When considering how to spend your money, you’re likely to consider material purchases more valuable than experiences you have to pay for, such as a nice dinner out. But new research (paywall) shows that, after the fact, you’re more likely to value the experiences more highly than objects you purchased on just about any measure.
When asked to consider their happiness, study participants said they’d spend money on experiences like vacations. But they still thought it was more financially sound to buy a gadget or new clothes.
When ranking purchases they’d already made, however, those surveyed recalled experiences as both making them happier and being a better use of their money. “We naturally associate economic value with stuff,” study author Ryan Howell said. “I bought this car, it’s worth $8,000. We have a harder time estimating the economic value we would place on our memories…There was just huge underestimates in how much value people expected to get from their purchase.”
Sometimes the best experience is the act of buying something for someone else. Several researchers have noted a connection between altruistic spending and happiness. Giving up all of your new electronics in favor of trips to the beach and charitable acts might not seem fun or sensible. But if you’re lucky enough to choose between indulging in an object or in a memorable experience, the latter might leave you more content in the end.