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March 09, 2022

How to spend your way to happiness

By Gordon Powers, Sympatico / MSN Finance

Even though it will likely extend the recession by a few weeks, my family is being very deliberate about what we purchase.

But, like most people these days, we haven’t stopped buying altogether.

Choosing between a new outfit and a pair of concert tickets? Go for the tickets, suggests a recent study on whether certain spending habits are likely to make us happier.

To see what works, University of Colorado professor Leaf Van Boven compared discretionary spending on material goods like jewellery or clothing up against experiential items like vacations or theatre tickets. Most of the people he talked to felt that getting out and doing something made them much happier than simply adding another item to their collections — even after accounting for differences in price.

Since we tend to concentrate more on the highlights, memories of our experiences actually improve with time, it seems — whereas a shoe is just a shoe. And this makes us easier to live with as well. People who brag about their possessions are a lot harder to take than those whose major crime is showing off their holiday DVDs.

Things are different, of course, if the clothes don’t really fit or the meal out is a complete bust, says Jeremy Dean, pointing to parallel research by a University of Texas team on his excellent PsyBlog. This may be because unhappy experiences live longer in the mind than purchases that turn out badly.

Whether it's experiences or possessions that count, having less money to work with still shouldn’t be much of a problem, he suggests — it just forces you to be more creative. 

If anyone’s got any suggestions on how to do that, we’d love to hear them.



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...