Skip to main content
Part of complete coverage on

How to buy happiness

By Michael Norton and Elizabeth Dunn, Special to CNN
July 1, 2012 -- Updated 1326 GMT (2126 HKT)
STORY HIGHLIGHTS
  • Authors: People fantasize about going on a buying spree if they win lottery
  • The reality is that buying more stuff doesn't maximize happiness
  • Their research shows that giving things to others is more likely to make us happy

Editor's note: Michael Norton is an associate professor at Harvard Business School. Elizabeth Dunn is a professor at the University of British Columbia. They are co-authors of the forthcoming book, "Happy Money: The Science of Spending" (Simon & Schuster). Norton spoke at TEDxCambridge. TED is a nonprofit organization dedicated to "Ideas worth spreading," which it makes available through talks posted on its website.

(CNN) -- What would you do if the world handed you a million dollars right now? Maybe you received an inheritance, maybe you won the lottery, maybe you found a briefcase by the side of the road filled with unmarked bills.

Our guess is that many of the first things that come to mind involve driving to a store, or going online, and buying stuff. And not just some stuff -- a lot of stuff. Very expensive stuff. As soon as we start thinking about money, we can't help but start thinking about all the lovely things we'd buy for ourselves with the money.

There's nothing wrong with buying things for yourself. The problem is that there isn't much right with doing this, either. Many of the major purchases that we make -- like fancy cars and big houses -- don't really make us much happier. When you use your money to buy stuff for yourself, you're leaving happiness on the table.

Michael Norton
Michael Norton
Elizabeth Dunn
Elizabeth Dunn

But there's a solution: Give it away. Perhaps when you thought about what you'd do with a million bucks, a tiny voice in the back of your head meekly said, "And I'd give some to charity" -- before being drowned out by a cacophony of desires to refurnish your house and reinvigorate your wardrobe.

TED.com: The antidote to apathy

Our research conducted over the last decade suggests that you should listen more closely, and more often, to that little voice. Why? Because giving your money to others instead of spending it on yourself provides a bigger happiness bang for your buck.

In one experiment, we gave people $5 in the morning and told them to spend it by that evening -- either on something for themselves, or something for someone else.

When we called them that evening, those who spent on themselves were just as happy as they were before getting the cash.

Those who spent it on others? They bought presents for family members, or gave money to the homeless -- and were happier than those who spent on themselves. We see this pattern time and time again, nearly everywhere we've looked in the world, in countries ranging from Canada to Uganda to India to South Africa: Spending money on other people is linked to happiness.

TED.com: 7 rules for making more happiness

It doesn't take a lot of giving to get a lot of happiness. The benefits of giving can be had for mere dollars a day. So although we can't all take Warren Buffett's "millionaire's pledge" -- where the richest of the rich pledge to give away at least 50% of their wealth -- we can commit to giving more to others than we do now.

Is there anything in your everyday life that costs $5 that you might be able to sacrifice just once a week? You might be holding a cup of it in your hand right now: coffee.

Next time you're craving that caffeine fix, think about subbing in the needs of another person for your mocha cookie-crumble frappuccino. You'll miss the coffee a little bit, sure -- but the payoffs for your overall happiness make it worth it.

Follow @CNNOpinion on Twitter.

Join us at Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of the authors.

ADVERTISEMENT
Part of complete coverage on
April 18, 2014 -- Updated 2047 GMT (0447 HKT)
Jim Bell says NASA's latest discovery support the notion that habitable worlds are probably common in the galaxy.
April 18, 2014 -- Updated 1817 GMT (0217 HKT)
Jay Parini says even the Gospels skip the actual Resurrection and are sketchy on the appearances that followed.
April 18, 2014 -- Updated 1752 GMT (0152 HKT)
Graham Allison says if an unchecked and emboldened Russia foments conflict in a nation like Latvia, a NATO member, the West would have to defend it.
April 18, 2014 -- Updated 1311 GMT (2111 HKT)
John Sutter: Bad news, guys -- the pangolin we adopted is missing.
April 19, 2014 -- Updated 1710 GMT (0110 HKT)
Ben Wildavsky says we need a better way to determine whether colleges are turning out graduates with superior education and abilities.
April 18, 2014 -- Updated 1026 GMT (1826 HKT)
Charles Maclin, program manager working on the search and recovery of Malaysia Flight 370, explains how it works.
April 18, 2014 -- Updated 1250 GMT (2050 HKT)
Jill Koyama says Michael Bloomberg is right to tackle gun violence, but we need to go beyond piecemeal state legislation.
April 17, 2014 -- Updated 1845 GMT (0245 HKT)
Michael Bloomberg and Shannon Watts say Americans are ready for sensible gun laws, but politicians are cowed by the NRA. Everytown for Gun Safety will prove the NRA is not that powerful.
April 17, 2014 -- Updated 1328 GMT (2128 HKT)
Ruben Navarrette says Steve Israel is right: Some Republicans encourage anti-Latino prejudice. But that kind of bias is not limited to the GOP.
April 16, 2014 -- Updated 2323 GMT (0723 HKT)
Peggy Drexler counts the ways Phyllis Schlafly's argument that lower pay for women helps them nab a husband is ridiculous.
April 16, 2014 -- Updated 1642 GMT (0042 HKT)
Rick McGahey says Rep. Paul Ryan is signaling his presidential ambitions by appealing to hard core Republican values
April 16, 2014 -- Updated 1539 GMT (2339 HKT)
Paul Saffo says current Google Glasses are doomed to become eBay collectibles, but they are only the leading edge of a surge in wearable tech that will change our lives
April 15, 2014 -- Updated 1849 GMT (0249 HKT)
Kathleen Blee says the KKK and white power or neo-Nazi groups give haters the purpose and urgency to use violence.
April 16, 2014 -- Updated 1156 GMT (1956 HKT)
Sen. Sheldon Whitehouse and Rep. Henry Waxman say read deep, and you'll see the federal Keystone pipeline report spells out the pipeline is bad news
April 16, 2014 -- Updated 1153 GMT (1953 HKT)
Frida Ghitis says President Obama needs to stop making empty threats against Russia and consider other options
ADVERTISEMENT