Are people happier when they make more money?

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Metro Manila (CNN Philippines, June 17) — It seems money cannot really buy happiness.

A new local study has found that income has little impact on happiness, the Department of Science and Technology said Wednesday in a news release.

It supported the previous claim that making more money could slightly increase one’s happiness, but there is a threshold level — a monthly income of about P20,000, the DOST said.

"Beyond that, income ceases to increase happiness," it added.

The latest research, which will soon be available on the Philippine Journal of Science website, looked at how income affected happiness in Koronadal, South Cotabato.

“The research shows that people in Koronadal, a low-income, semi-urban city in Mindanao, are generally happy even with low incomes, which is consistent with the happy poor image of the Filipino poor,” according to Rosalina Palanca-Tan of the Department of Economics in Ateneo de Manila University, who conducted the study.

“As they are already happy and content with their lives, to begin with, the increase in happiness due to income is marginal and yet somewhat negligible in the practical sense,” Palanca-Tan added.

The findings also indicate that financial security and stability, such as having savings and being debt-free, and being a member of a credit cooperative, which offers loans to help with financial needs, relatively contribute to people’s well-being.

Moreover, the results suggest programs that increase accessibility and affordability of goods and services may be more effective in making people more satisfied with their lives than direct income-augmenting projects such as the conditional cash transfer program of the national government. The program, which provides conditional cash grants to the poorest sector, had no “significant influence on happiness in Koronadal,” the research said.

The study surveyed family members who traditionally make expenditure decisions from 27 villages, with an average monthly income of P19,444, the DOST said. The monthly household income in Koronadal is close to the regional average of P20,229, but lower than the national average of P26,112, it added.

On a scale of zero to 10, the average reported happiness among the participants is 6.75, which is above the neutral score of 5, the results showed. The lowest income group, or those with a monthly household income of less than P10,000, had a mean happiness score of 6.31.