Summertime is often the season that invokes many memories and stories because of the adventures we take. Whether it’s camping, hiking, neighborhood picnics, bike rides, swimming, going to camp, taking a road trip to see family, friends, and historical places, these experiences can stay with us for a long time and offer a fulfillment that a new pair of shoes cannot. When NWEI staffer Liz Zavodsky saw the latest article from Fast Company Exist on the science behind why we should spend money on experiences and not things, she was reminded of her own experiences that have led to great memories, funny stories, and valuable learning moments. For the full article, click here.
Most people are in the pursuit of happiness. There are economists who think happiness is the best indicator of the health of a society. We know that money can make you happier, though after your basic needs are met, it doesn’t make you that much happier…”One of the enemies of happiness is adaptation,” says Dr. Thomas Gilovich, a psychology professor at Cornell University who has been studying the question of money and happiness for over two decades. “We buy things to make us happy, and we succeed. But only for a while. New things are exciting to us at first, but then we adapt to them.” So rather than buying the latest iPhone or a new BMW, Gilovich suggests you’ll get more happiness spending money on experiences like going to art exhibits, doing outdoor activities, learning a new skill, or traveling.
Gilovich’s findings are the synthesis of psychological studies conducted by him and others into the Easterlin paradox, which found that money buys happiness, but only up to a point. How adaptation affects happiness, for instance, was measured in a study that asked people to self-report their happiness with major material and experiential purchases. Initially, their happiness with those purchases was ranked about the same. But over time, people’s satisfaction with the things they bought went down, whereas their satisfaction with experiences they spent money on went up…While the happiness from material purchases diminishes over time, experiences become an ingrained part of our identity…”We consume experiences directly with other people,” says Gilovich. “And after they’re gone, they’re part of the stories that we tell to one another.”…
Gilovich’s research has implications for individuals who want to maximize their happiness return on their financial investments, for employers who want to have a happier workforce, and policy-makers who want to have a happy citizenry. “By shifting the investments that societies make and the policies they pursue, they can steer large populations to the kinds of experiential pursuits that promote greater happiness,” write Gilovich and his coauthor, Amit Kumar, in their recent article in the academic journal Experimental Social Psychology. If society takes their research to heart, it should mean not only a shift in how individuals spend their discretionary income, but also place an emphasis on employers giving paid vacation and governments taking care of recreational spaces. “As a society, shouldn’t we be making experiences easier for people to have?” asks Gilovich.