Does borrowing money finance happiness?
The Psychology of Money
Borrowing money is a way of life for most people. Whether it is for a home mortgage, auto financing or a pricey item purchased on a credit card, most do not mind creating debt by borrowing money, as long as their dreams can be financed right away. While there is nothing intrinsically wrong with this, as long as a borrower can comfortably afford to repay their loan or credit debt, it is nonetheless interesting to consider why borrowing money is so popular.
Money and Happiness
Is it true that money cannot buy happiness? If so, why is it that so many people anticipate that it will? What is it about money that makes human beings feel as though, the more of it they have, the better they will feel about their lives? And why does it seem that some of the wealthiest people are also the most miserable and insecure?
Money buys satisfaction, not happiness
Researchers who study the psychology of money, including famed psychologist and esteemed Nobel laureate, Daniel Kahneman, have suggested that people believe money buys happiness because, when they can afford the material trappings of their dreams, even when this involves borrowing money to finance their purchases, such makes a statement to the world that they are productive members of society who are able to accomplish conventional goals that the rest of society is also striving for. It is this nature to compare and measure one’s accomplishments by this preset standard that is the true motivation. Therefore, people equate money with happiness, because their happiness has been defined by what their main social group strives to achieve. In reality, however, psychologists believe that money only buys fleeting satisfaction and not true happiness.
When researchers have delved more deeply into studies relating to money and happiness, they have discovered that people with a lot of money, when asked on a regular basis about their happiness, do not report being happier than people of lower financial rankings. Instead, these studies reveal that people with more money are often more satisfied and comfortable with their lives, but were also more stressed by the day to day demands of their career positions or the activities that they engage in in order to maintain their standard of living. So, while they were more satisfied, this stress actually hampered their actual feelings of happiness.
The media, money and illusions of Happiness
Because most people are bombarded with daily images suggesting that money equates happiness, those who feel like they don’t have enough of it often find themselves obsessed with chasing more money, while creating more debt and increasing their levels of stress. Very few images in the media, which emphasize happiness without a lot of money, exist and, therefore, most people’s minds are trained on obtaining more money while feeling unhappy or dissatisfied when they aren’t able to do so. Such leads to higher instances of people borrowing money that they cannot afford to comfortably repay.
Happiness vs. Satisfaction
Instead, those interested in the psychology of money and its correlation to happiness are encouraged to distinguish between what makes them feel satisfied and what makes them feel happy. Doing so, of course, is an inside job and will vary from individual to individual. While money is necessary for affording basic needs, such as food and shelter, those who earn enough to comfortably afford these are advised to study their own motivations for acquiring more than what they need, such as a larger, more expensive home, and why they are willing to go into debt in order to achieve such. There is nothing wrong with doing so, as long as one can afford to, but if a person is seeking more happiness in the process, they should recognize that happiness isn’t for sale and that the illusion that it is may very well lead them down a dark path of bad debt and bad credit.