Does money make you happy?

Pharrell Williams' song Happy has us all singing and dancing, but how much do you rely on your financial affairs to dictate your state of happiness?
Gary Clement  for The National
Gary Clement for The National
The song doing the rounds in my head these days is Pharrell Williams' Happy - what a great song.

This is one of its lines: "Clap along if you know what happiness is to you".

And do you?

Know what happiness is to you, that is.

There seems to be a pattern when it comes to working this out: first we need money in our life to figure out what happiness is - and then realise that it's not about having money.

Let me explain. For many, this is life: looking for the next happiness-fix - something external that'll make you feel great and good about yourself.

If so, stop. You're headed for happiness-hell: a place where it's always about what you don't have, about the next thing you'll buy.

In fact, you're buying feelings.

And this means spending money.

Perhaps you've cottoned on that today's word is: "happiness" and I'm looking at the role of money in finding it, and more importantly, staying happy.

Let's take a look at what I'm calling the "great happiness pyramid":

The base of the pyramid is the "buying things" entry level.

The next step up is "buy experiences, not things".

And then what? What's the pinnacle of this happiness pyramid?

Well, if we start with ground zero being happiness equals spending money, then how about turning it on its head to get this: happiness is keeping money.

I was asked a few days ago whether I have cash to spare for a "couple of weeks" - someone I know needs to find money to cover cheques that will be presented this month and they will bounce if money isn't conjured up.

This makes for a very stressful life. And it's by no means an exceptional way to be: the average person lives on a knife-edge of matching up money in vs money out every month. Falling off the edge is an easy, and bloody affair.

But there's another way to live. Imagine a life where there is no shortage of money. Where you are not stressed. Where you are relaxed.

A study by my financial empowerment platform showed that the biggest cause of stress in the UAE is financial worries.

So let's think this: happiness means being at peace. Financial peace is key.

How can we achieve this?

Money in the bank, and ideally money coming in passively from investments; this frees us from the hellish hamster wheel of making ends meet and brings with it the chance to sit, think, read, reflect, build closer relationships, and in doing so figure out what truly makes us happy.

According to research, this is Happyville: a place where you have friends. I don't mean the Facebook variety, no, I mean close, real, flesh and blood types, with whom you can discuss important issues and problems. Various surveys find that if you have five or more friends like this, then you are 60 per cent more likely to say that you are "very happy".

It's a place where you learn things and set goals for yourself.

The psychologist Jonathan Freedman claims that people with the ability to set objectives for themselves - both short-term and long-term - are happier.

And Happyville is where you can discuss what you're learning and doing. It turns out that happy people are socially engaged with others, and this engagement involves matters of substance, stretching yourself, learning, discussing - not a small talk fest.

Eleanor Roosevelt, the US diplomat and reformer, put it rather aptly: "Great minds discuss ideas; average minds discuss events; small minds discuss people." Change "great" for "happy", and there we have it.

A super example of this is the monthly science gathering in Dubai which took place last weekend - it's called Café Scientifique, where, to quote the website, for the price of a cup of coffee, anyone can come to explore the latest ideas in science and technology.

We've heard it all before: money buys happiness - up to a point. But how about being a hot-air balloon, in that room without a roof - to quote Williams.

So, to go up a level on the Great Happiness Pyramid, I'm setting you a challenge.

Do you have five people you can talk to about any and everything? If so, lucky you. When's the last time you got in touch?

If not, work on it.

Next, decide on one thing you'd like to be able to do and go get lessons. Whether it's playing a musical instrument, surfing, a new language, the possibilities are endless. And lastly, bring the two together: meet up with people you can talk to about the myriad of fascinating things life and the universe have to offer. And soon you'll be in Happyville: a place within you.

Nima Abu Wardeh is the founder of the personal finance website www.cashy.me. You can contact her at nima@cashy.me

Published: May 2, 2014 04:00 AM

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