Happiness in the bank

MONEY might indeed buy you happiness, but only if you have more money than your peers. New research shows that the richer people are compared with others in their age group, the happier they tend to be. “It creates a kind of treadmill of consumption,” says Laura Tach, a sociology graduate student at Harvard University who conducted the research. “We earn more money, but so does everyone else.” The results of this monetary race seem to affect happiness more than a new car or a bigger house.

Researchers assessed age, health, total family income and the general happiness of approximately 20,000 20- to 64-year-olds using data gathered from 1972 to 2002 in the General Social Survey, a national survey conducted every one to two years. Tach and collaborator Glenn Firebaugh, a sociologist at Pennsylvania State University, found that physical health was the biggest predictor of happiness, followed by income and education. According to the findings, an individual who earns $20,000 more than the peer group average is 10% more likely to be very happy than someone who earns $20,000 less than the average. The absolute size of an individual’s income had only a small effect on happiness.

The research was to be presented Sunday at the American Sociological Assn. Centennial Annual Meeting.