Fuel for the soul
13 Nov 2017
By Shadforth Financial Group
Want to know the secret to happiness? Stop buying stuff and start buying experiences.
It’s that simple, and there’s plenty of research out there to back it up.
A study conducted by San Francisco State University found that people who spent money on experiences instead of objects felt their money was better spent. They said the joy and memories of experiences — from epic adventures to minute encounters — can last a lifetime, while buying something new provides only a short-term thrill.
One of the experiments in the study surveyed participants before and after buying something new. In the lead up to the purchase, they thought it would make more financial sense to buy a material item, even though they knew a life experience would bring them more happiness. However, their post-purchase opinion was quite the opposite. They decided that not only would happiness be greater with a life experience, but that the life experience was of more value than the material item.
Introducing ‘the love hormone’
Often referred to as ‘the love hormone’, Oxytocin is a neurotransmitter that’s mainly produced in the brain. When released, you feel a sense of social connection, bonding, trust, generosity and overall happiness. It really kicks into gear when you hug someone you love or... you picked it... buy something new.
The problem is when you buy something this feeling of happiness fades quickly. But when you experience something new, ‘the love hormone’ reaches a whole new level.
In a study from Stanford University School of Medicine, researchers revealed oxytocin is involved in a much broader range of social connections than previously thought. When released through any type of social connectivity or behaviour that reinforces human survival, oxytocin triggers the release of serotonin. The serotonin then activates the ‘reward circuitry’ in a part of the brain, resulting in an overall feeling of happiness and wellbeing.
Nothing can compare to the moment you stepped into a gondola in Venice or reached the summit of New Zealand’s Mount Cook. As fleeting as these moments might be, they create lifelong memories, longer-lasting happiness and reinforce social connections with others — all essential elements of living life and being human.
The experience economy
We might have once been buying new possessions as a source of happiness but the tide is changing. A recent Roy Morgan study found that as a nation we’re spending more on things like holidays and restaurant dinners than material possessions.
Over the past seven years, the amount we’ve spent on going out has increased by 38%, while the money we’ve spent on clothing has only increased by 20%. And, the gap between experience and possession spending appears to be widening. The ‘experience economy’ is becoming a real thing.
Top three reasons to choose experiences over stuff
According to a study conducted by the Princeton Neuroscience Institute, when our living space is filled with clutter it can increase our stress levels and actually end up harming our mental health. Researchers found that physical clutter negatively impacts our ability to focus, causing chaos in the brain.
2. The thrill will fade
New things are exciting at first. But before too long they become part of our daily lives and we’re left eagerly seeking an upgrade. This was the hard-hitting finding from a 20-year study conducted by Cornell University.
The study found that experiences like travel, trying that new restaurant around the corner or finally booking tickets to see your favourite band become a part of our identity, and bring us greater overall satisfaction.
3. Experiences open your world
Experiences broaden our world, and our minds. They introduce us to new perspectives, life lessons and different cultures. What’s more, they can even open up our social circles and strengthen our relationships, as the Stanford University School of Medicine study supports.
Whether you travel through Europe together, share an evening at the theatre or do a cooking class, a bond is formed during shared experiences. And as the years go by, those encounters become a part of the stories we tell.
The buying decisions you make not only affect your bottom line but also your levels of happiness. Your Private Client Adviser can help you make smart investment choices.