Psychological Correlations between Wealth and Wellbeing

Introduction

When it comes to money, society is awash with sayings, truisms, and clichés. Among the most pervasive is the notion that money is the "root of all evil," a sentiment echoed across cultures and generations. Another commonly held belief is that money cannot buy happiness, a theme explored in essays by David G. Myers, Elizabeth Warren, and Charles Murray. While it is indeed true that many affluent individuals are often unhappy, the absence of financial stability undeniably amplifies stress and misery for those struggling to make ends meet.

Despite the wide range of opinions on the subject, it is crucial to examine well-supported perspectives. This essay argues that while money does not inherently create happiness, its absence can significantly exacerbate stress and dissatisfaction.

The Vanishing Middle Class

Elizabeth Warren, a prominent voice on issues of income inequality, wages, and financial well-being, provides a compelling analysis of the contemporary economic landscape. In her essay, Warren describes the "vanishing" middle class, highlighting the declining average income for this demographic. She points out that while household incomes appear to have increased, much of this is due to the rise in dual-earner households. When adjusted for inflation, the average male income has stagnated at around $40,000, despite a more than fifty percent increase in household income since 1970. This suggests that families are working more hours to maintain the same standard of living, leading to less time with family and a potential drain on happiness.

Warren’s observations suggest that money cannot buy happiness if it comes at the cost of work-life balance. Her analysis reveals that single-earner and single-parent households face even greater challenges, as they cannot rely on additional income from a second earner. This further supports the argument that while money itself may not create happiness, its absence can contribute to stress and dissatisfaction. Ultimately, Warren’s perspective underscores the complexity of the relationship between money and happiness, emphasizing that financial stability does not necessarily equate to personal fulfillment.

The Dignity of Poverty

Charles Murray presents a contrasting viewpoint by posing the provocative question: "What is so bad about being poor?" He argues that poverty does not inherently strip individuals of dignity or happiness. Murray’s libertarian perspective suggests that happiness is more closely tied to personal values and attitudes than to financial wealth. He emphasizes that financial security does not guarantee happiness, as evidenced by wealthy individuals who remain dissatisfied with their lives.

Murray's argument highlights the importance of contentment with what one has and the role of personal values in determining happiness. Individuals who prioritize material possessions and superficial markers of success may find themselves perpetually unhappy, regardless of their financial status. Conversely, those who focus on meaningful relationships, personal growth, and non-material forms of fulfillment may experience happiness even in the absence of wealth. Murray’s perspective challenges the assumption that money is a prerequisite for happiness, suggesting instead that personal values and attitudes play a more significant role.

Subjective Wellbeing

David G. Myers introduces the concept of "subjective wellbeing," which refers to an individual's personal assessment of their happiness and life satisfaction. This concept highlights the subjective nature of happiness, as each person's definition and experience of happiness may differ. Myers notes that life often involves tragedy and struggle, which can either provide meaning or become overwhelming. The extent to which money can alleviate these struggles depends on the nature of the challenges faced. For instance, financial resources may help resolve issues like debt, but they cannot compensate for emotional losses, such as the death of a loved one.

Myers also

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