Using Your Money To Be Happier

Why It Matters

Understanding the weak link between income and happiness helps individuals and firms allocate resources toward time, relationships, and purpose, delivering higher well‑being and more sustainable financial decisions.

Key Takeaways

• Money improves life satisfaction, but not day‑to‑day happiness.
• Happiness plateaus after $75‑$85k income; extra earnings yield diminishing returns.
• Prioritizing time over money boosts relationships, engagement, and overall well‑being.
• The PERMA‑V model highlights emotion, engagement, relationships, meaning, achievement, vitality.
• Social comparison and adaptation often undermine expected happiness from financial gains.

Summary

Ben Felix, chief investment officer at PWL Capital, argues that personal finance should fund a good life, not merely accumulate wealth. He explains that while sufficient income is essential for basic needs, beyond a modest threshold money contributes little to day‑to‑day happiness and only modestly to overall life evaluation.

The video cites multiple studies: a 2010 paper showing experienced happiness plateaus around $75,000 (about $112,000 today) and a 2018 study finding similar satiation points. A 2021 real‑time survey suggests higher incomes still boost both experienced and reflective happiness, but only for those already happy. Felix frames these findings within the PERMA‑V model—positive emotion, engagement, relationships, meaning, accomplishment, and vitality—as the core ingredients of well‑being.

Felix highlights concrete examples: home ownership does not reliably increase happiness compared with renting, and the pursuit of higher‑paying, high‑stress jobs often erodes time for relationships and leisure. He stresses that people overestimate the joy from financial gains due to adaptation and the “end of history” illusion, and that social comparison can drive wasteful spending.

The takeaway for investors, employers, and individuals is to prioritize time‑saving choices, nurture intrinsic goals, and align financial decisions with the PERMA‑V factors. By treating time as a tradable asset and focusing on relationships and purpose, one can achieve a higher quality of life without chasing ever‑higher income.

Original Description

This is probably the most important video I’ll ever make. I hope it will change your life the same way that researching it changed mine. I used to think that working, saving, and investing were all about getting as much money as possible. Don’t get me wrong, money is a powerful tool, we need at least enough money to live, and money can solve some problems, but more money is not in and of itself the main goal of personal finance.

Personal finance is about funding a good life, which is subjective, but there is a lot of evidence about what, generally speaking, constitutes a life that people will evaluate as good. The crazy thing is that a lot of the common perceptions about what makes life good are often at odds with reality.

------------------

Meet with PWL Capital https://pages.pwlcapital.com/en-ca/contact-us?utm_source=content&utm_medium=youtube&utm_campaign=benfelix_yt

Find Your Financial Goals with PWL Capital's Goals Process

https://research-tools.pwlcapital.com/research/goals

Timestamps

00:00 - Intro

01:51 - Types of Happiness

03:48 - Income Satiation

08:28 - Happiness & The Future

11:48 - Financial Decision Making

17:06 - Regret

19:02 - Setting Goals

References

https://zbib.org/bff328eed49844e2b6b615f15a5d3cff

Avoid Online Scams https://pwlcapital.com/stay-safe-online/

Check out the Rational Reminder Podcast

YouTube channel @rationalreminder

Podcast website https://rationalreminder.ca/

Rational Reminder community (forum) https://community.rationalreminder.ca/

Apple Podcasts https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582?mt=2

Spotify https://open.spotify.com/show/6RHWTH9iW7hdnA7eAg7ukO?si=hjZNfLKuSjSeWX38GPqhVA