Some studies suggest that income contributes to happiness to a certain extent. However, an 80-year Harvard University study reveals that personal relationships are the true key to a fulfilling life.

According to Dr. Jordan Grumet of the University of Michigan and Northwestern University, the wisest way to spend money for genuine happiness is to allocate it to three areas: material possessions, experiences, and self-improvement.

Spending on material possessions is more complex than we think. While spending on basic needs like food, shelter, and security doesn't typically bring noticeable joy, their absence can lead to unhappiness.

Conversely, material desires like luxury cars, beautiful houses, and the latest gadgets, while seemingly promising happiness, often have the opposite effect.

Neuroeconomics research shows that buying material goods only provides a short-term dopamine rush. We quickly revert to our baseline emotional state. Psychologists call this hedonic adaptation, a cycle where the pursuit of material possessions keeps us constantly chasing but never truly reaching fulfillment.

In 2020, researcher Amit Kumar and colleagues discovered that spending on experiences like vacations or concerts brings greater happiness than buying material goods. This benefit extends even to the anticipation of the experience. Experiences also foster stories, identity, and social connections, which continue to provide long-term benefits even after the initial joy fades.

However, there's a caveat. While a luxurious trip might feel amazing, repeating it 10 times a year diminishes its impact. Experiences, like material possessions, lose their appeal when overconsumed without balance or deeper meaning.

When you invest in becoming a more well-rounded, purposeful version of yourself, you're not just pursuing pleasure but investing in personal growth.

If you enjoy writing, invest in a writing class. If you love adventure, perhaps embark on a journey to a new place. When spending nurtures purpose and passion, it naturally attracts others to you. The Harvard study showed that these human connections form the foundation of happiness.

Becoming a successful person doesn't necessarily require a lot of money. You can spend a fortune on expensive programs or trips, but it's not essential. Growth often begins with small, inexpensive steps. A pair of running shoes and a new trail, a community class that sparks a hidden talent, these can be the starting points.

In other words, the most meaningful investments in yourself are often less expensive than you think.

Thuy Linh (Theo Psychology Today)