spending money on holiday gifts

The Science behind Happiness and Holidays

November 27, 2018

The holiday season can bring out the best in people. Spending time with friends and family and enjoying the festive spirit seems to inspire a contagious stream of happiness in our communities. Various theories have been put forward to explain this phenomenon, many relating to the extended time off from work, the abundance of food and drink, as well as the opportunity to reconnect with family and friends.

Social science, however, may provide another answer to this question. While many of us deride the consumerism of the holiday season, research suggests there may be some benefits to our spending.

Spending money on others

Several years ago, a research team led by Elizabeth Dunn of the University of British Columbia, conducted a study exploring the impacts of how people spend their money. In this ingenious experiment, participants were given envelopes of either $5 or $20, and were given two different sets of instructions. One group was told to spend the money on them self that day and the other group was told to spend it on friends or family members.

When people were later rated on their levels of happiness, those who spent money on others experienced significant gains in happiness while the ‘selfish’ group did not.

Sign Up to Our Newsletter
Get content like this in your inbox every two weeks.

In another survey conducted by the same research team, they found that respondents who spent more of their monthly income on other people were significantly happier than those who spent less. Interestingly, the degree of ‘personal spending’ had no effect on happiness levels, reinforcing the notion that ‘buying more stuff’ for our self does not necessarily lead to more happiness. Therefore, spending money on others is not only beneficial for the receiver, but for the giver as well.

Spending money on experiences

In a study published in the Journal of Positive Psychology, Ryan Howell and Graham Hill of San Francisco State University asked a group of people to reflect on a recent purchase and rate their experience. In one group, individuals were asked to remember a monetary purchase they had made. These were defined as “physical object(s) that you obtain and keep in your possession for an unspecified period of time (e.g., jewelry, clothing, or stereo equipment).”

The other group was asked to think about an experiential purchase, which means, “acquiring a life experience—an event or series of events that you personally encounter or live through (e.g., dining in a restaurant, going to a concert, traveling, etc).”

Both groups were then asked to rate their purchases on a variety of dimensions in terms of how they felt. Overall, people who were primed to think about an experiential purchase scored significantly higher in terms of whether the purchase was considered money well spent, made them happy, or made others around them happy. The experiential purchasers also reported elevated levels of relatedness and vitality.

The Magic

As the New Year approaches, we have an incredible opportunity to spend time with friends and family and share experiences that may enrich our lives. Perhaps one of the major reasons for the magic of the season is how our spending on others increases our well-being and sense of togetherness.

This year, to further increase our happiness, we may serve us well to buy “experience gifts” for those on our list. Not only will the recipient benefit from a new (or much-loved) experience, but such purchases can also provide a sense of happiness and relatedness for the purchaser.

I wish you and your loved ones all the best in maximizing your experience of the holiday season!

Related Articles

Studies show exercising can help improve your mental health and it might ...
“Colder weather and fewer hours of daylight can really affect employees, dampening …

Craig Dowden
An engaging and inspiring coach, Craig partners with leaders and executives to work on their most important challenges. He integrates the latest findings in the science of leadership, team, and organizational excellence into his coaching and consulting work. Craig Dowden Ph.D. focuses on bridging the gap between what science knows and what business does. His firm specializes in the custom design and delivery of evidence-based leadership development programs and services.

Financial Wellness