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Research has found that there are several things that make people happy.

Scientists have also discovered that most people don’t do a good job of predicting what will make them happy. In this lesson, we’ll look at what causes happiness, the relationship of money to happiness, and how accurate people are at making predictions about happiness.

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What Makes People Happy?

Think about a time when you felt particularly happy.

What was it that made you happy? Was it because you had loved ones near? Because you were surrounded by a beautiful landscape? Because you had just accomplished something important? Or were you happy because you had lots of money?’What makes you happy?’ That seems like a simple question, but the truth is that many people don’t know. Or, as psychologists have discovered, they think they know the answer, but really don’t. Psychological research on happiness has identified several things people have in common: the types of things that make them happy, the things they think will make them happy, and the differences between the two.

Let’s start by looking at what actually makes people happy. As you might expect, research shows that the best indicator of a person’s happiness is the quality of his or her close relationships. Whether you’re talking about romantic relationships, family dynamics, or simply close friendships, the happier you are in your social engagements, the happier you are in general.

Quality relationships are the factor most likely to lead to happiness.
Relationships Make People Happy

Besides close relationships, there are two other things that predict happiness in people: having a job or hobby that they love and that challenges them and helping others through volunteer work, random acts of kindness or another type of prosocial behavior.All three of these things make sense.

I’ll bet you weren’t very surprised that solid relationships, engaging ways to spend your time and prosocial behavior all contribute to happiness.

Materialism and Happiness

But what about money? After all, if you don’t have any money, it’s very easy to believe that lots of money will make you happy. But that’s not what psychologists have found.Once your basic necessities are met, research has shown that additional money does not have a lot to do with happiness. So, while billionaires may fly on private jets to luxurious spas all over the world, it doesn’t mean that they are any happier than people who drive 10-year-old cars and fly coach.

However, focusing on money and material things can make you profoundly unhappy. Research has shown that people who put a lot of emphasis on money and things are not as happy as non-materialistic people.

Affective Forecasting

The things that make people happy and unhappy seem pretty intuitive.

But do people really understand what makes them happy?Affective forecasting is the process of guessing how you will feel under specific future circumstances. Affect is just another word for emotion or mood. If I said that tomorrow you were going to lose your job, break up with your partner and fail a test, I’ll bet you could pretty accurately predict what your emotional state would be.But how effective are people at affective forecasting when it comes to happiness? Not very; research has shown that most people make consistent errors when guessing what will make them happy in the future.

Think about this: if you could either be a powerful CEO of a large company, making tons of money, or work part-time at a small company, barely making enough to cover your bills, which would you choose? Which do you think would make you happier?If you’re like most people, you probably said making lots of money would make you happier. But, as you might have guessed from the research on money and happiness, that’s not the case for most people. When you think more deeply about the jobs, you’ll realize that a CEO of a large company might make a lot of money, but she also works very long hours at a stressful job.Compare that to the part-time job where bills are being paid, but there’s not a lot of extra money left over for luxuries. However, at a part-time job, you’ll have more time to spend with your loved ones.

In reality, psychologists have found that less money and more time with loved ones tends to make people happier, as long as basic necessities are being taken care of. However, most people make errors in affective forecasting because they will choose things that are unlikely to make them happy (such as a lot of money) over things that have a high likelihood of making them happy (such as time with family and friends).There are many theories why people are not effective at affective forecasting. Some psychologists believe that the problem is with the impact bias, where people believe that something will have more of an impact on your emotions than it actually will.

Others believe that the issue lies in the projection bias, which is when you project your current wants and desires onto the future. Other theories as to why people are not good at guessing what will make them happy in the future include the tendency to not think about the concrete details of a situation that might happen in the future and the tendency to forget your reactions to things in the past.

Lesson Summary

There are three main things that make people happy: close relationships, a job or past-time that they love and helping others. On the other hand, money and material things do not have a lot to do with happiness, and people who emphasize them are less happy than those who do not. No matter how intuitive these things seem, people make affective forecasting mistakes all the time by making decisions based on things that are unlikely to make them happy, such as making a lot of money, instead of based on things that will make them happy, such as spending time with loved ones.

Learning Outcomes

After completing this lesson, you should be ready to:

  • Identify the three main things that tend to make people happy
  • Discuss what people think will make them happy versus what actually makes them happy

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