Money Buys Happiness When Spending Fits Our Personality

In brief

Using 76,000 real bank transactions matched to personality surveys, we found that people whose purchases suit their personality are more satisfied with their lives, and that this fit predicts happiness better than income or total spending does. A follow-up experiment showed the effect is causal: giving people a personality-matched voucher lifted their mood more than a mismatched one of the same value.

Abstract

In contrast to decades of research reporting surprisingly weak relationships between consumption and happiness, recent findings suggest that money can indeed increase happiness if it is spent the “right way” (e.g., on experiences or on other people). Drawing on the concept of psychological fit, we extend this research by arguing that individual differences play a central role in determining the “right” type of spending to increase well-being. In a field study using more than 76,000 bank-transaction records, we found that individuals spend more on products that match their personality, and that people whose purchases better match their personality report higher levels of life satisfaction. This effect of psychological fit on happiness was stronger than the effect of individuals’ total income or the effect of their total spending. A follow-up study showed a causal effect: Personality-matched spending increased positive affect. In summary, when spending matches the buyer’s personality, it appears that money can indeed buy happiness.

Links

Published version (DOI) · PDF · More on spending and personality