Empowering People through Behavioral Science
Practical Tools for Purpose Purpose & Wealth Purpose & Well-Being

Finding happiness by choosing time over money

By Janina Steinmetz

 

In our daily life, all of us constantly need to decide between time and money. Some are small decisions such as whether to take the slower but cheaper bus or a faster but more expensive taxi, or whether we pay someone to mow the lawn or do it ourselves. Some are bigger decisions such as whether to take a better paying but time intense job, or whether to live in a cheaper area with a longer commute. But whether we prioritize time or money in a given situation does not only affect our immediate decisions, but also has deeper psychological consequences for our sense of purpose in life. Whereas people often value productivity and independence more when thinking about money, social connections become more important when thinking about time.

Image ©:  Karsten Seiferlin 2013

While we all constantly make decision between time and money, some of us mostly lean towards money, and others mostly lean towards time. But how does it affect our lives and well-being when we usually choose money over time or time over money? Researchers Ashley Whillans, Aaron Weidman, and Elisabeth Dunn from the University of British Columbia set out to gain some insight into this important question. First, these researchers developed a measure that could capture whether someone usually chooses money or time. Participants read about two people, one of whom usually valued money more (e.g., but living in a cheaper apartment that incurs a longer commute), whereas the other person usually valued time more (e.g., by paying more for direct flights, avoiding long layovers).  Participants indicated with whom they identified more. With this technique, the researchers made sure that participants felt comfortable stating their true preference because people did not have to worry that one answers was more appropriate than the other. Next, the researchers measured how happy felt with their lives in general. The results show that whether we value time or money can have profound psychological impact: People who valued time more than money reported greater happiness in their lives. Now, one could argue that only somewhat affluent people can afford to value time over money, whereas the poor cannot sacrifice money for time as they need to make ends meet. However, people who valued time more than money were happier even when statistically controlling for how affluent people currently were. That means that regardless of how much money we make, valuing time more than money can make us happier. Although the effect of valuing time more than money is small, in our striving for purpose every little bit of extra happiness counts.

In a similar vein, New Paths to Purpose member Christopher Hsee has found that people tend to overearn, that is, to accumulate more resources than they actually need. In his experiments, participants worked on cumbersome tasks to gain chocolate vouchers that would be void after the experiment was over. In other words, participants needed only to work on as many tasks as they wanted chocolate. However, participants nevertheless accumulated more vouchers than they actually needed and preferred to work more and let resources go to waste than to relax after they had enough. It seems that many of us value money and the accumulation of resources more than is good for us. After all, we want money because we think it will make us happier. But what if there was a more direct route to happiness? Next time you find yourself deciding between time and money, try to forego the extra money and buy yourself some time. It might make you happier than money ever will. 

 

Janina Steinmetz is a Research Professional (post-doctoral fellow) in the NPP Network, based at the Center for Decision Research at Chicago Booth.

Associated Project Theme: Practical Tools for Purpose Purpose & Wealth Purpose & Well-Being

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