MONEY CAN BUY YOU HAPPINESS

If you spend it right, that is. In his new book, The Art of Spending Money, Morgan Housel looks at the perks and pitfalls of how we manage our finances.

- By Liesl Robertson

Confused by spreadsheets, investment jargon and finance bros droning on about crypto? Same.

Which is why Morgan Housel is such an accessible writer: Mostly, he tells stories to get his point across.

'This book is about how spending money has little to do with numbers and spreadsheets, and a lot to do with psychology, envy, identity, social aspirations, insecurity and other topics that are too often ignored in finance,' writes Housel. Money can make you happy, he says. And spending it can also bring you joy. 'But it’s more complicated than many people think. In between the numbers, charts and data sit the messiness and absurdity of the human mind.’

There’s the young broke guy who goes further into debt buying a car he can’t afford, thinking it will impress his friends. There’s the pensioner who’s been saving diligently for decades, and now can’t seem to get out of that ‘saver’ mindset and spend any of their hard-earned money. There’s the couple who were over the moon because they finally saved enough for an apartment of their own – and then their friends moved into a much swankier house. There’s the investment banker spending money on art he doesn’t even like because ‘that’s what you’re supposed to do’ when you are earning well.

The way someone spends their money tells you a lot about them. But here’s the key question underneath it all: Do you use money as a tool to have a better life, or as a yardstick of success?

BUYING HAPPINESS

Can money buy happiness? Sure it can. People living in poverty are obviously less satisfied with their lives than those who have enough to comfortably cover their living expenses. But a fat bank balance is not a miracle cure-all. Research by Matthew Killingsworth from the University of Pennsylvania revealed that people with low levels of emotional wellbeing did not become happier when their income rose.