How Much Money Is ‘Enough’ to Make You Happy

There’s no concrete consensus as to how much happiness a bigger income can buy. After a certain point, the pursuit of additional financial resources is not about money at all, but what it might symbolize. But what exactly does it symbolize? Is it possible to be both ambitious and satisfied?I spoke with financial therapist Lindsay Bryan-Podvin to better understand how individuals can define “enough” for themselves and find balance in their financial lives.

“More” isn’t always more

It’s natural to think of financial “enoughness” as the solution to all of our life’s stressors. “For many of us, our bank account or net worth is a visual symbolization of how we measure our self-worth,” Bryan-Podvin explains. Because it’s so tricky to quantify our inherent value, “we often equate it with the digits in our bank accounts, the balance of our retirement funds, or the value of our assets.”

However, assigning metrics to our self-worth leads to diminishing returns. In other words, more isn’t necessarily “more” in terms of our happiness. Bryan-Podvin points out there is a now debunked study that surmised that after a salary of $70k/year (more like $90k with inflation), a person’s happiness doesn’t increase with additional income earned. Nevertheless, when it comes to our happiness, many of us falsely believe that if we had more money, certain good things would happen. Bryan-Podvin gives some examples of the sort of thinking she sees in her financial therapy practice: “If I had more money, I’d be physically healthier,” or “If I earned more, I’d have a closer friend circle.”

At the same time, “it’s fair to say that when individuals have enough to go beyond financial survival, they tend to experience greater well-being,” Bryan-Podvin contends. It’s about more than just covering necessities; it’s about enjoying life’s little luxuries—dining out, travelling, and indulging in the comforts that support our version of a content life.

How to define “enough” in your financial life

Reflect on what “enough” means to you personally, aligning your financial goals with your values and priorities. Bryan-Podvin suggests starting by separating your self-worth from your finances. Write or say, “I’m more than what I have or own,” or “My net worth doesn’t define me as a person,” to practice that separation. Assess the other domains of wellness, (physical, emotional, environmental, occupational, social, self-growth/intellectual, and spiritual) to see what you might actually need to tend to. 

Journal and reflect on what “enough” means to you personally. For some, it might be a monthly dinner date, for others, it might mean being able to pay for a child’s summer camp in full. Then, figure out the actual cost associated with that “enoughness.” This can also serve as a way to be creative: Maybe you can’t afford an additional date night each month, but you have friends who’d be interested in doing a “date night at home,” where you take turns cooking for each other.

Finally, to define “enough” in your financial life, you need to understand your current spending habits. Calculate your annual expenses and add a buffer—perhaps 10-20%—and see what you can do to increase your income or decrease your expenses to get there.

After basic needs are met, more money tends to be spent on wants rather than needs. The happiness gained from extravagant vacations, flashy cars and expensive homes offers less of a lasting impact than the happiness that comes from pursuing goals, relationships and community. Money can buy a lot, but it can’t buy meaning.

The amount of money needed for happiness depends heavily on the individual—your goals, values and lifestyles preferences. But focusing less on amassing possessions and status items and more on fostering meaningful relationships, pursuits and generosity is likely the best formula for turning money into happiness. Striking the right balance requires reflection on what matters most to you.