Happy money

Apart from sport, pretty much the only TV we watch in the US is on the public channels. They have a strange funding model, in which they cannot (or choose not to) advertise, but have little or no public funding. This means they have to constantly beg for donations, and in the end the schedule is interrupted just as often with begging as other stations are interrupted by advertisements. Sometimes I wish they would just take ads.

The funding model may be outdated, but the remainder of the charter offers quality not otherwise available on US TV. A good example is news, which has become a desert elsewhere but remains worth watching on PBS. On most channels, news is a mixture of local scandal, weather, gossip and some trite political point scoring, and is truly excruciating. PBS has a nightly one hour broadcast with a balanced summary followed by interesting features. It is excellent.

Typical of the features is a weekly series about making sense of economics, put together by a guy called Paul Solman. He is typical PBS, getting on a bit and lacking in charisma, but with a knack for an interesting informative angle. His reports are topical and balanced, and always inform me of something new. Just like all the Newshour, in fact.

A few weeks ago, Solman ran a feature about the link between money and happiness, centred around a book by Liz Dunn and Michael Norton called “Happy Money”, and involving an extensive interview with Dunn. I was sufficiently aroused to actually buy the book, though upon reading it I wish I hadn’t, since it adds little to the headlines and is in a rather annoying style. At least the book supports the headline claims by showing that most conclusions are based on thorough research.

Like many business books, this one follows the tried and tested and rather superficial approach of coming up with a limited number of key headlines. In this case, there are supposedly five megatips for finding happiness from our money. There is no claim that money makes you happy, though an acknowledgement that a lack of it often makes you unhappy. Instead, the starting point is that many of us blessed with some money do not always act in ways that help towards happiness.

The five themes are to buy experiences, buy time, make things a treat, pay in advance, and buy for others. All of these are fairly self-explanatory. In the book, there are long-winded explanations, lots of support from studies and experiments, and a few stories.

The only one that I had to read more about to understand was about paying in advance. Seemingly, the joy is in consuming, and paying at the same time can remove some of the joy. Paying afterwards also affects the joy, because there is a lingering anxiety or awareness of the future obligation. Paying in advance leaves space for untrammeled joy. I guess it makes some sense.

The one about making things a treat could perhaps be better expressed as its converse, to avoid good things becoming routine. It is not easy to always remember to count our blessings, and the more regular the blessing the easier it is to forget to count it. So either make a point of celebrating each time, or otherwise mix things up so that good things feel like a treat.

Rather than reading the book, I suggest thinking about each of the five in terms of our own life. Try to avoid feeling smug, or locked in to unhappiness, but instead look for ways to do a little better in each dimension.

Initially I fell into the smugness trap. What can buy more time than retirement? Where offers richer experiences than New York? I do have routine joys, but try to find ways to celebrate, such as associating my slow morning latte with reading, thus enhancing both blessings. I avoid debt and often pay in advance. And finally, wonderful people in my life have gradually and falteringly taught me to be generous, and, the book is true at least for, the joy from generosity is boundless.

Slightly less pointless than smugness comes a bit of understanding why some things work. A corollary of making good things a treat is to make chores a routine. So it is smart to always do the washing on Mondays and to swim on Tuesdays and Thursdays and to shop at 10AM. Routines minimize misery from chores, and I can think of other chores I can make a routine.

In between smugness, denial and understanding comes my personal folly, the Portugal villa. If this seems to break all the five rules, why does it still make me so happy? Maybe because I associate it with experiences and anticipation and an abundance of time. 

Paying in advance is partly about savouring anticipation. I guess a tiny bit comes from my Starbucks card, but more typically comes from planned holidays, usually paid in advance. It is true that the anticipation of a trip is a source of happiness, often more than the trip itself.

I now have a family that comes from a culture of gift giving. It is something that annoys me, and I have tried to understand it in terms of the five principles. Giving gifts is helping others and providing treats, so should give pleasure. But somehow it doesn’t often give me pleasure on either the giving or receiving end. Partly that is just my ungenerous nature, I wonder if a gift culture can become so strong that it starts to work against the principles. If it is so routine as to be expected, it is less of a treat. And a gift creates an obligation, so it might go against paying in advance. Finally, such gifts are usually material items, so not time or experiences.

So one takeaway could be to use the rules to give better gifts. Can we choose experiences that people can then anticipate, such as holidays or shows? Or can we give people time, for example by doing their chores for them? Best of all, maybe we can give ourselves as part of an experience, using our talent or just companionship. I know the best gifts that I have recently given are of this type, and I also know that these new giving experiences have made me very happy: I hope and believe the same is true for the recipients. I also know I can do a lot more, and resolve to do so.

So try to move beyond smugness or hopelessness, and then try to move beyond diagnosis. The true gift of the book is in how it can help us change our actions, not just our understanding of our current actions. There are no doubt possibilities for all of us in all five dimensions.

The book makes a timid attempt at the end to link its findings towards public policy. One obvious way that most people can buy time is to prioritise a shorter commute over a bigger house. There is already a trend towards this, with more and more people with money choosing to live in cities rather than suburbs. The state might be able to encourage this further by improving public transport, taxing fuel and reducing subsidies on mortgages. This sort of policy might be able to nudge us into decisions that have a by-product of happiness.

This is tough for politicians, but then I wonder how interested most politicians really are in the happiness of their citizens anyway, except for the week before polling day. Even more productive might be public policy that helps to wean us away from debt as a means to pay for more and more things. Currently, many policies positively encourage debt, for example by subsidizing mortgages or allowing many expenses against tax. The problem is the whole edifice of modern economies relies on debt. Remember when David Cameron first came to power, and promoted people paying down their credit card debt? He soon changed his tune, not just because all his donors preyed on our debt, but also because the whole economy would collapse without it.

So, I find this a useful topic. It is one more reminder that the modern stereotype of a commuting workaholic who acquires stuff on credit to match the neighbours’ stuff and doesn’t look beyond family is not a role model for happiness. It helps to explain why people like priests and nuns are usually happy. And hopefully it can generate a couple of useful actions in all of us.