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$176,500: How much Aussies need to earn to be happy

Lucy Dean
·3-min read
Shot of a mature couple enjoying a relaxing boat ride
Are you this happy? Image: Getty.

“Money, money, money

Must be funny

In the rich man's world

Money, money, money

Always sunny

In the rich man's world.”

So sang Anni-Frid Lyngstad in ABBA’s 1974 hit, Money, Money, Money.

And according to new research, while you don’t need to be a man to be happy, you certainly need to be raking it in.

In fact, the price of happiness in Australia is a huge $176,500 a year, according to financial education website Expensivity.

It analysed existing research on the cost of happiness around the world from Purdue University, before adding in the cost of living in each country.

“A reliable, comfortable income salves your worries and just makes life easier. Poverty is stressful and leaves long-term damage. The illusion that wealth is meritocratic deprives low-earners of their self-esteem,” Expensivity said.

“This is why the money it takes to make you happy can be counted in the tens-of-thousands, rather than the millions.”

Australia is the second-most expensive country to achieve true happiness, only one spot behind Bermuda where it costs $188,760 a year to achieve happiness.

These are the 10 most expensive countries to achieve happiness:

  1. Bermuda – $187,000 per year

  2. Australia – $176,500 per year

  3. Israel – $170,100 per year

  4. Switzerland – $168,200 per year

  5. New Zealand – $168,000 per year

  6. Norway - $149,698

  7. Denmark - $143,134

  8. Japan - $141,094

  9. Iceland - $140,785

  10. United States - $137,702

In Australia, the average weekly ordinary full-time earnings are $1,711.60, in the 12 months to November 2020. Over the course of a year, that's $89,003.20.

The study comes after the University of Pennsylvania’s Wharton School found that people’s happiness increases with the amount of money made.

While another study from 2020 found money only increases happiness up to a US$75,000 a year income, before plateauing, the Wharton School study found there’s no point where the happiness gained slows.

Generally, happiness isn’t actually attached to the money itself, but the freedom it grants, Wharton School senior fellow Matthew Killingsworth said.

“People living paycheck to paycheck who lose their job might need to take the first available job to stay afloat, even if it’s one they dislike. People with a financial cushion can wait for one that’s a better fit,” he said.

“Across decisions big and small, having more money gives a person more choices and a greater sense of autonomy.”

However, the same study noted that those who equated money with success weren’t as happy as those who didn’t.

And there was a tradeoff - those who earned more felt they lost time.

As Anni-Frid sang: "All the things I could do if I had a little money."

Want to earn more money and become happier?

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Image: Yahoo Finance
Image: Yahoo Finance