Is it more important to be rich or to be happy?

Sometimes we in the United States forget how privileged we are. Because of our relative wealth, we can make claims like “it's more important to be happy than it is to be rich”. In this guest post, Saravanan P of Engineer's Finance argues that for the poor, money is more important than happiness. Though this post has been heavily edited, keep in mind that English is not Saravanan's native language.

Being happy is a state of mind and heart that does not matter whether we are rich or poor. But we can only make statements like “It's more important to be happy than it is to be rich” when we are rich and not poor. Being rich always gives us the power to do things at the time we want. In short, it gives us freedom.

Sometimes I think I know just what it means to have money more than Americans do. I have seen people here in India struggle to earn two to three dollars a day working for more than 12 hours. It's hard, but still people do it. If we were to ask these people whether they are happy, they would say they are, but are they really? They assume they're happy and move on with the life. For them happiness is merely having their bread and butter.

If you are poor, you yearn for food and nothing else — money matters more than happiness because without the minimum of money, you don't eat. After you are rich, you tend to say that happiness is more important because your basics are already met. In fact, perhaps most rich people cannot even imagine a life in which the basics may be out of reach on any given day.

Many people argue that being rich is not as important as being happy. I just have two questions for people who say this:

  • When you are in hunger, can you think of being happy?
  • When you can't keep yourself warm during winter, can you think of being happy?

Until you satisfy your basic needs, you can't think of happiness. Forget about being happy. Once your basic necessities are met and you start living (not surviving), only then does happiness surface.

When you are struggling financially, you don't worry whether you're happy or sad. All that matters is financial security. Once you lose the financial security, you can't be happy as a normal human being whose needs are met. Because of this, I feel that being rich is more important than being happy.

So why then do people say “It's more important to be happy than it is to be rich”? I believe we struggle hard to make ourselves rich. The path is difficult. We work hard and maybe we eventually do become rich. All this while we don't give money the extra importance. We value our selves more than money.

After becoming rich, we value money more than our selves. We keep thinking only about money: how to save it, what to do with it. This all relates to money and not to our selves. We feel stressed out and begin to think of being happy again, that happiness we had when we were not rich.

The truth is: we are giving more importance to money than our selves, which causes pressure and makes us unhappy. Whether you or rich or poor, try not to give money too much importance. Then you can be happy no matter what.

Saravanan touches on some interesting topics here, including the notion of relative happiness. And what exactly does it mean to be “rich” anyhow? I'm reminded of studies that I've seen that demonstrate the very rich and the very poor are both unhappy, but that everybody else in between shares a similar level of happiness, regardless of financial circumstances. Photo by Rita Banerji.

More about...Psychology

Become A Money Boss And Join 15,000 Others

Subscribe to the GRS Insider (FREE) and we’ll give you a copy of the Money Boss Manifesto (also FREE)

Yes! Sign up and get your free gift
Become A Money Boss And Join 15,000 Others
guest
54 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Solomon
Solomon
11 years ago

I think there comes a point of diminishing returns. When you reach a certain point, more money doesn’t contribute to your happiness.

“People with ten million dollars are no happier than people with nine million.”

andrew
andrew
11 years ago

Money doesn’t buy happiness, but it certainly can buy comfort, which is a great starting off point.

Artsiom
Artsiom
11 years ago

>>When you are in hunger, can you think of being happy?

Only rich people not hungry?

The main question is what is ENOUGH to be not hungry and be happy. I don’t think Bill Gates is the happiest man on the planet.

