Last week we learned that one of the best ways to buy happiness is to spend money on experiences rather than things. Today, I want to explore a trick to squeeze a little extra happiness out of those same purchases.
The trick is paying in advance for as much of your experience as you can.
This helps increase the happiness you get from your experience in a few ways. First, it separates the event itself from the pain of paying. Next, the anticipation and delayed gratification will make you happier. Finally, in looking forward to your experience, the uncertainty of what is to come will bring you some extra happiness, as well. Continue reading “When Buying Happiness, Pay Up Front”
I apologize in advance for the inherent humblebraginess of vacation pictures. I did warn you, though.
I am generally a pretty frugal person. Three of my lastfour posts have been about saving money. I’ve written about cognitive biases that get in the way of saving money. I’ve written about the best way to hit savings goals.
And yet, I just spent a whole bunch of money on a three-week vacation to South Africa and Spain. This came thirteen months after a trip to Peru. Which itself came eight months after a honeymoon in the Bahamas (which, to be fair, was paid for with hotel points).
This may seem out of character or incongruent with my savings focus. But I don’t save money for the sake of saving money. I don’t intend to be the richest man in the cemetery. And while I would love to reach financial independence, I am not aiming to get there as soon as possible by any means necessary. Instead, I want to live my best (and happiest) life with as little waste as possible. Continue reading “How to Buy Happiness”
This is a great start, but it doesn’t mean anything if you don’t actually put that money away. Instead, our natural tendency towards mental accounting may be eating into, or completely negating, our savings.
As a preliminary note: Thank you all for the well-wishes in response to my last post! I had a lovely month out of the country (although everyone everywhere wanted to talk about Trump and the American election). If you’d like to see some pictures from Johannesburg, Kruger National Park, Durban, Cape Town, and Barcelona, feel free to check out my wife’s Instagram page. I also have some articles on vacation and travel coming up, in which I will include some photos from the trip.
And now back to your regularly scheduled programming…
Imagine for a moment that you are in the market for a new suit. You find one that you like for $200. A fellow customer then tells you that the same exact suit is on sale across town for only $100. Do you go?
Imagine that you are buying a new car. You’ve done your test drives and made a final decision on which make and model you want. You go to the dealer near your home to find that the car costs $30,000. A salesman sees you eyeing the car and says, “My manager would kill me for saying this, but the dealer on the other side of town has this model for $29,900.” Do you go? Continue reading “Your Instinctive Thinking Is Losing You Money”
You may have noticed that the last few days have been quite geared towards consumerism.
First, you had Black Friday, which in many places now actually starts on Thanksgiving.
Next came Small Business Saturday, which came about as a response to Black Friday intended to help smaller companies keep up with the big box stores.
And finally, yesterday, we had Cyber Monday, when the online retailers follow suit.
That’s quite a few days aimed directly at getting us to buy more things.
If you’re frustrated by the increasing consumerism and focus on buying stuff that has consumed the weekend after Thanksgiving, you are not alone. One group is trying to shift the focus from consumerism to charity. Continue reading “Happy Giving Tuesday!”
Today I want to revisit the world of housing. As an (almost) 30-something, buying a house is something that I have spent significant time thinking about. If my Facebook feed is any indication, then I am not alone in this.
Hedonic adaptation is the human ability to get used to pretty much any situation. This can be great when bad things happen to us.
One study measured the happiness of people with end-stage kidney disease against the happiness of healthy people. The kidney patients had to spend nine hours per week going through hemodialysis and stick to a strict diet. Both the kidney patients and the healthy controls felt that the healthy people would be significantly happier.
But they weren’t. Despite everything that the patients had to go through, they were just as happy as their healthy counterparts. They had quickly adjusted to their new situation and had adapted to it.
This is a really powerful ability! We can be happy regardless of what we are going through!
Last week I argued that the cost of happiness is actually significantly less than the commonly-cited $75,000. This, I argued, is because we are bad at knowing which spending will make us happier and which will not.
This may lead you (quite justifiably) to ask me to back this up. If I claim that people should spend their money differently, then how do I think they should spend it? And can I prove that they will be happier?