We live in a consumer-based culture with companies constantly encouraging us to buy cars, clothes, gadgets, and everything else imaginable. The suggestion is that the more we buy, the better we will feel. But age-old wisdom tells us that money can’t buy you happiness. So which is it? Will a bigger bank account give us a better life?
According to Joe Dominguez and Vicki Robin, authors of Your Money or Your Life, the answers is yes and no, but mostly no. Their research found that spending more can lead to personal fulfillment up to a point but that spending too much has a negative impact on your life.
The relationship between the money you spend and your state of fulfillment is represented in a graph called the Fulfillment Curve. The first part of the curve represents survival, where a little money spent on basic needs like food, shelter, and clothing brings large gains in happiness.
With basic needs met, the next point on the curve indicates comforts such as a couch to sit on or a second pair of shoes or pants. Acquiring comforts makes you happy, but not as happy as when you are meeting basic needs.
Once you can buy a full wardrobe, a bigger place to live, or a new car you are dealing with luxuries and you are at the peak of your fulfillment curve. If you already have 15 pairs of shoes, buying one more pair doesn’t make you that much happier. In terms of fulfillment, there is nowhere to go but down.
The final part of the curve is overconsumption, where you are buying beyond the limits of common sense – getting hundreds of pairs of shoes, or a mansion with more space than you can use. At this point, your stuff can become a burden and spending an addiction. Far from buying happiness, you can spend your way into misery according to Dominguez and Robin.