We’ve all heard the phrase, “Money can’t buy happiness,” and, in spite of ourselves, we can’t help but wonder: Why not? Sometimes it seems like the answers to our problems really could be money—after all, money would provide more travel opportunities and relaxation, and less stress. Surely that would lead to happiness, right?
Of course, it doesn’t seem to work that way. After all, the things that sustain our happiness over long periods of time—love, friendship, family, companionship—cannot be bought. While we may experience short-term happiness from material goods or shopping, it almost goes without saying that an expensive coat won’t keep you happy for decades, nor will the latest iPhone model. In fact, research has shown that people who are substantially richer than others aren’t any more emotionally satisfied. One study showed that in modern America, a person who makes an average of $225,000 a year has no extra day-to-day happiness than a person who makes $75,000 a year. The reason is quite simple—once your basic needs are fulfilled, extra money only purchases things, but not love.
When (someone) suddenly strikes it rich, the impact is profound on every part of their life.
Additionally, it turns out that sudden wealth actually leads to loneliness—the exact opposite of happiness. According to a BBC article, people who become rich overnight often find the experience to be extremely isolating, resulting in immense sadness. Dr. Stephen Goldbart explains, “When (someone) suddenly strikes it rich, the impact is profound on every part of their life. It can become a painful psychological experience for some people.”
Experts say that this psychological impact is largely due to strained relationships with family and friends after a sudden increase in wealth. Some family members might treat the newly wealthy differently, or try to “ride on their coattails.” The rifts can lead to the newly rich person alienating himself or herself.
Goldbart coined a term for this experience: Sudden Wealth Syndrome. The phrase is used to explain the stress, guilt, and social ramifications of becoming rich very quickly. Goldbart has come up with four stages of SWS, almost like the stages of grief: Honeymoon Phase, Wealth Acceptance, Identity Consolidation, and Stewardship. Within the four phases, people experience a wide range of emotions and ideally end up with a mature resolution.