Give Away Money and Become Happier

A couple weeks ago I talked about how to have a better life by giving/helping those in need. I pointed to a book on the subject that is backed up by some pretty significant research. (If you want more details, click the link and read the post.) That piece actually focused more on the benefits of volunteering -- helping people directly through service. But a new piece of research shows that giving money can also make you happier. The details:

New research reveals that when individuals dole out money for gifts for friends or charitable donations, they get a boost in happiness while those who spend on themselves get no such cheery lift.

Statistical analyses revealed personal spending had no link with a person's happiness, while spending on others and charity was significantly related to a boost in happiness.

"Regardless of how much income each person made," Dunn said, "those who spent money on others reported greater happiness, while those who spent more on themselves did not."

Pretty interesting stuff, huh? And the good news is that you don't need to spend thousands to become happier:

In another experiment, the researchers gave college students a $5 or $20 bill, asking them to spend the money by that evening. Half the participants were instructed to spend the money on themselves, and the remaining students to spend on others.

Participants who spent the windfall on others — which included toys for siblings and meals eaten with friends — reported feeling happier at the end of the day than those who spent the money on themselves.

So what's the reason people feel happier when spending on/giving to others? Well, that's a bit harder to determine. But there are some leading theories:

"I think it's a lot of factors of prosocial spending that are responsible for these happiness boosts," study researcher Lara Aknin of UBC told LiveScience. "I think it could be that people feel good about themselves when they do it; it could be the fact that it strengthens their social relationships; it could just be the act of spending time with other people."

Perhaps the fuzzy feelings associated with giving last longer than selfish buys. "The happiness 'hit' from giving may last a bit longer if the 'warm glow' from donation lasts longer than the hit from own consumption," said Paul Dolan, an economics professor at the Imperial College London in England. Dolan was not involved in Dunn's study.

Interesting stuff for sure.

As many of you know, I give all the money raised from Free Money Finance to charity and it makes me happy to do so. But long before I started this blog, giving was a major part of our finances (initially encouraged by my wife and then I caught the vision) and is part of our budget that we plan for every year. I can attest that it certainly is a great feeling to give as well as testify that the more you give, the more you receive.

Comments

[Rich Rogan - I Will Teach You To Be Rich With Investing]

You giving all the money to charity is seriously inspiring to me. I already give a little to charity (and yup, it does seem to make me happy!) but I'm hoping that my trading efforts will soon reach a level where I can give a LOT more.

[zen]

So I was thinking - a lot of people are talking about how they've all ready spent that "stimulus package" cash and are using it to pay bills.

What if - instead of saving it, using it for ourselves, we instead donate it to a charity? What better way to use the package than by donating it all to charity, to be spent (it's main goal) but in a way to help people (and our economy).

[Suze]

I'm a great believer in paying in out. It almost always comes back in some form.

I have mixed bag religious background, but the common denominator is that giving is divine.

[Finance Girl]

I would agree with this.

I wonder if those who are happier to begin with are also more likely to give away money.

[Dr. Artfredo C. bella Ph.D - Africa]

The saying "what comes around goes around" is applicable and synonymous to giving away money and become happier. Even the concept of the Rossicrussian would attest that the justification of becoming a millionaire is right for as long as the wealth accumulated would partly be for philanthropic
purposes. There is always that karmic law which says whatever you give it will return back to you. So if you part away your money for a worthy cause whether it will be for the charitable institutions, for the needy and for the street children, happiness will always be at your doorstep. Remember in the Bible, no less than Christ Himself advocated to a rich person when asked how he could attain happiness in life, Christ answered: " If you truly want to attain happiness in this life give all your fortunes to the poor and the needy." Even western authors would advocate that after all the searching of ways to become rich and wealthy, what is the ultimate aim in life? In the end, the ultimate aim of having vast amount of wealth is merely to share it with our less unfortunate brothers. Even great millionaires like John D. Rockefeller would advocate that it is the duty of every society and institution to provide descent job and compensation to its citizens. These advocacies had been made by great leaders and businessmen since they realize that parting away a portion of their money to the society and the less unfortunate ones will provide them ample happiness in life. Somehow, somewhere when you give away your money to the poor and needy it will repay you back a hundredfold. Parting away and giving your money is like throwing a boomerang, it will return back to your hands. Rich and successful business firms makes philanthropy a pillar of their operations. They realize that donating a portion of their wealth to a worthy cause would enable them to make their stay truly happy and justified. For what ever value is parted with there is a corresponding value received in return.

