We all have been told countless times by our parents, our wise peers, and our rich friends that “money isn’t everything” (yeah easy for them to say!) But maybe they’re right. Maybe it’s not necessarily the money that makes us happy – not directly anyways.
Some would argue what makes us happy is the freedom that money gives us – the freedom from stress, worry, constraint and limitations. According to a Wall Street Journal article, research tells us that “Yes, people with higher incomes are, broadly speaking, happier than those who struggle to get by,” but “what matters a lot more than a big income is how people spend it.”
A study featured in an article in TIME Magazine tells us that a person’s emotional intelligence can predict how much they earn. The study looked at “emotional recognition ability” which is the ability to understand another’s emotions based upon their face, voice, and body language, along with a variety of other interpersonal skills in 142 German workers.
According to the article, “High emotional recognition was linked to a higher salary, even after controlling for salary-bumping factors like age, gender, education, work experience and work hours.” The study tells us “This very basic ability has effects on the interpersonal facilitation facet of job performance and, most notably, even on annual income, an objective indicator of career success.”
It’s important to note that according to TRACOM’s research, the behavioral elements of emotional intelligence lead to the most visible and meaningful improvements. This is why we devised an Emotional Intelligence Model that focused on the most practically important aspects of EQ, distinguishing between Emotional Intelligence and Behavioral Intelligence. Emotional Intelligence focuses on emotion awareness, recognition, and understanding, while Behavioral Intelligence represents practical skills that directly influence others and our own effectiveness.
As mentioned earlier, a Wall Street Journal article, research tells us that “Yes, people with higher incomes are, broadly speaking, happier than those who struggle to get by. But dig a little deeper into the findings, and they get a lot more surprising—and a lot more useful.”
What was found from the research is that happiness isn’t solely dependent on income, but what matter a lot more than how big your paycheck is, is how you spend it. “For instance, giving money away makes people a lot happier than lavishing it on themselves. And when they do spend money on themselves, people are a lot happier when they use it for experiences like travel than for material goods.”
It’s important to mention, research tells us that money only brings us happiness up to a certain point. “The bottom line: When you don’t have much money, a little extra can go a long way, because you have more essential needs to fulfill. As you accumulate more wealth, however, it becomes more difficult to keep “buying” more happiness.”
What do you think? Do you think money makes us happier? Or can it make us even less happy?