It’s generally assumed that greater wealth leads to happiness. In fact, several studies have tried to pinpoint the magic income level for happiness, including the oft-cited Princeton University study published in 2010 that found that happiness rises as income rises up until you hit $75,000 a year — at which point happiness doesn’t improve as you earn more. A more recent study conducted by Purdue University in 2018 found that $75,000 is still the target income for emotional well-being, but for true life satisfaction, the ideal income is $95,000.
But instead of wealth leading to increased happiness, the opposite might be true: Happiness leads to greater wealth, and several studies support this idea.
For example, a research paper published in the Proceedings of the National Academy of Sciences of the United States of America found that adolescents and young adults who report higher life satisfaction earn significantly higher levels of income later in life.
So, do you want to boost your happiness in order to perform better at work and increase your personal wealth? If so, you need to get a better idea of why happy people are able to earn more money.
Happy people take an optimistic approach.
Employees who are happy tend to earn more money because their optimistic approach makes them more open to opportunity and new experiences, said Lynda Spiegel, a human resources professional and founder of career coaching and resume writing service Rising Star Resumes.
“They are willing to accept challenges and take risks, both of which are predictors of greater earning opportunity,” she said. And, they view bad decisions as a learning opportunity rather than a personal failure, she added.
Happy people have fewer sick days.
Happiness might play a role in overall well-being. Happy employees tend to spend more time working and less time out of the office on sick leave.According to research published in Illinois Wesleyan University’s “The Park Place Economist,” happy employees stay home 15 fewer days a year, on average, than unhappy workers — and live up to 10 years longer.
Happy people are more productive.
Researchers at the University of Warwick in Coventry, England, found a link between happiness and productivity. In their paper “Happiness and Productivity,” economics professors Andrew Oswald, Eugenio Proto and Daniel Sgroi write that randomly selected individuals who were made to feel happier had up to 12 percent greater productivity than those who were not.
Being productive at work has obvious benefits. If your boss notices your productivity, it puts you in a better position for a promotion and salary increase.
Happy people get better performance reviews.
“Happiness is contagious,” said Idowu Koyenikan, author of Wealth for All Africans and principal consultant at Grandeur Touch, a business strategy and human resources consulting firm. “It rubs off on your co-workers and, most importantly, your customers.” For this reason, happy people tend to get better performance reviews, which typically lead to higher pay, he said.
Employers also want happy people on staff to boost morale and promote a good work environment, said motivational speaker Dan Stotridge. “This in and of itself gives happy people an edge on the competition because the employer will want to do all they can to keep these people on staff, resulting in pay increases, promotions, benefits and more,” he said.
Happy people are part of the solution, not the problem.
Most people like to be part of the problem by complaining about what’s wrong with the workplace, the boss or co-workers, said Linda Talley, a behavioral theorist and leadership development coach. Happy people, on the other hand, tend to look for solutions to problems.
“This confidence and solution-oriented behavior is invaluable to the busy workplaces because it translates to increased productivity and results,” said Lior Krolewicz, founder and CEO of Yael Consulting, a marketing consulting firm.
Happy people invest in themselves.
Happy people earn more because they are always improving themselves by learning more, exercising and investing in their future, said Elle Kaplan, CEO and founder of investment firm LexION Capital.
And investing in yourself can boost happiness as well. “I’ve noticed that my clients are generally happier overall when they invest,” Kaplan said. “This is because investing in yourself is one of the best things you can do for yourself,” she said.