Can money buy happiness? Research says yes, but not by spending on yourself. It’s generosity that delivers the biggest emotional return.
Before we get into the science, let’s clarify what we mean. According to the University of Notre Dame’s Science of Generosity Project, generosity is "the virtue of giving good things to others freely and abundantly."
This might include time, attention, resources, encouragement, or emotional support. It’s not limited to financial gifts; it’s a mindset and lifestyle that focuses on the well-being of others.
And here’s the paradox: When we give, we often gain. Not in material terms, but in happiness, meaning, and satisfaction.
The Greater Good Science Center at UC Berkeley, in partnership with the John Templeton Foundation, studied how generosity affects well-being. One key study (Dunn, Aknin, & Norton, 2008) found that people who spent money on others reported significantly higher happiness than those who spent it on themselves.
And the effect wasn’t just short-term. In follow-up studies, participants who recalled giving experiences felt happier and were more likely to give again, creating a reinforcing loop of generosity and joy.
Even young children respond this way. Toddlers under age two, according to another cited study, were happier giving away treats, especially when it involved a personal sacrifice.
If you’re already financially successful, as a physician, dentist, executive, business owner, or retiree, you’ve likely moved beyond the basic comforts that wealth provides. The next step often involves asking a deeper question: How can I make my wealth more meaningful?
Accumulating wealth brings security, but its emotional payoff eventually plateaus. Giving, however, activates the brain’s reward centers — the same areas triggered by food, social bonding, and joy.
A 2006 study by Harbaugh et al., cited in the Berkeley report, even found that mandatory giving lit up the brain’s pleasure regions, though voluntary giving had an even greater effect.
Bottom line: We’re wired to feel good when we give.
Generosity connects us to powerful forces that enhance well-being:
You may notice an immediate emotional return, but the ripple effects can extend through your family, business, and broader community.
Yes. Studies consistently show that spending money on others leads to greater happiness than spending on oneself.
It activates areas in the brain linked to pleasure, social connection, and purpose.
Yes. Helping others can reduce stress and improve both mental and physical well-being.
Generosity isn’t just good for the world — it’s good for you. If you’re searching for more meaning or joy in your financial life, the answer might be in what you give, not what you keep.
You don’t need to start a foundation to experience the benefits of giving. Try something simple:
Even better? Do it anonymously and pay attention to how you feel afterward.
Whether it’s gifting appreciated stock, setting up a donor-advised fund, or aligning your giving with your long-term goals, our advisors can help you make generosity a meaningful part of your strategy.
Request a free discovery call with our team to get started.
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Shane Tenny, CFP®, is Managing Partner of Spaugh Dameron Tenny, where he helps high-net-worth individuals and families navigate complex financial decisions with clarity, structure, and confidence. Since joining the firm in 2000, Shane has worked with clients through major financial transitions, including career changes, liquidity events, retirement, and multigenerational planning. His approach combines comprehensive financial planning with a focus on behavioral finance, including advanced studies in Behavioral Economics through the University of Chicago Booth School of Business. Shane is the author of Your Next Million, former host of the Prosperous Doc® Podcast, and a nationally recognized financial advisor, speaker, and educator.
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