8 Psychological Keys to Spending Wisely

In these economic times we could all use a little advice on how to spend our money wisely.

In these economic times we could all use a little advice on how to spend our money wisely.

Help comes from a new survey of research on money and happiness gloriously titled ‘If Money Doesn’t Make You Happy Then You Probably Aren’t Spending It Right‘ (Dunn et al., 2011).

They are trying to explain this paradox:

“Wealthy people don’t just have better toys; they have better nutrition and better medical care, more free time and more meaningful labor—more of just about every ingredient in the recipe for a happy life. And yet, they aren’t that much happier than those who have less. If money can buy happiness, then why doesn’t it?”

Their answer is that we tend not to maximise our money because the human mind is surprisingly poor at working out what will make it happy. The conclusions they reach aren’t just useful for wealthy people, they can help all of us.

Here are the 8 pieces of advice:

  1. Why Many Small Pleasures Beat Fewer Larger Ones
  2. The Dangers of Comparison Shopping
  3. Why Spending Money on Others Promotes Your Happiness
  4. Buy More Experiences and Less Stuff
  5. Buy Less Insurance
  6. How to Get More Pleasure from Your Money
  7. The Impressive Power of a Stranger’s Advice
  8. How to Dodge Buyer’s Remorse

Image credit: iChaz

Author: Jeremy Dean

Psychologist, Jeremy Dean, PhD is the founder and author of PsyBlog. He holds a doctorate in psychology from University College London and two other advanced degrees in psychology. He has been writing about scientific research on PsyBlog since 2004. He is also the author of the book "Making Habits, Breaking Habits" (Da Capo, 2013) and several ebooks.

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