J.D.
J.D.
11 years ago

Here are my own thoughts on this subject… While those in extreme poverty do not have choice between wealth and happiness, there are others who do have make this choice. Some people are able to do what they love and still earn money. (I’m one of those lucky few.) Others are able to pursue happiness without regards to money. But for others, this is a real choice. In order to obtain wealth and provide for possible future happiness, they give up happiness in the short term. Finding a balance between the present and the future is vital, I think. In… Read more »

jerry
jerry
11 years ago

usually that question comes from someone with money…

I’ll take money any day, you can always rent happiness.

ericabiz
ericabiz
11 years ago

What this article is referring to (probably without realizing it) is Maslow’s hierarchy of needs: http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs From the Wikipedia page: Physiological needs These are the basic human needs for such things as food, warmth, water, and other bodily needs. If a person is hungry or thirsty or their body is chemically unbalanced, all of their energies turn toward remedying these deficiencies and other needs remain inactive. Maslow explains that, “Anyone who attempts to make an emergency picture into a typical one and who will measure all of man’s goals and desires by his[her] behavior during extreme physiological deprivation, is certainly… Read more »

Rob in Denver
Rob in Denver
11 years ago

Why is this question almost always couched as an either/or proposition? I prefer it as and/both. It seems to me the first concedes too much.

Frugal Bachelor
Frugal Bachelor
11 years ago

I like what Tim Ferriss wrote in The 4-Hour Workweek: “Happiness can be purchased for the price of a bottle of wine” (I’m paraphrasing). He contended that achieving happiness is no longer a problem but really what people want is to avoid boredom.

Sara at On Simplicity
Sara at On Simplicity
11 years ago

Regardless of your answer, it’s a wonderful question to ask yourself from time to time. If you’re reading the article at all, it’s probably a given that your basic needs are met, so it’s simply a cogent reminder to question the value of money in your life. As for me, I feel like a doorknob for whining about not having anything good to eat for breakfast this morning. I know I don’t need to beat myself up over this, but it’s nice to put it in a larger context: I’m fortunate to have that problem at all.

Brandon
Brandon
11 years ago

Read Matthew 4. The Word of God touches on these very subjects. Our joy should not be in our money nor should it be in our food. A life without God will always be joyless. I’m not going to claim to understand what it is like to be without the basics. Yes, I grew up a poor American, but I’m also well aware that a poor American often has a better life than kings of long ago. I also am not going to pretend like I know what it’s like to be monetarily rich, because I am not and have… Read more »

J.D.
J.D.
11 years ago

I deliberated a long time before approving Brandon’s comment (#10). As you know, GRS generally steers clear of religion and politics. I disagree with Brandon completely. “A life without God will always be joyless”? This is demonstrably false.

However, his viewpoint is representative of many GRS readers, so I approved the comment.

I am not interested in turning this thread into a religious debate. If things wander too far afield or if a flame-war begins, I’ll simply nuke the comments.

I don’t think that’ll be necessary, though. You guys almost always keep your wits about you.

Nick Stewart
Nick Stewart
11 years ago

“A table, a chair, a bowl of fruit and a violin; what else does a man need to be happy?” By Albert Einstein See http://www.myfamousquotes.com/?aid=3269 Why are happiness and money seen as mutually exclusive things? There many poor and miserable people; there are many rich and happy folks. The important thing here is to find balance in our lives. Once you have your basic needs met (e.g. food, shelter, etc.) you need to find balance in the things you choose to do. Personally my goal is to be able to earn $10,000 a month from my web business. Once I… Read more »

Sharon
Sharon
11 years ago

For me, as long as my familiy’s basic needs are met, food, shelter, clothing (and I do know we’re rich by world’s standards, not necessarily U.S.)…I’ll take happiness any day over a dollar. I know this is highly personal and very subjective to me, but I went through a massive depression and was at times suicidal. After going through that and surviving, nothing matters so much to me. Yeah, we save for retirement and I don’t go on spending sprees to make myself feel good, but all in perspective, happiness, happiness, happiness….I won’t ever put money first. Thanks, very interesting… Read more »

Maabsta
Maabsta
11 years ago

That Jesus comment took away all your credibility…

Dan Isaacs
Dan Isaacs
11 years ago

“Read Matthew 4. The Word of God touches on these very subjects. Our joy should not be in our money nor should it be in our food. A life without God will always be joyless.”

Bullpuckey. I’m as Godless as Mao himself. And I am full of Joy. Your superstition is not the root of Joy.

On topic, having food to eat, air to breathe and a place to sleep…these are prerequisites for Happiness. Beyond that, happiness and wealth are infrequent competitors.

