How Spending Money On Experiences Makes Us Happier
3 MIN READ
HR Guest Contributor
March 2, 2017
If you’re reading the Blueboard blog, you’re the kind of person that places a high value on memorable experiences. Experiential rewards can make employees feel more appreciated, motivated to perform, and even positively impact your team culture. That’s the power of a great experience.
At InvestmentZen, we love memorable experiences as well. We also spend a lot of time thinking about money and how it impacts happiness. We believe that money is just a tool, preferably used to create happiness (of the long-term, healthy kind). We can’t help but notice that in our consumer culture, many of us are spending our limited money on buying stuff, like new gadgets, new clothes, or a bigger house. These things might give us a short-term rush, but aren’t fulfilling in the long-term.
We conducted research and it confirmed our suspicions - that spending money on experiences that you’ll cherish forever makes us a heckuva lot happier than spending money on material objects.
So why is that the case?
First, let’s talk about your brain. It has an amazing ability to build tolerance, scientifically called hedonic adaptation. It adapts to having something around consistently and stops appreciating it. This basically results in the excitement from the new car / smartphone / clothes that you bought quickly fading into the background after you drive it around the block a few times - after awhile, you’ll find yourself searching for the next stimulus.
That’s where experiences come in. Among the many reasons why experiences are more valuable than material things, here are our Top 4:
An experience by nature is more fleeting - It could be as short as a sunset, or going skydiving, which might only technically last a few minutes. But because they are so fleeting and infrequent, we actually tend to value them more. Experiences are so powerful that our minds find reasons to turn even bad experiences into positive ones by reframing them as a chance to grow, or proof of our ability to overcome adversity. It’s why we experience nostalgia. Giving your employees the gift of a positive experience associates their enjoyment with your company, which increases happiness much more than a cash or gift card reward would. Browse Blueboard’s most popular experiential employee rewards here (5-star massage, concert tickets, or guitar lessons to name a few).
We enjoy telling the story - We find that one of the best benefits of experiences is that they’re inherently shareable - you’ll find it’s much more interesting and comfortable to tell stories about your recent vacation, trying your hand at pottery or golf, vs. going on about your most recent shopping trip. Experiences also offer high social currency - i.e. a photo or video that will blow up your Instagram or Facebook feed - extremely effective and valuable with millennial and Gen Z employee segments. Wait, who is Gen Z? The newest generational group entering the workforce this coming June 2017; get to know them better in this blog post.
Experiences form our identity - Experiences position your passions and interests in social situations, helping to build your personal character and brand, (“Wow, you just tried kitesurfing, I’ve always wanted to do that!”) and sometimes expose vulnerability (“I’ve always been afraid of heights, but took the plunge and just went tandem skydiving”). By opening up the conversation and showing your ability to challenge yourself, grow, or discover new things, experiences become a much stronger facilitator for bonding especially when forming new relationships.
We love the anticipation - Research shows that as humans, we experience more excitement, joy and satisfaction in planning the experience than actually doing the activity itself. Trip planning gives you a much-needed distraction from work (69% of us have a habit of planning vacations during work hours), stimulates the brain from learning about new things and cultures (prepping your body for a yoga retreat, learning a few French phrases before jetting off to Paris), and gives you exciting news and conversation to share with your loved ones.
Itching for more data around why experiences are more valuable than material things? Check out our visual infographic below, and full research study online here.
About the Author
Hazel Garcia is a writer and designer at InvestmentZen who’s passionate about smart money management. She loves traveling, trying all sorts of international foods, and good classical music.