If money doesn't make you happy, you probably aren't spending it right [pdf]
wjh.harvard.edu
wjh.harvard.edu
This is a social evolution sort of a thing: if you are a zealot and you know how to spend money to effect the change you want, then you aren't going to stay on the money-accumulation train for anywhere near as long. You'll spend it, and make some of that change happen.
You need something like this sort of effect to explain why there are any wealthy people at all. Any one of the Forbes 100 could cure a couple of diseases, get a fair way to demonstrating a cure for aging in mice ($1 billion price tag), develop the tech to irrigate the Sahara, etc, etc. But they largely do not, and remain within the process they have built for themselves. Where they do go all out for philanthropy, there is usually a startling lack of imagination - see the Gates Foundation, for example, which is doing nothing more than business as usual in big philanthropy, or the Ellison Medical Foundation which does nothing more than replicate the NIH.
Anyway. Knowing how to spend money "right" (meaning right for you, your vision, having a vision, etc) is not compatible with accumulating money, and only the outliers will fall into both camps.
http://www.fightaging.org/archives/2012/02/one-wealthy-zealo...
If I were in the billions of dollars rich, I don't know if I'd want to do much to change the world. You can call me unenlightened, but and the end of the day, I'd be the unenlightened billionaire and you'd just be some person trying to tell me how to spend my money.
On a fundamental level - individual scandals and cynicism about Gates' motives aside - what is the foundation doing wrong?
Oddly, I'd expect his parents would know better, too.
I wouldn't call things like the giving pledge "business as usual" in big philanthropy. I can't think of any prior art for it.
Philanthropy done right looks much more like the Thiel model:
http://www.fightaging.org/archives/2010/12/peter-thiel-encou...
http://www.fightaging.org/archives/2012/04/breakout-labs-ann...
The Gates Foundation would do far more good in the world by splitting itself up into a hundred or a thousand more directed and competing interests, focused on bottom-up change one innovation at a time.
As it is, the majority of its funds will probably eventually evaporate in the grind of top-down existing strategies that have solved nothing permanently - but have instead led to government-bound institutions that do more to perpetuate the problems they allegedly try to solve than generate good in the world, or which have turned into jobs programs for comparatively privileged individuals, disconnected from any need to achieve concrete results.
I agree with much of what you're saying, but my overall outlook isn't that negative. There is a real chance that their work will help completely eradicate malaria. If that's not solving something permanently, I don't know what is.
Andrew Carnegie, in The Gospel of Wealth, railed against inheritance and said, "The man who dies thus rich dies disgraced". He advised fellow millionaires of his era to donate their fortunes during their lifetime to activities that would create greater wealth in the community, such as free libraries for the poor.
I'm genuinely curious-how is that "business as usual" for big philanthropy? Who else is successfully nearly eliminating major fatal diseases?
I don't buy experiences, and I don't buy possessions. I buy camping gear, musical instruments and other experiential possessions. But, this concept is lost on consumer researchers, who skew young, female and IMHE, assume the whole world is choosing between a pair of shoes or nice restaurant meal.
(FWIW, I just got my masters in research psychology.)
[Edited for spelling]
Like I said, the field is overly obsessed with lowest common denominator purchase decisions, that IMHO, are totally at odds with the phenomena they are trying to investigate.
They do mention that some things (they give the example of a car) fall in the middle of the possession-experience spectrum, but I'd argue that almost everything does.
There is a reasonable minimal threshold, but if your spending more than 500-1,000$ on camping gear a year your probably just buying gear for the same sorts of reasons people buy 100,000$ cars.
When I was younger, our school used to host a rock concert about twice a year where student bands would play. Since I was far from being the most popular kid in school I figured that getting up and rocking out on that stage would earn me some cred.
Of course to do that you needed to be in a band, and since I couldn't sing at all being in a band meant you needed to be able to play some instrument. So I went to the local pawn shop , bought the cheapest electric guitar I could find and borrowed a spare amp from a family member. Of course what I really spent the money for was to be able to feel like a rockstar for 20 minutes.
Now if I think about all the people I still know from those days playing in the school hall; apart from one or two who managed to get a career in music, most work in IT , accounting or became plumbers etc. They all now have nice collections of expensive guitars (Les Pauls , Ltd Ed. Stratocastors etc) that they love to show off but rarely play anywhere besides their own homes. Really the amount of pleasure that they get from them is probably nothing compared to the joy we had while rocking out at school playing 4 chord greenday & nirvana covers on our £50 pawn shop axes.
