When Money Creates Unhappiness and Anxiety: Thinking About Financial Security Decreases Life Satisfaction

Can money create unhappiness and anxiety? Research shows that planning finances and thinking about future financial security decreases overall life satisfaction.

Here, a Princeton psychologist shows the connection between wealth and happiness – and when money does increase life satisfaction.

Thinking About Financial Security Decreases Life Satisfaction

Women who think about financial matters too much are less likely to be happy with their lives, says Talya Miron-Shatz, a postdoctoral research fellow in the Woodrow Wilson School of Public and International Affairs at Princeton. Further, simply having enough money doesn’t lead to happiness – the connection between wealth and happiness is more complicated.

"Even if you are making a hundred grand a year, if you are constantly worried that you are going to get fired, that you are going to lose your health insurance or that you are simply not sure you are going to 'make it,' you are not going to be happy," said Miron-Shatz.

In this study, women at all income levels experienced decreased life satisfaction when they focused on money. Whether they were rich or poor, living in wealthy estates or low income rental housing units, women who fixated on money were more prone to unhappiness and anxiety.

Why Are Women Happier When They Don’t Focus on Money?

In Miron-Shatz’s study, women who didn't fixate on finances such as retirement savings, tuition for college or simply making ends meet, report being happiest of the groups studied. Feeling financially stable is crucial to life satisfaction and happiness – no matter how much money is available.

"It's not about greed," says Miron-Shatz. "It's about knowing whatever it is you have, be it your McMansion or your motor home, won't be taken away from you."

Money creates unhappiness and anxiety because it isn't connected to positive memories or experiences. Money doesn't offer long-lasting rewards or deep connections. Past research shows that experiences with other people is the most effective way to increase life satisfaction. Money can't buy happiness, though it can increase feelings of security.

To be happy and reduce anxiety in life, find a healthy balance between taking care of finances in the present and for the future. And, don't fixate on planning finances or general money matters.

The copyright of the article When Money Creates Unhappiness and Anxiety in Psychology is owned by Laurie Pawlik-Kienlen. Permission to republish When Money Creates Unhappiness and Anxiety in print or online must be granted by the author in writing.

Sep 10, 2009 1:02 PM

Guest :

I can see how focusing on money could create anxiety - especially if the person is worried about having enough or losing it etc. I've seen people of all income levels be stressed about money - it's all relative. People with huge incomes can also have huge mortgages and spending habits.

For me, if I trust that there is enough money and that I can take care of myself no matter what (or that the universe is supporting me), then I relax around money. But if I let worry thoughts or fears about the future dominate - I get anxious.

I think the key here is around trust. If a person trusts that there is enough, then they relax about finances (and don't need to dwell on them). It really does mean undoing old fearful beliefs from unpleasant past money experiences. Takes time and persistence to do that. Really, money is just and exchange of energy - an exchange of a service or item connected to one's time and energy exchanged through the medium of money. I think too many people give their power away to money and make it bigger than them. When we realize that we are the source of our money, we relax a bit more.