1 00:00:01,230 --> 00:00:03,396 I'm Michael Norton. I'm an associate professor at Harvard 2 00:00:03,396 --> 00:00:06,265 Business School. And a lot of my research looks at the 3 00:00:06,265 --> 00:00:10,110 relationships between money, time, and happiness. 4 00:00:10,110 --> 00:00:12,340 And the reason those three things are interesting to me. 5 00:00:12,340 --> 00:00:15,564 And interesting at the same time, to study them is because, we spend so much 6 00:00:15,564 --> 00:00:19,990 of our mental energy thinking about. How to be happy and if we're happy 7 00:00:19,990 --> 00:00:22,790 enough, and I'm not happy today and I felt happier last week, or this 8 00:00:22,790 --> 00:00:25,940 relationship made me happy and this one made me unhappy, or should I get a new 9 00:00:25,940 --> 00:00:31,272 job, or should I talk to my parents more. But we don't know a lot about how to make 10 00:00:31,272 --> 00:00:33,886 ourselves happy. We have some theories about it, but we're 11 00:00:33,886 --> 00:00:37,71 not really that good always at figuring out what the best way is to feel happier 12 00:00:37,71 --> 00:00:41,892 today and tomorrow and next year. And one of the key resources we have for 13 00:00:41,892 --> 00:00:47,20 making ourselves happier is our money and another key resource is our time. 14 00:00:47,20 --> 00:00:50,269 So these are the two things that we have some of and we can spend them in 15 00:00:50,269 --> 00:00:53,535 different ways. And our research looks at what are the 16 00:00:53,535 --> 00:00:57,400 best ways to spend those two things. To spend your money and to spend your 17 00:00:57,400 --> 00:01:01,920 time, to make yourself a happier person. And the problem with both of those is 18 00:01:01,920 --> 00:01:06,350 we're not good at knowing how to spend them and they mess us up along the way. 19 00:01:06,350 --> 00:01:10,280 And we become less happy instead of more happy when we use these resources. 20 00:01:10,280 --> 00:01:13,600 So, let's start with money. So, there's a lot of problems with money. 21 00:01:13,600 --> 00:01:16,406 The first one is we think that money is going to make us a lot happier than it 22 00:01:16,406 --> 00:01:19,676 actually does. So, it turns out that when you make some 23 00:01:19,676 --> 00:01:22,962 income you do get a little happier if you go from being poor to sort of middle 24 00:01:22,962 --> 00:01:27,520 class But after that it actually really starts to taper off. 25 00:01:27,520 --> 00:01:30,820 So it's not that more money is bad for you, it just doesn't keep making you 26 00:01:30,820 --> 00:01:35,23 happier in the way you want it to. And yet we keep trying to make more and 27 00:01:35,23 --> 00:01:37,310 more of it. We keep trying to get a better job and 28 00:01:37,310 --> 00:01:40,123 make more money. And we're just wrong in terms of how 29 00:01:40,123 --> 00:01:43,772 happy it's, it's really going to make us. And the other problem with money is 30 00:01:43,772 --> 00:01:46,892 separate from this problem, which is just it wears off, is that money actually 31 00:01:46,892 --> 00:01:50,600 makes us really selfish. So when we get money, the first thing 32 00:01:50,600 --> 00:01:54,0 that we think is, what can I do for myself with this money? 33 00:01:54,0 --> 00:01:56,10 So if you thought about if you won the lottery today. 34 00:01:56,10 --> 00:01:58,680 And I said, what do you want to buy with the money you won? 35 00:01:58,680 --> 00:02:01,752 I bet the first think you would think is, what kind of a house, and what kind of a 36 00:02:01,752 --> 00:02:05,260 car, and what kind of a everything can I get for me. 37 00:02:05,260 --> 00:02:08,662 And that means, that you're sort of using your money for things that are self 38 00:02:08,662 --> 00:02:12,305 focused and inwardly focused. And we know that that doesn't necessarily 39 00:02:12,305 --> 00:02:14,240 make us happy. We don't know a lot of really, really 40 00:02:14,240 --> 00:02:16,676 selfish people. If you think in your everyday life, who 41 00:02:16,676 --> 00:02:20,948 are really kind of happy rosy people. Usually, they tend to be quite sad and 42 00:02:20,948 --> 00:02:23,498 unhappy. Our question really was with, how do we 43 00:02:23,498 --> 00:02:27,556 switch people's attitudes with money? We've got this problem, where money is 44 00:02:27,556 --> 00:02:30,337 wearing off. We've got this other problem where 45 00:02:30,337 --> 00:02:33,623 money's making you selfish and only caring about your own possessions and 46 00:02:33,623 --> 00:02:37,42 your own life. We said, is there a way to make this 47 00:02:37,42 --> 00:02:40,500 curve keep going up. So can we make money keep making you 48 00:02:40,500 --> 00:02:43,860 happy by making you not use it all on yourself. 