Social scientists analyzing a massive study of Americans' emotional well-being and their incomes have discovered how much money it takes to be happy, and it's roughly $75,000.
According to a release from the Proceedings of the National Academy of Sciences:
Daniel Kahneman and Angus Deaton analyzed over 450,000 responses to a daily survey of 1000 randomly selected US residents, and found that while life evaluation rose steadily with annual income, the quality of the respondents' everyday experiences did not improve above an income of $75,000 a year . . . As income decreased from $75,000, respondents reported decreasing happiness and increasing sadness and stress. The data also suggested that the emotional pain of unfortunate events or circumstances, including disease, divorce, and being alone are exacerbated by poverty, the authors report.
The researchers measured "happiness" by using a few different tests: They asked people to rate their lives on a scale of zero to 10, and then determined "emotional well-being" by asking people whether they had been stressed or unhappy the day before.
The authors aren't claiming that quality of life doesn't improve when people make more than $75,000 per year. Instead, they're looking at how emotional well-being is affected by income. What they discovered was that income strongly affects people's happiness when they make under $75,000. For example, difficult events like illness become harder to bear emotionally; and getting a raise brings a great deal of happiness. But once people make more money than $75,000, their moods are less affected by how much money they make. People who make more money aren't as stressed by divorce, and aren't as excited by raises as their less wealthy counterparts.