Washington, Mar 21 : Money really can buy you happiness - but only if you spend your hard earned cash on others.
The finding is based on a new study by researchers at the University of British Columbia and the Harvard Business School, who found that spending money "pro-socially" i.e. as gifts or donations is what is likely to make you happy.
Said lead author Prof. Elizabeth Dunn at the UBC Dept. of Psychology: "We wanted to test our theory that how people spend their money is at least as important as how much money they earn."
As a part of the research, Prof. Dunn along with co-authors Lara Aknin and Michael Norton analysed a nationally representative sample of more than 630 Americans, of whom 55 per cent were female.
Participants were asked to perform a number of tasks that included: rainge their general happiness; reporting their annual income; and providing a breakdown of their monthly spending, including bills, gifts for themselves, gifts for others and donations to charity.
The result, says Prof. Dunn, showed that spending on others is what made people happy, regardless of their income.
"Regardless of how much income each person made those who spent money on others reported greater happiness, while those who spent more on themselves did not, " she said.
The boffins then measured the happiness levels of employees at a firm in Boston before and after they received their profit-sharing bonus, which ranged between 3,000 dollars and 8,000 dollars.
Once again, they found that it was not the size of the bonus, but how it was spent that affected happiness levels, with employees who spent more on gifts to others and charity revealing higher happiness.
In a third experiment, the researchers handed out 5 dollar or 20 dollar bills to the participants, telling them that it should be spent by 5 p.m. that day.
Half the participants were instructed to spend the money on themselves, and half were assigned to spend the money on others.
Once again, the researchers found that those who spent money on others were happier at the end of the day.