49 00:02:43,860 --> 00:02:47,435 That maybe the problem is that we have this curve, because we become so selfish 50 00:02:47,435 --> 00:02:51,124 when we get wealthy. And if we instead encourage people to use 51 00:02:51,124 --> 00:02:54,110 the money on anybody else than themselves. 52 00:02:54,110 --> 00:02:57,527 That might be a source of real happiness for people and that might make money keep 53 00:02:57,527 --> 00:03:00,844 making you happy. So the very first way that we tested this 54 00:03:00,844 --> 00:03:03,724 was in a study that we ran in the University of British Columbia and we 55 00:03:03,724 --> 00:03:06,940 literally said, let's just give people money, let's just dole out cash to people 56 00:03:06,940 --> 00:03:09,724 and tell them how to spend it, and measure whether it made them happy or 57 00:03:09,724 --> 00:03:14,542 not. So we went on campus one morning and gave 58 00:03:14,542 --> 00:03:18,786 people envelopes, filled with money. And we said, will you be in our 59 00:03:18,786 --> 00:03:22,296 experiment and if they said yes we gave them an envelope it had some money in the 60 00:03:22,296 --> 00:03:25,752 envelope and there was a slip of paper that said to some people by 5:00 pm today 61 00:03:25,752 --> 00:03:31,171 spend this money on yourself. That's the way that we usually spend our 62 00:03:31,171 --> 00:03:34,700 money is on ourselves but to the other people we said by 5:00 p.m. 63 00:03:34,700 --> 00:03:38,240 Today spend this money on somebody else, like a gift for a friend, or, or a 64 00:03:38,240 --> 00:03:42,574 donation to a homeless person. Same amount of money, very tiny 65 00:03:42,574 --> 00:03:45,460 difference in what the slip of paper said. 66 00:03:45,460 --> 00:03:48,188 We called them back at the end of the day and asked them, what did you with the 67 00:03:48,188 --> 00:03:52,270 money, and we asked them, how happy are you, over the course of the day. 68 00:03:52,270 --> 00:03:55,130 And it turns out that people who spent money on themselves, it wasn't a bad day, 69 00:03:55,130 --> 00:03:57,770 we gave them $20 and they got to buy something, so they weren't less happy 70 00:03:57,770 --> 00:04:01,162 than they were. But they didn't get any happier, even 71 00:04:01,162 --> 00:04:04,530 though they got this free money. But the people who we said spend this 72 00:04:04,530 --> 00:04:07,730 money on somebody else, they actually got happier. 73 00:04:07,730 --> 00:04:10,160 So we asked them, what did you do? And they said, oh, I bought a stuffed 74 00:04:10,160 --> 00:04:12,830 animal for my niece, or I bought my friend a coffee. 75 00:04:12,830 --> 00:04:16,145 And those things actually led them to be much happier at the end of the day, then 76 00:04:16,145 --> 00:04:20,940 doing what they usually do, which is just using their money on themselves. 77 00:04:20,940 --> 00:04:24,22 Then we thought well that's interesting because that means there's some advice 78 00:04:24,22 --> 00:04:26,782 that you could do right now, today to make yourself happier which is quit 79 00:04:26,782 --> 00:04:29,726 spending all your money on yourself and take $5 out of your pocket and spend it 80 00:04:29,726 --> 00:04:34,919 on Salomone else or give it away. But we ran these studies in the United 81 00:04:34,919 --> 00:04:38,980 States and we ran them in Canada, and these are pretty wealthy countries. 82 00:04:38,980 --> 00:04:42,514 Maybe it's the case that if you have a lot of money, sure giving it away feels 83 00:04:42,514 --> 00:04:45,256 good. But would it be the case if you were 84 00:04:45,256 --> 00:04:48,770 quite poor in the United States? Or even if you lived in a very poor 85 00:04:48,770 --> 00:04:52,150 country like some Sub-Saharan African countries? 