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Freedom, Not Money, Buys Happiness

freedom-happiness-11061502 . / Credit: Deamstime

You already knew money can't buy love — but it turns out it can't buy happiness either.

The real key to finding happiness is personal autonomy and freedom, which, in many cases, can be the result of having a sufficient amount of money.

This is good news for entrepreneurs and small business owners, who, perhaps, were ahead of the curve when it came to figuring out that working for oneself is the key to finding happiness.

That's the finding of new research published by the American Psychological Association (APA).

While researchers have long known that money doesn't buy happiness, researchers at the Victoria University of Wellington in New Zealand examined the relationship between the impact money has on happiness versus its impact on freedom and autonomy.

“Our findings provide new insights into well-being at the societal level,” the researchers wrote in the Journal of Personality and Social Psychology, published by APA. “Providing individuals with more autonomy appears to be important for reducing negative psychological symptoms, relatively independent of wealth.”

The researchers, psychologists Ronald Fischer and Diana Boer, examined three different studies that involved a total of 420,599 people from 63 countries spanning nearly 40 years. Their ultimate conclusion was that individualism and the freedom to make choices were the best predictors of well-being.

Money leads to autonomy but it does not add to well-being or happiness, the researchers found.

Previous research has shown that higher income, greater individualism, human rights and social equality are all associated with a greater sense of well-being. The effect of money on happiness has been shown to plateau — that is, once people reach the point of being able to meet their basic needs, more money leads to marginal gains at best — or even less well-being as people worry about “keeping up with the Joneses.”

These patterns were mostly confirmed in their findings.


Jeanette Mulvey

Jeanette has been writing about business for more than 20 years. She has written about every kind of entrepreneur from hardware store owners to fashion designers. Previously she was a manager of internal communications for Home Depot. Her journalism career began in local newspapers. She has a degree in American Studies from Rutgers University. Follow her on Twitter @jeanettebnd.