluded that wealthier individuals derive more pleasure from buying experiences or trips, such as a concert or vacation. Meanwhile, lower class individuals reported more varied tastes; some said they derived the same level of happiness from both physical goods and experiences, while others feel happier with shiny news toys as opposed to a vacation or event.
There is a general belief in today’s society that experience-based purchases lead to happiness far more frequently than buying a new pair of pants, for example. This belief is called the experiential advantage.
“However, this simple answer to the question of how to best spend your money does not consider the huge economic disparities in our society,” says researcher Wendy Wood of the University of Southern California in a statement. “We reasoned that the basic motives that shape consumer decisions would vary between higher-class and lower-class consumers. Thus, we anticipated that the degree of happiness obtained from different types of purchases would also vary by social class.”
Researchers theorize that wealthier individuals enjoy buying experiences more because they have the luxury of being able to focus on things like travel goals, personal development, and internal growth. Conversely, lower class people struggling to get by are more focused on getting the material items they need.
“For lower-class consumers, spending money on concert tickets or a weekend trip might not result in greater happiness than buying a new pair of shoes or a flatscreen TV,” explains co-author Deborah Hall of Arizona State University. “In fact, in some of our studies, lower class consumers were happiest from purchasing things, which makes sense given that material goods have practical benefit, resale value, and are physically longer lasting.”
For the study, researchers first performed a meta-analysis on over 20 studies worth of data on financial differences among college students. They found that college students who attended more expensive universities reported more happiness from experience-based purchases than college students attending more affordable, public universities.
In the next study, participants were asked to recall both an experiential and a material purchase they had recently made, and declare which purchase made them happier. Again, the results suggested that wealthier individuals tend to derive more happiness from experiences, while lower class participants remembered feeling more happiness from buying physical items.
The final study asked participants to randomly recall either an experiential or material purchase. The results indicated that individuals with at least a Bachelor’s degree, who make at least $80,000 a year, enjoy the most happiness from a purchase when it is experiential. On the other hand, individuals making less than $80,000 per year reported about the same level of happiness from both experiential and physical purchases.
Even participants who just imagined making less money stated they felt about the same level of happiness from recent purchases of both kinds, and participants who imagined making more money suddenly reported greater happiness from experiential purchases. Researchers say this illustrates that purchase-induced happiness can be influenced depending on even momentary changes in a consumer’s financial mindset.
“The take-home message is that, when it comes to increasing one’s happiness through discretionary spending, there is no single ‘right’ answer of what to buy,” comments Jacob C. Lee of the Ulsan National Institute of Science and Technology.
The study is published in Psychological Science, a publication of the Association for Psychological Science.