86 00:04:52,150 --> 00:04:55,318 Would we still see that even when you're poor and you need money for yourself, it 87 00:04:55,318 --> 00:04:58,800 still actually can make you happy if you give it away? 88 00:04:58,800 --> 00:05:01,714 So we set out to test that, so we've done these same kinds of studies, we give 89 00:05:01,714 --> 00:05:06,200 people money for themselves or we give them money and make them give it away. 90 00:05:06,200 --> 00:05:10,50 We've done these studies in South Africa, in Uganda in Canada, in India, all over 91 00:05:10,50 --> 00:05:13,960 the world where we've looked everywhere we've looked. 92 00:05:13,960 --> 00:05:16,110 It looks like, when people give money away. 93 00:05:16,110 --> 00:05:19,920 It's better for their happiness, than when they spend it on themselves. 94 00:05:19,920 --> 00:05:22,420 Even when we look at very, very poor countries. 95 00:05:22,420 --> 00:05:26,306 So there's this very basic relationship between money and happiness that we're 96 00:05:26,306 --> 00:05:30,300 getting entirely wrong. So this, these two problems of, it's 97 00:05:30,300 --> 00:05:34,110 wearing off over time And we spend it on ourselves. 98 00:05:34,110 --> 00:05:37,527 Little tiny shift in your behavior, just taking some of that money that you spend 99 00:05:37,527 --> 00:05:40,944 on yourself, people still will buy cars and houses and coffee for themselves and 100 00:05:40,944 --> 00:05:44,901 all those things. A tiny shift where you take that and 101 00:05:44,901 --> 00:05:48,86 spend it on someone else, literally something as small as buying someone else 102 00:05:48,86 --> 00:05:51,124 a coffee instead of yourself, changes this relationship a bit and gets you 103 00:05:51,124 --> 00:05:56,190 happier with your money. Now let's think about time, so we're 104 00:05:56,190 --> 00:05:58,520 clearly getting money wrong in some sense. 105 00:05:58,520 --> 00:06:00,930 What about time? That's the other thing we have. 106 00:06:00,930 --> 00:06:03,800 We get some everyday. Actually, we get 24 hours of it everyday, 107 00:06:03,800 --> 00:06:08,38 because there's only 24 hours in a day. But we can choose how to spend our time, 108 00:06:08,38 --> 00:06:11,174 not quite in the same way as spend our money, but still, it's a resource, we can 109 00:06:11,174 --> 00:06:14,212 do whatever we want with it, and we decide how to dole it out among different 110 00:06:14,212 --> 00:06:18,530 things we want to do. We're going to eat. 111 00:06:18,530 --> 00:06:21,40 We're going to sleep. We're probably going to watch TV. 112 00:06:21,40 --> 00:06:23,419 All of these things that we like to do, but we can do whatever we want with it 113 00:06:23,419 --> 00:06:26,310 really. And again, so remember with money people 114 00:06:26,310 --> 00:06:29,990 often spend it on themselves. And it's very about, what I want and what 115 00:06:29,990 --> 00:06:32,930 I need to do today. We find that people do the same thing 116 00:06:32,930 --> 00:06:37,940 with time that, that they really think they should use their time on themselves. 117 00:06:37,940 --> 00:06:39,990 Everyone reports being stressed about time. 118 00:06:39,990 --> 00:06:43,390 Everyone says this, this phrase a time famine. 119 00:06:43,390 --> 00:06:46,204 Literally, people feel as though they're starved for time and they, if they only 120 00:06:46,204 --> 00:06:49,680 had more time, they'd be happier. And the way that they try to deal with 121 00:06:49,680 --> 00:06:52,280 that feeling is to spend time on themselves. 122 00:06:52,280 --> 00:06:56,630 So they do things like get massages. Massages are great, we all love massages. 123 00:06:56,630 --> 00:07:00,800 But just like buying yourself a coffee Is nice but it doesn't make you happier. 124 00:07:00,800 --> 00:07:04,457 Getting yourself a massage is, is really, really nice but it doesn't really change 125 00:07:04,457 --> 00:07:07,510 your perception of your time all that much. 126 00:07:07,510 --> 00:07:10,910 You like the massage when it's done, you still feel stressed about everything you 127 00:07:10,910 --> 00:07:14,200 need to get done. And also just like with money, remember 128 00:07:14,200 --> 00:07:17,400 we said that giving money away makes you happier than, than spending it in 129 00:07:17,400 --> 00:07:21,150 yourself. It turns out that giving time away. 130 00:07:21,150 --> 00:07:24,513 Actually, makes you feel that you have more time, than spending time on 131 00:07:24,513 --> 00:07:27,257 yourself. The way that we do these studies to try 132 00:07:27,257 --> 00:07:31,343 to show this is imagine, again one day. I send you an email, and say, by 5 o' 133 00:07:31,343 --> 00:07:35,210 clock today, I want you to spend some time on yourself. 