#INVESTOR BEHAVIOR
In 2010, a famous study concluded that money stops buying day-to-day happiness past a certain threshold. Thirteen years and two studies later, the answer turned out to be more nuanced — and different for most people.
Published on August 23, 2026
In 2010, Daniel Kahneman and Angus Deaton (Princeton, PNAS) published a study that became a reference point: above roughly $75,000 in annual income, day-to-day emotional well-being would stop rising, even though overall life satisfaction kept climbing. In 2021, researcher Matthew Killingsworth (Wharton, PNAS) revisited the question with a different method — over 1.7 million real-time well-being reports from an app, covering 33,391 employed adults — and found no plateau at all: well-being kept rising linearly with the logarithm of income, with no slowdown above $75,000. Facing this disagreement, Kahneman and Killingsworth ran a 2023 'adversarial collaboration' with Barbara Mellers (Wharton): reanalyzing Killingsworth's data together, they showed that well-being does keep rising with income for most people, with no identified ceiling, and even accelerates for the already-happiest group. But for an unhappy minority (roughly 20% of the sample), well-being does stop rising past about $100,000 a year.
Does money stop buying day-to-day happiness once a certain income threshold is crossed?
It depends who you ask: for most people, no, well-being keeps rising with income; for an unhappy minority, yes, a ceiling does exist, around $100,000 a year.
In other words: the famous $75,000 ceiling never applied to everyone: it mostly described what happens among the unhappiest people, not the majority of the population.
Three caveats, because they matter
- The 2010 study's apparent ceiling was partly a ceiling effect in the measurement tool itself: past a certain self-reported happiness level, the scale could no longer distinguish additional degrees of happiness.
- All three studies use American samples with different measurement methods (retrospective recall in 2010, real-time sampling in 2021 and 2023): the dollar thresholds are not strictly comparable across studies.
- The emotional well-being measured here (day-to-day mood) is not the same as overall life satisfaction (a retrospective judgment about one's life), which kept rising with income in all three studies, ceiling or not.
Why it still matters: citing the $75,000 threshold as a universal truth about money and happiness ignores that the most recent research reserves it for an unhappy minority — for most people, the relationship between income and well-being doesn't stop anywhere in the available data.
For you
- Did you picture the link between money and happiness as capped at one precise threshold?
- Does the distinction between daily well-being and life satisfaction change how you judge the effect of money on your own life?
Source: Kahneman & Deaton, 'High income improves evaluation of life but not emotional well-being,' PNAS, 2010; Killingsworth, 'Experienced well-being rises with income, even above $75,000 per year,' PNAS, 2021; Killingsworth, Kahneman & Mellers, 'Income and emotional well-being: A conflict resolved,' PNAS, 2023.
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