Spending the extra $10k for a better car leads to less happiness than using that same money for a 2-week vacation in Europe / Asia.
"Money is like a sixth sense without which you cannot make a complete use of the other five."
A corollary is "Your startup needs to sell experiences, not features":
http://news.ycombinator.com/item?id=2662671
Previous discussions ("Money = Happiness, but when it buys experiences"):
http://news.ycombinator.com/item?id=482036
"Spend money on experiences, not possessions"
Eh,
What about B2B startups? What about any utility application? Say, internet search? I'm going to kill Google (and Gabriel Weinberg) if they turn their search engine into an "experience".
Seriously, guys, can we stop the "startup == social local friend to friend mobile app thing" thing already?
The iPod is an experience. Most early MP3s had the same or more features, but the iPod killed them, because it provided an interesting experience of listening to music.
Amazon is just another Walmart, too. But with a buyer experience that's much better than anyone else's. Same thing with Facebook vs. MySpace. Or Steam vs. Origin vs. your local videogame shop.
What I guess the article meant to say in another way is that your startup needs to focus on its value proposition, “How will buying/using this ... make my life better?”.
In the case of both Google and DDG, what they deliver to the user. It's no accident Google has Instant, previews, etc (and DDG has DuckDuckHack)... it's all about making the search experience better.
UX is the most important feature. Canonical example: Apple. Apple "gets" usability. No other pc manufacturer comes close. Their methods are dubious and I don't agree with all of them, but their stuff works nicer than anything else right now (for the latest number of lay people.)
Other pc mfgs don't even try to design beautiful, elegant hardware and market it to everyone. They think that everyone wants cheap crap, so they deliver and iterate on that. All of Apple's offerings are premium, and you can't argue with their success. /people want nice stuff, not cheap plastic crap/ -- but it gets harder and harder to find nice stuff outside of Apple.
Who still makes a laptop with a 1920x1200 display? Apple. HP and Lenovo did too last I checked, but the industry has largely moved to the cheaper-and-worse 16x9 panels. Apple also cares about obvious stuff that other mfgs ignore. Example: trackpad texture. Even on a $3500 gaming laptop from a specialty mfg, they don't get it and the trackpad is too grippy and hurts your finer after 5 minutes.
BUILD QUALITY OR DON'T BUILD
How about the second item, "consumers should ... use their money to benefit others rather than themselves" -- any ideas for a startup there?
So, a startup should be looking at positive externalities of its business.
KickStarter is making money, but it brings new products to life and enables funding models previously unachievable (e.g. a lot of Indie movies).
"Your startup needs to sell experiences, not features"
Check out our startup!
Experiences, not products
As for #2, I started backing more projects on Kickstarter. It does feel great to see people doing all sorts of cool projects. For example, I wish I had time [and skills] to make a movie with Blender, but since I can't I'll enjoy it through the work of others.
http://www.kickstarter.com/projects/1331941187/the-tube-open...
Oh, and I'm helping to build a 10" rocket engine!
http://www.kickstarter.com/projects/hermesspace/hermes-space...
Despite the grand importance of time as the absolute foundation of wealth, very little progress has been made in the most obvious optimization of all: creating property that can create more time. More heartbeats, more health, more time spent alive and active. Rejuvenation medicine, capable of repairing the damage of aging. Tissue engineering to generate replacements for worn organs. The cure for cancer. If you could do all that, then the much more productive form of escape velocity becomes possible - longevity escape velocity. Why strive to maintain an empire of property that will crumble to dust when the degenerations of age catch up with you when you could be that fit-looking guy having a blast swimming in the breakers every other Sunday for as long as you like?
Wealth is exactly time, and here we are, bordering the era of biotechnology for the repair of aging. Planning ahead for the best possible personal future starts with investment now. Think about it.
Paying someone to keep my house clean on the other hand is an excellent idea.
"People seek extended warranties and generous return policies in order to preclude the possibility of future regret, but research suggests that the warranties may be unnecessary for happiness and the return policies may actually undermine it."