134 00:07:35,210 --> 00:07:38,210 And people do things like get massages and get a haircut, and all sorts of 135 00:07:38,210 --> 00:07:41,162 things. Other people, again we say, by 5pm today, 136 00:07:41,162 --> 00:07:45,342 spend some time on somebody else. Then we asked these people, how do you 137 00:07:45,342 --> 00:07:47,920 feel about your time? Are you stressed about your time? 138 00:07:47,920 --> 00:07:50,460 Do you still feel like you have a time famine? 139 00:07:50,460 --> 00:07:53,958 Turns out like with money again with time if you spend time on yourself you don't 140 00:07:53,958 --> 00:07:57,390 feel any, any more stressed about your time. 141 00:07:57,390 --> 00:08:00,563 But it doesn't do anything for you. You still feel just as stressed as you 142 00:08:00,563 --> 00:08:04,167 did before, but people who spend time on other people they help someone with their 143 00:08:04,167 --> 00:08:07,940 homework or they go volunteer at a soup kitchen. 144 00:08:07,940 --> 00:08:10,730 People do all kinds of things to help other people that actually makes them 145 00:08:10,730 --> 00:08:13,560 feel as though they have more time in their day. 146 00:08:13,560 --> 00:08:16,395 And at first glance it doesn't make a lot of sense so you'd think if, if I don't 147 00:08:16,395 --> 00:08:20,273 have enough time for myself. How can spending some of it on anybody 148 00:08:20,273 --> 00:08:23,780 else make me feel better, because then I'm even busier than I was before. 149 00:08:23,780 --> 00:08:27,260 But it turns out that when we give to other people, it signals to us that we 150 00:08:27,260 --> 00:08:32,241 have a lot of whatever we're giving away. So if I have enough money to dole out to 151 00:08:32,241 --> 00:08:36,430 people, or if I have enough time in my life, where I can give it away. 152 00:08:36,430 --> 00:08:40,84 It means that I actually must have a lot of time, and that signal to us makes us 153 00:08:40,84 --> 00:08:44,139 feel better about our time. And in fact, we can show that when people 154 00:08:44,139 --> 00:08:47,63 give time away, they actually become more willing to do more things in the future, 155 00:08:47,63 --> 00:08:49,815 because now they feel much better about the stress that they had, about their 156 00:08:49,815 --> 00:08:54,800 time. So money, happiness, and time. 157 00:08:54,800 --> 00:08:58,383 We all want to be very, very happy. And we have these two key resources that 158 00:08:58,383 --> 00:09:02,43 we can spend every day, and over the course of our lives, our money and our 159 00:09:02,43 --> 00:09:05,382 time. The way we usually spend them, not 160 00:09:05,382 --> 00:09:07,910 horrible. We're not totally wrong in what we do. 161 00:09:07,910 --> 00:09:11,260 But we're not spending them optimally, to make ourselves the happiest, which is 162 00:09:11,260 --> 00:09:15,330 our, one of our biggest goals in life is to be happy. 163 00:09:15,330 --> 00:09:18,410 What you can do instead, is any time you have some free time. 164 00:09:18,410 --> 00:09:22,30 And you're thinking, let me spend it on myself, give it away. 165 00:09:22,30 --> 00:09:24,820 Call a friend, help somebody, sign up to volunteer. 166 00:09:24,820 --> 00:09:29,10 Any of these activities that are other focused instead of all about yourself. 167 00:09:29,10 --> 00:09:31,220 Same thing with money, any time you get some money. 168 00:09:31,220 --> 00:09:34,196 And, many of us have enough money to at least give some money to charity, and 169 00:09:34,196 --> 00:09:37,540 things like that. Your impulse will be, oh, I have some 170 00:09:37,540 --> 00:09:41,499 money let me spend it on myself. Again, the research says giving it away 171 00:09:41,499 --> 00:09:45,239 much, much better for your happiness than using it on yourself. 172 00:09:45,239 --> 00:09:48,931 So, thinking about those three together. If you want to get happier, literally 173 00:09:48,931 --> 00:09:52,960 today, many of the things you think are the right thing to do. 174 00:09:52,960 --> 00:09:57,937 Are the wrong thing to do, and you can think about all the other things you can 175 00:09:57,937 --> 00:10:03,803 do instead, that will increase your happiness over time.