Remember when you were a kid and you couldn’t wait for school to start? Or summer vacation? Or your birthday? Or Christmas Day?
You felt butterflies in your stomach. You couldn’t sleep at night. You talked about it all the time. You kept asking your parents how many more nights there were to sleep before it was finally there.
All this anticipation is half the fun as they say, although you didn’t understand it back then of course! And even as adults, we don’t often consider anticipation as half the fun. We just want the fun, right?
Actually, fun (or the related happiness that derives from it) is not composed of two halves but can be divided in 3 parts.
- Anticipation: bonus happiness BEFORE the event
- Experience: savouring DURING the event
- Memory: remembering AFTER the event
Studies by Leaf van Boven and Tom Gilovich (here and here) have shown that anticipation (so the pre-excitement) is present in both
- material purchases: “spending money with the primary intention of acquiring a life experience — an event or series of events that you personally encounter or live through.”
- experiential purchases: “spending money with the primary intention of acquiring a material possession — a tangible object that you obtain and keep in your possession.”
However, one of those results in much more happiness than the other.
Can you guess which one?
The answer to the question of how to spend money in a happiness-maximizing way: buy experiences, not things.
The reasons for that are simple: experiences are more linked to our sense of identity, of who we are. Your hobby or travel destination defines you more than you brand of smartphone. Experiences also have a more social character as you are more likely to talk about them which increases your satisfaction level.
Material purchases are usually also more short lived too. Once you have bought the latest fashion gimmick, a new, better one hits the market and you start getting a feeling of needing to keep up.
One category of people might form the exception and be equally happy with material purchases though. They are the connoisseurs, the fans, the nerds of certain products.
Nowadays, what used to be on a black and white scale (material and experiential purchases) turns grey as products become more and more experiential. Think of purchases online classes or video games, books, musical instruments or sporting goods with which you then have experiences of improving your skills, playing and interacting with other people etc. A study reveals that experiential purchases provide as much happiness as life experiences (going to concerts, traveling etc).
And even a completely new category has made its appearance of our happiness scale: paying to not have an experience. Think of buying a house closer to your job in order not to have to commute. Or picking a hotel that is adults only (ie no kids) or has no wi-fi. Or even paying someone to clean your house and do your laundry so you don’t have to.
Does that really increase your happiness? Well, that all depends one the answer to the question:
“Will this purchase change the way I spend my time?”
Happiness is a slippery concept and very resistant to quantification. It’s also very individual.
So I would argue that the material product, experience or experiential purchase is not the happiness giver, but what each individual derives from it. I personally prefer experiences over material products (well, except books maybe and from what I learned here they belong in the grey zone 🙂 ) and will always choose travel, parties with friends and massages over the latest gimmicks and brands.
So before you buy anything with the goal to make yourself happy, ask these questions before clicking the BUY button.
- How would it rank in terms of the 3 elements of fun/happiness: Anticipation/Experience/Memory?
- Will this be part of the story I tell about myself and share with others?
- Does it tie into my identity and my values in a meaningful way?
- Will it change how I spend my time? (for ex. free up time for more experiences)
I wish you some amazing, happiness inducing experiences!!!