How Does Wealth Affect Happiness
Most people think that the richer they are, the happier they become. However, evidence shows that this isn’t necessarily the case. In fact, recent studies have shown that the more money you have, the more likely you are to suffer from depression and other mental health problems.
A recent study pointed out that once a certain annual income has been reached (a sum of $105,000 in the USA and $95,000 on average around the world), we are more likely to have worse life satisfaction and reduced well-being.
Even more interestingly, it isn’t only adults who feel the impact of this phenomenon. Children of affluent parents are also more at risk of suffering from anxiety, substance abuse and depression than those coming from less well-off families.
So, why are rich people more likely to be depressed? How does wealth influence depression? Let’s take a closer look.
More Money = More Wants
Once you’ve got sufficient income to meet your basic needs and buy any small treats or repay your debts, the extra money you have in the bank simply serves to fuel your desires. You end up pursuing more material items and, in the long-run, these only serve to reduce your well-being.
This is a phenomenon known as the “treadmill effect”. We tend to believe that material items that we purchase make us happier. However, once we’ve acquired them, we begin to wonder what we can buy next. Of course, the next purchase must be better and bigger than the last, and it has to be more than others around us have.
While this all sounds like a positive thing, there is a lot of research out there to show that the majority of material things we possess don’t actually make us happy at all. Instead, the things that drive our happiness are experiences – having enough time to enjoy the things that we love and to spend with loved ones. The greatest pleasures we can find are from warm relationships, interpersonal live, appreciation, gratitude and giving.
More Money Leads To Greater Isolation
The further up the income ladder we progress, the more isolated we can become. The more wealth we acquire and the more possessions we own that indicate we are of a higher status, the more we begin to distance ourselves from other people. Perhaps this is due to selfishness and feeling competitive, or maybe it’s because there is no need of other people to help us survive in the same way as poorer people need the help of others. Whatever the reason, the more wealth we have, the less socially connected we are and the less we value those connections. This, in the end, eats into the sense of well-being that we experience overall.
More Money Means More Work
At one time, rich people were known as being the leisure class. This, however, is no longer the case. Rich people in the USA work for longer than those on lower incomes. In just one generation, the wealthy have reduce the amount of leisure time that they enjoy exponentially. Another contributing factor is that working for longer hours is considered to be a rite of passage for those who aspire to higher wealth, and richer people feel obliged to commit to a punishing work schedule. While work can provide greater life satisfaction, if we work for incredibly long hours, we can’t do the things that have been proven to make us happier, such as spending time with family and friends. Also, jobs that pay higher salaries also come with greater stress and more responsibility. All of these factors add up to reduced life satisfaction and a greater incidence of depression.
Entrepreneurship Is Linked To Depression
The relationship between depression and entrepreneurship has been studied, and the results have shown that around 50% of all entrepreneurs have experienced a mental health problem at some point. This could be due to the personality traits and characteristics that most entrepreneurs display – extroversion, creativity, a propensity for risk-taking and open-mindedness are all traits that are commonly found in those with depression too. It’s no wonder, then, that the most successful people in society often get depressed.
There are several reasons for this:
- Entrepreneurs compare themselves constantly to other people in their field and their colleagues, and measure their own self-worth against those who seem to be most successful.
- Entrepreneurs are significantly disconnected from life’s simple pleasures since they become consumed 24/7 with their business needs. Even when they’re physically present they are often not emotionally or mentally in the same place as their loved ones.
- Entrepreneurs feel detachment from their former self. This is especially the case when success and wealth happens suddenly. It catapults the entrepreneur into a different type of lifestyle and they can struggle to find happiness in it.
- Entrepreneurs are often privileged from birth and this makes them less likely to be resilient against the challenges that life presents to them. Should difficult times arise, they simply lack the necessary skills to weather them. Meanwhile, those who have had a challenging childhood are more likely to develop coping skills that make them resilient in the face of adversity.
- Some industries like technology and finance tend to be highly competitive. This contributes to depression too, particularly for quiet, deep thinkers.
- When you’ve achieved the goals and aspirations that you’ve set for yourself and still have failed to achieve happiness, emptiness can set in. When someone is financially successful and reaches a key milestone, they are more likely to experience depression since they have to reassess their values.
Biochemicals And The Brains Of Successful People
While the reasons above are all relevant, there may be some biochemical considerations to take into account when it comes to the brains of highly successful and wealthy people. High-powered people are more prone to depression and other mental health disorders because the qualities that lead to an individual being an effective leader are also factors that lead to mental illness.
