The myth of the money limit to happiness and how we seek more because we compare to others
KD reported that the effect of an approximately fourfold difference in income is about equal to the effect of being a caregiver, twice as large as the effect of being married, about equal to the effect of a weekend, and less than a third as large as the effect of a headache.
For some time in the past decade (and currently too), there was the widespread conviction, originated from empirical work in social sciences, that happiness—emotional well-being characterized by positive emotions—hits a limit at an income level of around US$70K as per the time of the landmark study by Kahneman and Deaton in 2010.
More recently (2023), this finding was challenged and rigorously put to the test by Killingsworth et al. (including Kahneman, one of the original study's authors) in this research. The results demonstrate no evidence of the flattening pattern of happiness—perceived well-being—when correlated with income. Happiness appears to increase consistently as income increases.
This may be an uncomfortable finding for some, and ego-boosting for others. On one hand, some people may feel a negative reaction to the findings because they wish money did not play an important role in our existence and fear that the constant act of seeking money generates greedy intentions, self-serving actions, and fallible outcomes that can have detrimental effects at the social level. On the other hand, some of you may feel that the scientific evidence supports their seemingly inherent constant motivation for earning more, and accumulating money can be a well-justified obsession in one’s life.
It appears clear that money is one of the many factors that contribute to a general, consistent sense of well-being. I wrote about the definition and components of happiness here. Due to the essential role money plays in society (we exchange goods, services, and knowledge for money) and the agreed-upon value we associate with it, we cannot deny that a higher level of income can increase the well-being of the average person, because you may feel safer, less tense and with lower stress levels. How much money is enough can be an individual answer you can find within you, and now may already be enough, if you inquire deep enough in a meditative sense.