I read a cool little book 2 months ago called “Happy Money.”
I finished all 160 pages on a return flight from NYC . It was handed out at this cool marketing conference called BehaviourCon, by the author himself, Michael Norton. He gave a speech on transparency as a strategy in marketing your business.
I wasn’t expecting much, but this was a fun quick read based on latest science. You can’t argue with SCIENCE!
How to spend money in a such a way that maximizes your happiness ? Don’t buy so many material things, buy experiences! Right? Exactly. It goes into certain nuances of that wisdom.
It breaks spending happy money into 5 principles.
1. Buy experiences
Housing and Transportation are not particularly good sources of happiness in the long term. Important to know since these are the largest material purchases most people ever make.
Working long hours to earn more money to provide your children with fancier home may represent a bad happiness trade-off.
Remarkably, length of an experience (holiday) has little impact on the pleasure people remember deriving from it.
It goes into one extreme example – spending 200,000 dollars on Virgin Galactic 6 mins flight to outer space will give you more lasting happiness than a material purchase of similar amount.
Shifting your focus can alter whether a purchase feels like an experience. Talks about this amazing restaurant – elBulli, made dining an amazing experience that resulted in 1-2 million reservation requests per year, yet just served 8,000 customers.
2. Make It a Treat
Limiting your access to everything from the McRib to Maseratis helps to reset your cheerometer. That is, knowing you can’t have access to something all the time may help you appreciate it more when you do. Think Charlie and Chocolate Factory. This is a win-win for both consumer and buyer.
There is Classic Car Club in Manhattan when you pay $11,000.00 for thirteen days of driving the clubs “high-end supercars”. Those magical thirteen days gives you more pleasure than owning one.
All else being equal, most people report they would rather have larger number of smaller pleasures, rather than a smaller number of larger pleasures. For example, prefer to get a $5 a day for five days, than $25 all on one day.
3. Buy Time
Don’t Watch TV as much, Cut Your Commute Time and Engage in more socializing with friends and family or join a art class, etc.
Taking a bike to work (even once a week) can transform our happiness commuting time into happiness inducing physical activity time.
Thinking about Time – rather than money – spurs people to engage in activities that promote well-being, like socializing and volunteering.
For example, concert goers felt more enthusiastic about the event when they thought about the time (verses money) they had spent to be there.
4. Pay Now, Consume Later
Vacationeers exhibited a bigger happiness boost in the weeks before their trip, rather than in the weeks afterward.
If you plan to “reward” your friends for helping you move with nothing more than cheap beer and pizza, they’re more likely to be satisfied with Bud Light and Dominos’ if you have them over the day after the move rather the day before.
Talk about Virgin Galactic Trip again. The anticipation toward the 6 min flight to space- the value of the trip stems in part of looking forward to it.
Research show that waiting can increase satisfaction if customers get the impression that work is being done on their behalf during the delay.
This “labour illusion” is so powerful that it leads to customers to prefer services that make them wait to services that provide the same quality immediately.
Purchases that have been paid for long ago feel free, thereby liberating people to spend their time in happier ways.
5. Invest in Others
This is what people report spending the least, though is excellent source of happiness. Try giving 5 dollars once in awhile to a friend. Not suggesting give all your money away.
Donations to a food bank elicited more activation in brain regions associated with reward when the contributions were made by choice rather than being obligatory.
Individuals who agreed with statements such as “I feel that my work makes a positive difference in other peoples lives” were less likely to experience emotional exhaustion at work. Goes into cause-marketing as well.
Some research suggests chasing happiness can be counterproductive.
People who were told to try make themselves feel as happy as possible while they listened to some pretty good, but not fantastic music reported feeling less happy than those who hadn’t been given any instructions.
Seneca: Things that were hard to bear are sweet to remember.
P.S. Check out these songs by two NEW bands that need to save music. Jagwar Ma and Temples! Don’t feel obligated to.