Would you be happier if you were rich?
Probably, but not nearly as happy as you’re guessing.
In his paper “Would you be happier if you were richer?” Nobel prize winner and author of “Thinking, Fast and Slow” Daniel Kahneman explains that we often fall prey to “focusing illusions.”
He eloquently defines the term: “Nothing in life is quite as important as you think it is while you are thinking about it.”
So when we think about money, it looms large and we overestimate its affect on our happiness.
Check out the chart above.
When asked how often people who made 100K+ were unhappy and how often people who earned <20K were unhappy, subjects predicted a 32% difference between the two.
They were correct that the richer people were happier — but the difference was only 12%.
For all four of the questions asked those interviewed overestimated the effect of the key variable.
This isn’t academic trivia, it’s something we all do every day and it creates a lot of unhappiness and poor decision-making in our lives.
How often do you get stuck in the tunnel vision of focusing illusions?
One more time: “Nothing in life is quite as important as you think it is while you are thinking about it.”
More on the subject from Kahneman himself, here.