'MONEY can't buy you love" sang The Beatles, but it can - apparently - buy you happiness, according to new research.
Happiness, it says, is not simply the result of having a lot of money, but specifically having more than your peers. In other words, to be really happy you don't just need to keep up with the Joneses, you need to do better than them.
Researchers
at Pennsylvania State University examined the so-called "hedonic treadmill hypothesis" which suggests people are continuously competing with their neighbours to obtain wealth.
The research, led by Professor Glen Firebaugh, noted details of age, family income and "general happiness" from a representative sample of nearly 20,000 Americans aged between 20 and 64, between 1972 to 2002.
Happiness was measured by asking the participants if they felt "very happy", "pretty happy" or "not too happy".
The results showed that the richer people were in relation to their peers of the same age, the happier they tended to be. The poorer they were compared with their neighbours, the less happy they were.
"We found that the higher the income of others in one's age group, the lower one's happiness," Prof Firebaugh said.
And he also suggests we need to keep earning more all the time.
"Families whose income earners are in jobs with flat income trajectories are likely to become less happy over time," he added.
So it seems to be saying the way to get wealth and happiness, apart from a windfall or lottery win, is to have a high status job and earn a lot of money - with lots of pay rises in the offing!
Most of us, however, are going to have to settle for making enough to get by, so it makes sense to make the best of what we have got.
This includes regular reviews of our savings, investments and expenditure to make sure we are getting the best deal and securing the best rates.
A first step would be to look at the following areas:
Mortgages Keep an eye on your mortgage rate. If you are coming to the end of a special rate deal, don't simply slide over into an uncompetitive standard variable rate from your lender.
Shop around and ensure that you are not overpaying.
Credit cards A lot of excellent offers are finishing, but there are still zero per cent interest deals to be had on both balance transfers and purchases. If you don't clear your balance every month, make sure you have a card that suits your needs and is not charging you an arm and a leg. For overseas purchases, use a card that does not charge you exchange rate loading, such as Nationwide.
SavingsAre your savings in the best place? There are some shockingly low-paying accounts out there. Make sure you are getting a competitive rate of interest - and don't forget to use your ISA allowance to avoid paying tax.
If you can afford to put money aside each month, consider a regular saver account, which will often pay you more than an ordinary deposit account. Checking out the rates available only takes a few minutes of your time. Visit www.moneyextra.com or speak to an independent financial adviser.
Willie Ewen, AWD Group, www.a
wdplc.com
This does not constitute investment advice and you should seek independent financial advice if you are unsure as to the suitability of any investment for your circumstances. Past performance is not an indication of future performance. The value of investments may fall as well as rise and you might not get back the full amount invested
The full article contains 621 words and appears in Edinburgh Evening News newspaper.