Perhaps they will be more likely to refer friends to your service if you don't give them a return policy, since rationalization will kick in and they will make themselves happier with your service if they're stuck with it.
The things that make people truly happy are internal, and must be constructed by the person experiencing them. Money can remove discomfort or provide passing distraction from existential malaise, but it can never make you truly happy.
Of course they don't sell these things in shops, but with money, you can create really good environment for yourself to pursue them.
Oh, and money sure can buy achievement and respect. You can enroll in best schools or hire best teachers with money to get knowledge and competence. It's easier to find love if you have money, for a wealthy man seem to be more attractive for women. I could go on, but the point is, don't downplay the value of money.
It is easier to find a relationship with money. The person you are in a relationship with will love your money, and tolerate you. Women do love successful/capable men, but in my experience it is the success that is attractive, not the money. As an example, a bankrupt but famous actor or rock star will massively out-compete a rich hedge fund manager. This definitely isn't just about looks, I once met a very attractive girl who waxed poetic about her desire to thoroughly ravish Phillip Seymour Hoffman.
I wasn't suggesting that money is always the best solution, but frequently it's a really good, or at least good enough one. More importantly, it's quite general solution that will get lots of your problems solved, which is not the case with being bankrupt famous actor.
My experience (having gone to a good school) is that the most valuable thing they have to offer is contacts. The actual education is vastly overrated. The bulk of my knowledge came from figuring out a problem I wanted to solve, then learning everything that was required to solve it.
Then it'd be like.... surprise : )
As the article says "Money allows people to live longer and healthier lives, to buffer themselves against worry and harm, to have leisure time to spend with friends and family, and to control the nature of their daily activities". These are very much necessary preconditions to be happy.
Yes, but money isn't the only way to achieve them.
There's an apocryphal story about a guy who goes on a fishing trip and tells the guide that he enjoyed it so much that he's going to go home and make a lot of money so he can go fishing every day. The take-away being that the fishing guide is doing just that. (Yes, there's more to being a guide than fishing, but a fishing-bum lifestyle doesn't cost that much.)
"Life" has a burn-rate. Is yours going for things that matter to you?
You pay them enough, and then make sure they have rewarding work, a supportive environment and a boss who understands and empowers them. Money is just the start
My hypothesis here is that the happiness is coming from creation and strengthening of interpersonal connections as a result of post giving interaction, not from the act of giving itself. I would be interested in studies where someone spent money on others in versus themselves without the opportunity for interaction or feedback upon giving. I suspect that would confirm my hypothesis.
In any case, I think the idea that true happiness comes from within, which I think is what your describing, makes sense. True happiness cannot be manufactured by buying "experiences". I don't think a laundry list, created by someone other then you, of things to do with your money can make you happy with yourself. If your not happy with yourself nothing you experience will just make you happy.
It starts with you and I'm not sure that money can buy you internal happiness.
A better idea would be to find out how people without money are able to be truly happy. I'd love to see that list...
Because he takes a scientific study based on actual data, calls it "bullshit", and substitutes his own pet theory of happiness, maybe?
1. This assumes that consumptive happiness is additive and unbounded, i.e. if consuming A makes you X points happier, and consuming B makes you Y points happier, consuming A and B makes you (X + Y) happier, ad infinitum. There is no evidence of this, and this is such a strong assumption that to assume it in the absence of evidence is fallacious.
2. Their data surrounding giving does not control for interpersonal interactions, and personality characteristics. Since these two variables are both strongly confounding, their results are weak at best.
Beyond that, this is a review paper containing no new data. They are essentially taking isolated data points and playing connect the dots to generate their own pet hypothesis.
My "pet theory" of happiness is actually the distillate of the idea of happiness as established in a variety of neutral literature (from Aristotle to moderns like Layard and Lyubomirsky), informed to a degree by evolutionary biology. Do you really trust the impartiality of people publishing in journals for "Consumer Psychology"? That reminds me of health studies commissioned by cigarette companies.
Down-vote away, it only saddens me to the degree that it makes people less likely to be exposed to a dissenting but informative viewpoint. I don't care a whit for the popularity contest aspect of it.
I have known homeless artists, poets and musicians who were much happier than some very wealthy people I've met. Creative endeavors are the most common, with lots of genuine friendships being high on the list as well.
Check us out: http://blinkcollective.com/