I'm Michael Norton. I'm an associate professor at Harvard
Business School. And a lot of my research looks at the
relationships between money, time, and happiness.
And the reason those three things are interesting to me.
And interesting at the same time, to study them is because, we spend so much
of our mental energy thinking about. How to be happy and if we're happy
enough, and I'm not happy today and I felt happier last week, or this
relationship made me happy and this one made me unhappy, or should I get a new
job, or should I talk to my parents more. But we don't know a lot about how to make
ourselves happy. We have some theories about it, but we're
not really that good always at figuring out what the best way is to feel happier
today and tomorrow and next year. And one of the key resources we have for
making ourselves happier is our money and another key resource is our time.
So these are the two things that we have some of and we can spend them in
different ways. And our research looks at what are the
best ways to spend those two things. To spend your money and to spend your
time, to make yourself a happier person. And the problem with both of those is
we're not good at knowing how to spend them and they mess us up along the way.
And we become less happy instead of more happy when we use these resources.
So, let's start with money. So, there's a lot of problems with money.
The first one is we think that money is going to make us a lot happier than it
actually does. So, it turns out that when you make some
income you do get a little happier if you go from being poor to sort of middle
class But after that it actually really starts to taper off.
So it's not that more money is bad for you, it just doesn't keep making you
happier in the way you want it to. And yet we keep trying to make more and
more of it. We keep trying to get a better job and
make more money. And we're just wrong in terms of how
happy it's, it's really going to make us. And the other problem with money is
separate from this problem, which is just it wears off, is that money actually
makes us really selfish. So when we get money, the first thing
that we think is, what can I do for myself with this money?
So if you thought about if you won the lottery today.
And I said, what do you want to buy with the money you won?
I bet the first think you would think is, what kind of a house, and what kind of a
car, and what kind of a everything can I get for me.
And that means, that you're sort of using your money for things that are self
focused and inwardly focused. And we know that that doesn't necessarily
make us happy. We don't know a lot of really, really
selfish people. If you think in your everyday life, who
are really kind of happy rosy people. Usually, they tend to be quite sad and
unhappy. Our question really was with, how do we
switch people's attitudes with money? We've got this problem, where money is
wearing off. We've got this other problem where
money's making you selfish and only caring about your own possessions and
your own life. We said, is there a way to make this
curve keep going up. So can we make money keep making you
happy by making you not use it all on yourself.
That maybe the problem is that we have this curve, because we become so selfish
when we get wealthy. And if we instead encourage people to use
the money on anybody else than themselves.
That might be a source of real happiness for people and that might make money keep
making you happy. So the very first way that we tested this
was in a study that we ran in the University of British Columbia and we
literally said, let's just give people money, let's just dole out cash to people
and tell them how to spend it, and measure whether it made them happy or
not. So we went on campus one morning and gave
people envelopes, filled with money. And we said, will you be in our
experiment and if they said yes we gave them an envelope it had some money in the
envelope and there was a slip of paper that said to some people by 5:00 pm today
spend this money on yourself. That's the way that we usually spend our
money is on ourselves but to the other people we said by 5:00 p.m.
Today spend this money on somebody else, like a gift for a friend, or, or a
donation to a homeless person. Same amount of money, very tiny
difference in what the slip of paper said.
We called them back at the end of the day and asked them, what did you with the
money, and we asked them, how happy are you, over the course of the day.
And it turns out that people who spent money on themselves, it wasn't a bad day,
we gave them $20 and they got to buy something, so they weren't less happy
than they were. But they didn't get any happier, even
though they got this free money. But the people who we said spend this
money on somebody else, they actually got happier.
So we asked them, what did you do? And they said, oh, I bought a stuffed
animal for my niece, or I bought my friend a coffee.
And those things actually led them to be much happier at the end of the day, then
doing what they usually do, which is just using their money on themselves.
Then we thought well that's interesting because that means there's some advice
that you could do right now, today to make yourself happier which is quit
spending all your money on yourself and take $5 out of your pocket and spend it
on Salomone else or give it away. But we ran these studies in the United
States and we ran them in Canada, and these are pretty wealthy countries.
Maybe it's the case that if you have a lot of money, sure giving it away feels
good. But would it be the case if you were
quite poor in the United States? Or even if you lived in a very poor
country like some Sub-Saharan African countries?
Would we still see that even when you're poor and you need money for yourself, it
still actually can make you happy if you give it away?