Aura
Aura
11 years ago

I agree with Saravanan… At my current point in life, I am more worried about having a place to live, a job, and enough money for food. The question of choosing between happiness and money doesn’t really come up. I need money before I can even think about happiness. The question for me is: when can I consider myself financially secure?

Jonathan
Jonathan
11 years ago

I think this posts brings up a lot of good points and at the risk of sounding overly academic; this reminds me a lot of Maslow’s Hierarchy of Needs (where you need to satisfy basic physiological needs before you can start to satisfy higher level psychological needs).

Saravanan
Saravanan
11 years ago

Hi JD,

Thank you so much for posting my article. I am so happy. This is the first thing I saw in the morning and you don’t know how happy I am. I appreciate your patience and the editing of my article.

Great Job. Thanks once again. 🙂

Saravanan

Sam
Sam
11 years ago

Living in a third world country (Philippines) I kinda agree with Saravanan’s post. You can never be happy unless the very basic needs are met.

Esa
Esa
11 years ago

Great Article!
I think this is a question we as individuals in “wealthy” nations should continuously be asking.
It may really help to stop from time to time and make a course correction if we have to.

Bart
Bart
11 years ago

I feel that this article doesn’t really say which one is more important. It couldn’t, because you cannot really compare money and happiness.
What is says is: you need a at least certain amount to be happy.
So if you do want to put a value to them, happiness is more important yet requires money.

Icegirl
Icegirl
11 years ago

I wonder if there would ever be a formula for calculating how much one should earn/acquire/save/amass to be ‘happy’ (before, for example, one takes that cruise holiday to the Bahamas!)

It would be interesting to see what that break-even point would be! $5,999 per month? $880,373 per year? Taking inflationary pressures and the threat of a world war into account of course!

Just a thought…

Santosh
Santosh
11 years ago

I think both “rich” and “happy” are relative terms and mean different things to different people.

I consider myself rich when I am debt-free (including mortgage) with 2 year’s worth of living expenses in easily accessible formats and a skill set that has good market value (software engineer for example). I say 2 year’s instead of 3 or 6 months because when you are debt free the living expenses go way down.

I consider myself to be happy when I see my family (including me) in good health.

amed
amed
11 years ago

money makes happiness easier to purse because you have the power to make it happen. being poor makes it harder to find that power that brings you happniess

rob
rob
11 years ago

Rich is important because it gives you the resources to help other people, which indirectly makes them happy, and this in turn makes you happy.

Happy is important because it puts you in the state wherein you can become rich. Through the process of getting in the ‘flow’, enjoying a close community of kinship with family and friends, being accepting of ourselves and developing gratitude for everything we encounter, we get in the flow of happiness. And this flow in turn leads to rich.

Dru Pagliassotti
Dru Pagliassotti
11 years ago

This post is a reminder of why practitioners of voluntary simplicity stress the “voluntary” part of the equation. To be able to choose to save money, reduce possessions, and focus on happiness rather than income is the privilege of people who have already met their basic physiological and safety needs. Living in want is neither voluntary nor simple….

allen
allen
11 years ago

@Erica: You beat me to it!

It is very simple: You can’t afford the time/energy/effort to be “happy” if you can’t eat/be warm/sleep safe.

Still, heavy things to contemplate, from my fat american seat. Just how much at each level do i need, before i can go on to worry about the next? I must be careful not to be caught up with the needs of each given level, else it prevents me from moving on to the next.

March Hare
March Hare
11 years ago

“Until you satisfy your basic needs, you can’t think of happiness…. Once you lose the financial security, you can’t be happy as a normal human being whose needs are met. Because of this, I feel that being rich is more important than being happy.” The saying is, “It is better to be happy than to be rich.” Since when does “satisfy[ing] your basic needs” = “rich”? Seems to me that “rich” would be above and beyond meeting your basic needs. It seems to me that the author is confusing these terms. After a certain point, chasing after money doesn’t mean… Read more »

Moneymonk
Moneymonk
11 years ago

When I was making $40K a year my needs were met. When I starting making beyond that, my happiness has not changed. But I do have more toys and a different standard of living.

