Money Doesn't Buy Happiness

People often aspire to be in management or leadership because of the potential increase in compensation that comes with the promotion. We seem to be motivated by the notion that as our compensation increases, so does our happiness.

Research would suggest the opposite. Studies support that more money can make people happier when they are at lower incomes. However, after about $75,000, that seems to flat line. Studies also suggest that happiness doesn’t increase when the income level goes from $200,000, to $500,000, or even to $1 million. Now that may be hard to believe, but when I think about my own personal experience from an entry-level sales rep to a CEO, I tend to agree with this concept.

I remember starting in sales just out of college and making $18,000 my first year at Marco. As my income increased, I could finance a house, buy a nicer car and think about starting a family. It’s those front-end life expenses that often motivate us to want to earn more. The reality is that it may not take as much money as we think to live a life of happiness. We’ve heard it before, “money doesn’t buy happiness.” So what does? Here’s what I found over my 30-year career:

  • Peace of mind: To me this comes from living within your means. I’ve always lived rather conservatively, and it gives me the feeling of financial control in my life. I think one of the worst moves people can make is to over extend themselves financially. Happiness is about making good decisions, not spending more and more money.
  • Right career fit: We are happiest when we are in a career that plays to our strengths. That’s when we feel most confident and perform at our best. For example, there have been many occasions when people say to me, “I want to be in a sales position so I can make more money.”  But when they get there, they’re miserable because it’s not a good fit. The position is not aligned with their skill sets and they would be much happier if they were in the right career.
  • Balance: What “good balance” looks like varies by the person. You do need to know what a balanced life means to you. We feel better and are more productive when we have the time to not only work hard, but also spend quality time on the things we enjoy most. When something is out of balance personally, whether at work or home, the happiness meter takes a hit.
  • Personal Wins: We all like to win. It makes us feel good and keeps us motivated. Wins look different to different people. A win for me is a productive day at work, getting to the gym for a workout and ending the day with a nice dinner with family or friends. Recognize what makes you happy and make it a part of your daily routine. 
  • Social Network: Marco has been recognized for its culture and being a place where people love to work. I often hear from our employees that they like the social aspect of our culture and the people they work with. We’re not created to work (or live) in isolation. We are motivated, entertained and made better by the people around us. Hanging out with the right people adds to your happiness.
If money doesn’t buy happiness and we know other influences are more important, I recommend you focus your attention toward these areas. So how could you help your employees? A good way to start might be to survey your workforce to see what motivates them. I think you’ll find that there are other influences that potentially have greater impact than money. It’s your job to find out what those are and make them an intentional part of your culture. So what’s more important to you – money or happiness?
Topics: Leadership, Culture