So we set out to test that, so we've done these same kinds of studies, we give
people money for themselves or we give them money and make them give it away.
We've done these studies in South Africa, in Uganda in Canada, in India, all over
the world where we've looked everywhere we've looked.
It looks like, when people give money away.
It's better for their happiness, than when they spend it on themselves.
Even when we look at very, very poor countries.
So there's this very basic relationship between money and happiness that we're
getting entirely wrong. So this, these two problems of, it's
wearing off over time And we spend it on ourselves.
Little tiny shift in your behavior, just taking some of that money that you spend
on yourself, people still will buy cars and houses and coffee for themselves and
all those things. A tiny shift where you take that and
spend it on someone else, literally something as small as buying someone else
a coffee instead of yourself, changes this relationship a bit and gets you
happier with your money. Now let's think about time, so we're
clearly getting money wrong in some sense.
What about time? That's the other thing we have.
We get some everyday. Actually, we get 24 hours of it everyday,
because there's only 24 hours in a day. But we can choose how to spend our time,
not quite in the same way as spend our money, but still, it's a resource, we can
do whatever we want with it, and we decide how to dole it out among different
things we want to do. We're going to eat.
We're going to sleep. We're probably going to watch TV.
All of these things that we like to do, but we can do whatever we want with it
really. And again, so remember with money people
often spend it on themselves. And it's very about, what I want and what
I need to do today. We find that people do the same thing
with time that, that they really think they should use their time on themselves.
Everyone reports being stressed about time.
Everyone says this, this phrase a time famine.
Literally, people feel as though they're starved for time and they, if they only
had more time, they'd be happier. And the way that they try to deal with
that feeling is to spend time on themselves.
So they do things like get massages. Massages are great, we all love massages.
But just like buying yourself a coffee Is nice but it doesn't make you happier.
Getting yourself a massage is, is really, really nice but it doesn't really change
your perception of your time all that much.
You like the massage when it's done, you still feel stressed about everything you
need to get done. And also just like with money, remember
we said that giving money away makes you happier than, than spending it in
yourself. It turns out that giving time away.
Actually, makes you feel that you have more time, than spending time on
yourself. The way that we do these studies to try
to show this is imagine, again one day. I send you an email, and say, by 5 o'
clock today, I want you to spend some time on yourself.
And people do things like get massages and get a haircut, and all sorts of
things. Other people, again we say, by 5pm today,
spend some time on somebody else. Then we asked these people, how do you
feel about your time? Are you stressed about your time?
Do you still feel like you have a time famine?
Turns out like with money again with time if you spend time on yourself you don't
feel any, any more stressed about your time.
But it doesn't do anything for you. You still feel just as stressed as you
did before, but people who spend time on other people they help someone with their
homework or they go volunteer at a soup kitchen.
People do all kinds of things to help other people that actually makes them
feel as though they have more time in their day.
And at first glance it doesn't make a lot of sense so you'd think if, if I don't
have enough time for myself. How can spending some of it on anybody
else make me feel better, because then I'm even busier than I was before.
But it turns out that when we give to other people, it signals to us that we
have a lot of whatever we're giving away. So if I have enough money to dole out to
people, or if I have enough time in my life, where I can give it away.
It means that I actually must have a lot of time, and that signal to us makes us
feel better about our time. And in fact, we can show that when people
give time away, they actually become more willing to do more things in the future,
because now they feel much better about the stress that they had, about their
time. So money, happiness, and time.
We all want to be very, very happy. And we have these two key resources that
we can spend every day, and over the course of our lives, our money and our
time. The way we usually spend them, not
horrible. We're not totally wrong in what we do.
But we're not spending them optimally, to make ourselves the happiest, which is
our, one of our biggest goals in life is to be happy.
What you can do instead, is any time you have some free time.
And you're thinking, let me spend it on myself, give it away.
Call a friend, help somebody, sign up to volunteer.
Any of these activities that are other focused instead of all about yourself.
Same thing with money, any time you get some money.
And, many of us have enough money to at least give some money to charity, and
things like that. Your impulse will be, oh, I have some
money let me spend it on myself. Again, the research says giving it away
much, much better for your happiness than using it on yourself.
So, thinking about those three together. If you want to get happier, literally
today, many of the things you think are the right thing to do.
Are the wrong thing to do, and you can think about all the other things you can
do instead, that will increase your happiness over time.