As you said once your needs are met, you begin living, so everything else is pretty much keeping score

TosaJen
TosaJen
11 years ago

From my experience: Money != happiness. However, lack of money can lead to misery, and making money the center of life can lead to misery. It’s not news that extremes usually lead to misery of some kind. Balance is good. Money = buffer to make risky choices and relief from day-to-day financial worries. For me, financial security helps with happiness because I don’t have to worry excessively about core needs (food, shelter, clothing). I also don’t need to worry about most risks outside my control (abrupt job loss, loss of property, illness, etc.). We have enough money and insurance to… Read more »

Odd Lot
Odd Lot
11 years ago

Hey all, I read a great post on a forum a few years ago and since nothing on the net ever disappears, I was able to dig it up. Someone asked the same question, “wealth or happiness”? It was an anti-establishment discussion on a very liberal forum so there were a lot of money-haters. Many of the people posting seemed to agree that “money is the root of all evil” which I find absurd. My favorite response was the following… “HaHaHa…Money and happiness, the age old question. I live a life of poverty, of fairly deep poverty, in regards to,… Read more »

pundigga
pundigga
11 years ago

Three dollars a day is enough to get your basic needs met in India. I think the author is wrong in this regard and should differentiate between the cost of living in India vs the US. Also, Indian society doesn’t place a heavy emphasis on material wealth (except for maybe textiles). I think it is much easier for an Indian person to attain happiness than someone in the United States. But now India is following the route of the US. As the wealth increases, there will be a pursuit of material goods which could ultimately make Indian society less happy… Read more »

Mike Bahr
Mike Bahr
11 years ago

“People who say money can’t buy happiness don’t f__king have any.” – Jim Young, “Boiler Room” That said, I think a core principle here at GRS and at related sites like Unclutterer is that there’s a significant correlation between happiness and wealth as a person builds toward financial stability, but then there comes a point after which further wealth is diminishing returns. It’s entirely possible to be happy knowing that you have “ENOUGH.” For my part, ever since J.D. opened on his mantra of “Stop Buying Junk,” I have found myself happier and happier the more I sell off my… Read more »

Charlotte
Charlotte
11 years ago

Maabsta – JD posting the religious comment does not make him lose his credibility. It shows that he welcomes readers from all walks of life and does not discriminate. Brandon – I love your comment. Amen. JD, keep up the good work. To All: I believe that happiness is defined by the individual. I have seen more happy people in third world countries than in the USA. That is because it does not take much to be happy. I grew up in a third world country. What made me happy was all my friendships, family and experiences such as travel.… Read more »

AJ
AJ
11 years ago

This article misses the point of the happy/rich debate. In any argument you can take extreme sides of the spectrum and this is done here. Try this, http://www.time.com/time/world/article/0,8599,1822787,00.html?xid=feed-yahoo-world It is not true that extreme poverty does not exist in this country. You don’t have to “leave the U.S.” to find that. People who are in such a horrible situation they have no choices financially. This article also plays on stereotypes about people outside the West and in the third world which are false. As far as hunger and need. My father grew up a migrant laborer and spent many nights… Read more »

Bill
Bill
11 years ago

I bet if you turn off the TV you’ll feel a lot happier.

Marketing/advertising is designed to create desires to buy, buy, buy, to be happy.

I know, because I helped create that desire in a past, well-paying, but souless job.

Once you stop comparing yourself to an actor on the screen you probably won’t have the desire to waste your life doing anything as sad and pointless as camping out for a new iPhone.

Icegirl
Icegirl
11 years ago

What about Cosmopolitan then? 😉

DC Portland
DC Portland
11 years ago

It’s wonderful to see so much interest in this subject! It fills me with confidence having left a lucrative financial management career to become an educator in happiness/well-being, work/life balance,over-consumption, and voluntary simplicity. Though it seems trite, Bill is correct. Disconnecting from the “advertising machine” is critical not only to your happiness, but also your financial health. It’s a tragedy that the “new consumers” in the developing world are basing their sense of self-worth on what they see presented on television and the internet (i.e. the western world’s glamorization of over-consumption). We have much to learn from those who went… Read more »

Abbott
Abbott
11 years ago

Money has to buy me happiness — I’m on a pricey little cocktail of meds for severe, crippling depression. They cost as much as my rent without patient/indigent assistance programs.