[Dr. Artfredo C. Abella Ph.D - Africa]

Posted by: Dr. Artfredo C. Abella, Ph.D. Africa

[Karma]

I loved your post. My real name is Karma and I am very spiritual about it. I truly believe that what you put out in life will come back to you. I love to give to people. When I have been able to give a gift to one of my children, buy something for someone, or just buy lunch for someone it always makes me feel good. It is rare that I can do this now because I am in college to get a degree (and hopefully my Doctrine in Psychology). I am 43 yrs old and only on my 2nd year, just got hit with a terrible divorce that left me in a very poor financial state. I know the temporary suffering of living on bread and water will be worth it because I want to work with juveniles who have had the misfortune of a life of crime due to no fault of their own. I am about to starve in the process but I do pray that when I am done I will be able to change at least 1 child's life to make him/her a much better person and prevent their own destruction or death. My heart is just racing right now thinking of how one day I hope to help someone. Most normal people get this feeling when they help someone. Others walk arond with their greed and won't even tip a waitress that has worked her tail off to give them a great night out. (and no I have never been a waitress ;+).
Karma is a very wonderful thing! I have felt it, lived it , dreamed it most of my adult life. When I was a child, I hated my name. Now, I call my dad and thank him over and over for the gift.
Karma Smoke

[Jolayne Miller]

I believe the people that get the most satisfaction out of giving away money, are people who have been poor there self once. I know this from personal experience because I am poor, and I have alway said if I could win the lottery or come up with a good idea, or would have made different desitions, I would help someone just like me. I think I would get more out of it because I know how it feals to go without due to poverty.

[Patty]

I wish someone would give my family money, we have lots of love, but it is hard living every day, I am so tried of the struggle we are a family of 6, to see the pantry getting littler, because my 3 boys are eaters, but I know God answers prayers...

[kenya waterford]

I think that giving is a blessing. I'm not rich. I do work and struggle like others but at times I do give. My car went down about five months ago, and I'm not able to fix it but I did give to toys for tots for this christmas which made me fill great. I know God will bless me in due time and that's the joy of giving. All though times are hard for me and my family we are still blessed. It's cold out and as long as the buses are running I consider that a true blessing. So I know god will answer our prayers.

[Beth Bowling]

My husband and I have been married 30 plus years. All our married life we have given just about everything we possibly could and in return would receive blessing after blessing for doing it. The great feeling you get is remarkable. The one thing that we were never really able to give much of was money. We have always lived on a shoestring, a very simple lifestyle. We always helped where help was needed. We believed that if you give out of love then you do not expect to get it back. I don't know, I always felt like if we were ever in need then all the people we reached out to would help us out. Boy was I wrong! A few years ago we found ourselves in a bad situation financially, we were on the brink of losing everything that we'd worked so hard for. We prayed, made phonecalls, sent emails and even sent out close to 100 letters explaining what was happening to family, friends, clients, church members, I mean everyone. You know how many helped us out? Not even a handful. So we ended up losing it all. So here we are trying to start all over again with nothing but a dream. A dream that one day soon I can hear our grandchildren say that they are going to grandma and papaw's house for a visit. Right now we are living with my husbands mother in a very small apartment so as you can see, they can't even come stay for a visit. I am really starting to lose all hope of ever having my own home ever again. But I will continue to pray and I also want to ask that each of you who read this, please pray for us too.

[Marc andre Bonaparte]

Giving is a great thing especially to those deserving it!but to expect a return,
only God is the sure repayer.(we have to built that wonderful world of giving and giving back,just like building a house to live in!)it's like my mom,she give, and if she don't get it back in time of need ,she is upset.Pray God doing his will and in faith,he will repay you remember what he say"I'm Holly so also must you be." read his bible his commandments to find what's wrong!