Saving Money Makes You Happier — Here’s Proof

My San Antonio - The argument over whether you should invest or pay off debt usually focuses on financial numbers, such as rates of return and interest charges. Maybe happiness should be part of the equation as well.

People with more debt were less satisfied, but lowering their debt loads didn't seem to make them much happier, says Russell James, a certified financial planner and director of graduate studies in charitable planning at Texas Tech University in Lubbock, Texas. James conducted the study with Scott Garrett, then a doctoral candidate and now a certified financial planner at Ronald Blue Trust in Houston. The pair tracked 839 adults age 50 and older for four years to measure the changes.

The researchers don't know why the investment effect was bigger but say personality may play a role. In other words, unhappy people may be more likely to get into debt.

"If a person is dissatisfied with where they are in life, maybe that makes them spend more on credit cards," James says.

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