Saravanan provides an easily overlooked but essential perspective here. And with the rising price of food and energy, I think more people will appreciate what he’s saying more, to whatever extent.

Be grateful for what you have.

Abbott
Abbott
11 years ago

I just read “Why We Buy” (a fine little book, by the way), and he describes how he cried in the supermarket when he realized he could buy anything there, if he wanted to. That’s basically my financial goal, and where money, in my mind, equals happiness.

Sandy Naidu
Sandy Naidu
11 years ago

When you are struggling to finance your basic needs, money matters more than anything else…This whole question of ‘does money buy you happiness’ is only applicable for people who have some money…

marian
marian
11 years ago

As a Christian, I was very dismayed by Brandon’s response. While I do believe that Jesus came to save the world and that spirituality is essential to happiness I think the narrowness of Brandon’s post is just a turn-off. What I mean is that Buddhists, Jews, Hindus, animists and atheists etc. can all be happy if they have a faith that there is something greater and more important than what is merely material. Atheists often put their faith in human progress and morality and while I may not entirely share their views I know many atheists are entirely material-oriented and… Read more »

marian
marian
11 years ago

In my earlier post, I omitted an important word. I meant to say that i do know that many eithers are NOT entirely materially oriented. My intention was to point out that many athiests are very concerned with human well being – not just material goods.

deepali
deepali
11 years ago

rich:happy::apples:oranges. Perhaps? Empirically speaking, your happiness goes up sharply as you move towards the point at which you can satisfy your basic needs. After that, it starts to level off (or possibly even go down). In my mind, that says that happiness has nothing to do with money and everything to do with (basic, universal) survival.

Great post!

Phillip
Phillip
11 years ago

Interesting post Yes you need to fullfill your basic needs, and happiness it is not about how rich you’re but how you feel with your life, family, country. This reminds me of the measure of happiness in the world per country. Obviously, people feel happier when they cover the basic needs, but amazingly people in some rich countries are in the list under some countries considered as less developed: Maybe countries where you fullfill the needs but you have a richest life, a net of friends, family, ect. Here is a link; interesting. I will save to visit the first… Read more »

Madhavi
Madhavi
11 years ago

Great post.

I think ‘Happiness’ is the consequence of hardly(and smartly)earned money and more importantly of spending it wisely.

For the perfect guidance on personal finance management one can rely on MoneyLIFE, a fortnightly personal finance magazine anytime.

This magazine is sharply focused on stocks, mutual funds, careers, consumer rights plus enterprise & smart spending.

http://www.moneylife.in

James - Forex Articles
James - Forex Articles
11 years ago

You can definitely be happy without being rich because having your friends and family around you is a wonderful thing.

However you can have all that and have money as well which gives you more options and enables you to support your family and make them happy as well.

Matt
Matt
11 years ago

Happiness is about self-fulfillment. it’s about doing whatever gives you that. We all know money doesn’t make you happy but it can enable you to become self fulfilled.

I recentlly started a web forum about the ‘deeds’ that i try to do an a daily basis to help with my self fulfillment. http://www.adailydeed.com is about doing things to others to enable that self-fulfillment. Please do not take this a a shameless advert because i do firmly believe that in helpling others you will become fulfilled and that fulfillment WILL help you become wealthy.

Catherine Frye
Catherine Frye
11 years ago

Yes, I agree that being rich can bring one freedom. But true happiness comes from with-in ones self whether if you are rich or poor.
Fulfilling ones basic needs will also bring about happiness because one don’t have to worry just about trying to survive.

Ditto
Ditto
11 years ago

Most people are about as happy as they make up their minds to be-Abraham Lincoln
Happiness is an inside job. Yes the basics needs have to be met. What matters most about success is how it is attained.

shares