Success and work often supply a high that is addictive over time. While someone who lacks addictive biochemistry can easily walk away from their job when the working day comes to an end and relax to enjoy family time, addicts and depressives (like those in the most high-power jobs) find that they need more stimulation over time to simply feel normal. When they work late at night, they are feeding the same brain centers as those that would be stimulated by taking drugs or drinking excess alcohol.
Overcoming Depression In The Wealthy
Since studies have shown that wealthy people, and especially those who have suddenly become wealthy because of an inheritance, because of a lottery win, or through the sale of a successful business, often fail to achieve happiness when they have become rich. In fact, a significant number of them come to believe that their new-found wealth actually creates more problems than those that it solves.
So, how can depression in the wealthy be overcome?
The key is to build momentum.
Extremely successful people have determination, energy and creativity as key elements of their personality. They can, therefore, put those traits towards their own recovery. By tapping into the same skills that enabled them to create a successful business, they can overcome their depression effectively.
Extremely successful people are skilled at setting goals for themselves and achieving those goals. This is very beneficial when it comes to succeeding at therapy. They are ready to put the effort into working out the cause of their problems and, thanks to their intuition and intelligence, they are more able to rapidly identify the issues and traumas that have caused this situation to arise.
Everyone trying to overcome depression will need to find the treatment program that works best for them. It may include medication, therapy, exercise, productive activities, yoga, meditating, or journaling. However, those who are wealthy and successful are usually creative, and this allows them to figure out the most effective treatments for them. Powerful people and executives have also had to undergo lots of problem-solving in order to achieve the success that they have achieved, and the “fake it until you make it” mentally is known to interrupt the negative thought processes that are known to feed into depression.
Luckily, as more powerful figures and celebrities are starting to admit to suffering from depression, the stigma associated with mental health disorders in the wealthy and successful is reducing. This means that sufferers are more likely to discuss their problems and to seek out the professional help that they need.
By using their own skills and strengths, wealthy and successful people can manage their depression and other mood disorders and live meaningful, full lives as long as they take the step to recognize their problem and seek out help to overcome their problem.
Lack Of Money And Depression
Although wealth is linked to depression, it’s also important to note that a lack of money has also been linked to mental illness. Evidence has shown that a quarter of people suffering from mental health disorders are also in debt. This means that there is a vicious circle of debt and depression.
It’s easy to see why living in poverty leads to depression. Meanwhile, suffering from depression’s medical effects makes financial difficulties virtually inevitable.
Money problems and depression are so closely connected that it’s hard to untangle the cause and the effect.
People who suffer from depression are more likely to struggle with dealing with money since the condition negatively affects their working memory and focus. It also limits the ability to make decisions effectively and to plan for the future, and this makes routine tasks such as handling finances insurmountable and arduous. Budgeting becomes virtually impossible, and when the sufferer is at the height of a depressed episode they simply lack the concentration and energy to keep track of where their money is going.
Furthermore, when someone is diagnosed with depression, they tend to become less motivated and this, in turn, affects their ability to stay on top of their money management.
When all of these things are combined, it’s easy to see why depression sufferers are more likely to fall behind on their payments, face penalties and miss deadlines. They often struggle to prioritize spending, can’t be bothered to shop around for a better price on everyday items and, when these issues cause further debt issues and money problems, they find it almost impossible to get out of the downward spiral.
Also, other symptoms such as impaired response inhibition propel people with depression further into debt. This means that sufferers tend to make money-related decisions without properly thinking them through. This means they’re more likely to spend more money than they can afford. When they then have to face severe financial difficulties, this feeds further into their depression and anxiety, cementing the loop.
Depression Precipitates Financial Meltdown
When someone is in debt and living in poverty, depression can be the inevitable result. Yet, the reverse is also true. In fact, depression often precipitates financial meltdown.
People who are depressed tend to take time away from work. It has been shown that mental illness in general costs Americans over $193 billion in los earnings each year. It has been estimated that between 6 and 10% of adults in the USA suffer from a mental health problem in any given year, and more than million of those are suffering from depression. With around 17 million adults in America having suffered from at least on episode of major depression in the last year, these figures aren’t too surprising. Yet, staying in employment when suffering from major depression is often extremely difficult. While some people do manage to function at work when they suffer from depression, many more find it impossible to cope with the stressors they encounter in the workplace. This is why unemployment and job loss are common amongst those with depression.
Money And Depression – Finding The Balance
It’s clear to see that having too little money or too much money can lead to mental health disorders like depression. The perfect solution is to find the right income balance to achieve happiness and satisfaction, but if this isn’t possible, it’s important to seek out professional help and counseling at a treatment facility like The Meadowglade before the problem gets out of hand.