Have you ever thought about what the perfect income would be for you per year? Would it be $40,000? $100,000? $500,000? How much money do you think you would need to be happy? Believe it or not, there was a survey performed on this very topic. Gallup did some research and gauged day to day happiness based on yearly salaries. Obviously, a family income of $30,000 did not offer too much in the way of happiness. From this point, the higher the income, the higher the day-to-day happiness. It only made sense.
However, at some point the income gets high enough where the day-to-day happiness hardly increases. At this point is the perfect income amount. So what is the magic number? According to Gallup, the perfect income for happiness is $75,000.
My Experience with a $75,000 Income
In my short career I have experienced a wide variety of incomes. When I first started working after college, I earned about $34,000 a year. I have to say, this was not enough for the highest point of happiness. Sure, I was able to get by from month to month and still have some extra cash to put into savings, but it would have definitely been nice to earn more.
Later in life (after I was married) I earned much more at my job, I created a large income with my online ventures, and my ex earned quite a nice income as well. All together, we earned about $125,000 a year. Honestly, it was too much. We had more fights about money than we ever did before, simply because we both had different opinions about where the money should go. I, of course, wanted to put it into investments and pay off our debts. She seemed quite content with spending it on food, clothes, and vacations. Ultimately, this difference lead to our separation. If we made less money, we may have actually been more happy.
At another point in my life, I earned almost exactly $75,000 a year. Things were good. There was plenty of extra money to grow the savings account and I never felt guilty about taking a vacation or two during the year. It was a nice income that I would have been content with for many years to come.
Can You Actually Earn Too Much Money?
I mentioned earlier that $125,000 was too much money, but is it actually possible to earn too much? In my opinion, it all depends on where your heart is. If you find yourself continually wanting more stuff or hoard all of your money, then the more you earn the more discontent you might become, thereby decreasing your happiness. However, if you handle your money well and enjoy giving it away when you have an overabundance, then earning more money probably won’t impact your happiness in a negative way.
In my life, I still aspire to earn more than $75,000 each year, but I have learned not to spend all this money on random stuff for today. Instead, I have been making an effort to pay off my debts, to give to others, and to invest more heavily than before. These actions will provide me options in my future life, which will then increase my happiness to a whole new level.
What is your perfect income number? Is there an income amount that is just too much?
Pay Down Debt or Leverage Up to Buy More Property? – by Financial Samurai
Misadventures of Niche Site Building – by Retire by 40
My Monthly Income Stream Report: March 2014 – by Beat the 9 to 5
5 Ways to Reduce Your Feed Expenses – by Narrow Bridge Finance
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.