In the previous article we spent some time discussing the foundations of this topic and we were looking at how happiness distributions are formed. Our main goal in that article was to highlight that it’s important for each of us to know where we sit on a happiness distribution, and which if life’s determinants are most important to us. From there we can make more informed decisions based on our own preferences.
This time round we are turning to the evidence to see what are the most important determinants that come up time and time again studies related to this topic. There are five main determinants (and one bonus one that we think is important) that tend to stand out (in order of importance):
Family relationships: In almost every study of the determinants of happy lives, your family relationships and your close private life are deemed to have the greatest impact on your overall happiness. Becoming divorced or seperated has a significant negative impact on your short term happiness. Although it can turn out to have a positive impact on your happiness if the separation leads to an improvement in your overall wellbeing. The evidence of the effect of having children is very mixed. Having children can increase the level of purpose in one’s life but often it leads to less pleasure due to having less free time. Typically, marriage increases your happiness and there are many knock-on effects that benefit both of your lives: you share resources, you give love towards one another, you have better sex lives than single people (more of it and more satisfying) and you tend to be healthier and live longer, on average. As we have mentioned many times, these results are averages and there will be a lot variation around these results. The variation in relationships tends to depend on the quality and stability of the relationship and this matters a lot more than just being involved in one.
Financial situation: Our financial situation can be subject to a great degree of variation depending on our circumstances. We know from extensive studies on this topic, that typically the effect of an increase in income on our happiness is positive but diminishing. There are many factors that play a role in this relationship, such as the current size of the “safety net” we have available to ourselves and how this is impacted should a financial shock occur such as becoming unemployed. If becoming unemployed severely impacts your ability to meet your mortgage payments in the coming months then it’s likely to have a bigger impact on your happiness, through increased stress, than for someone with a large safety net. Expectations matter too, if you already anticipated your wage increasing then this is likely to have a small impact on your overall happiness. Studies that have included relative income suggest that your happiness is strongly affected by who you compare yourself to. If your comparison group also receive a pay increase when you do, the impact on your happiness from this increase in income is very limited.
Work fulfilment: Employment increases our sense of purpose and makes us feel happier. In most cases it offers an opportunity for social interaction, it increases our feeling of worthwhileness and gives us a reason to get up in the morning. Therefore, it is unsurprising to find that in most studies it stands out as one of the most important determinants of how happy our lives are.
Community & friends: The quality of our community is incredibly important for determining whether we make friends, the types of relationships we have with our friends, and whether we feel safe. It is not easy to measure this accurately so typically researchers tend to focus on asking questions to participants related to trust. If we have good relationships with our friends, we should be able to trust them, and we should also feel safe too. In Japan, less than 2% of people have reported falling victim to an assault over the last 12 months, which is one of the lowest rates in OECD – despite this a large proportion of participants in the OECD better life survey rated this as one of the main priorities for their country. This would tend to suggest that for people in Japan the effect of community and safety on their overall happiness is greater than for people in other parts of the world.
Health: Both physical health and mental health have significant impacts on our overall happiness. It is an important determinant of how happy we are. Having said this, healthy members of society do tend to over-estimate the loss of happiness that people actually experience from many of the main medical conditions. The data has shown that we can adapt quite well to a drop in our physical health through changing what we tend to focus our attention on. We find other ways to obtain purpose and pleasure. Having said this, people tend to never adapt to chronic pain or to mental illness and this is why the effect of mental illnesses on overall happiness level always supersedes the affects from physical illnesses.
Leisure time: Most of us use our free time to do things that we enjoy, and this makes us happier. Having said this, often it is the case that there are many other activities that we would prefer to be doing during our free time but for one reason or another, we don’t. Essentially, we aren’t fully considering all our preferences towards different activities when we are making decisions about how to spend our free time and this leads to a sub-optimal outcome. This is why we feel that tracking your happiness through time, to get a better understanding of your preferences should lead to a better allocation of your time, therefore making you happier.