Chart: The Relationship Between Money and Happiness
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The Relationship Between Money and Happiness

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Charting the Relationship Between Money and Happiness

Charting the Relationship Between Money and Happiness

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Can money buy you happiness?

It’s a longstanding question that has many different answers, depending on who you ask.

Today’s chart approaches this fundamental question from a data-driven perspective, and it provides one potential solution: money does buy some happiness, but only to a limited extent.

Money and Happiness

First, a thinking exercise.

Let’s say you have two hypothetical people: one of them is named Beff Jezos and he’s a billionaire, and the other is named Jill Smith and she has a more average net worth. Who do you think would be happiest if their wealth was instantly doubled?

Beff might be happy that he’s got more in the bank, but materially his life is unlikely to change much – after all, he’s a billionaire. On the flipside, Jill also has more in the bank and is likely able to use those additional resources to provide better opportunities for her family, get out of debt, or improve her work-life balance.

These resources translate to real changes for Jill, potentially increasing her level of satisfaction with life.

Just like these hypotheticals, the data tells a similar story when we look at countries.

The Data-Driven Approach

Today’s chart looks at the relationship between GDP per capita (PPP) and the self-reported levels of happiness of each country. Sources for data are the World Bank and the World Happiness Report 2017.

According to the numbers, the relationship between money and happiness is strong early on for countries. Then later, when material elements of Maslow’s hierarchy are met, the relationship gets harder to predict.

In general, this means that as a country’s wealth increases from $10k to $20k per person, it will likely slide up the happiness scale as well. For a double from $30k to $60k, the relationship still holds – but it tends to have far more variance. This variance is where things get interesting.

Outlier Regions

Some of the most obvious outliers can be found in Latin America and the Middle East:

Latin America vs. Middle East

In Latin America, people self-report that they are more satisfied than the trend between money and happiness would predict.

Costa Rica stands out in particular here, with a GDP per capita of $15,400 and a 7.14 rating on the Cantril Ladder (which is a measure of happiness). Whether it’s the country’s rugged coastlines or the local culture that does the trick, Costa Rica has higher happiness ratings than the U.S., Belgium, or Germany – all countries with far higher levels of wealth.

In the Middle East, the situation is mostly reversed. Countries like Saudi Arabia, Qatar, Iran, Iraq, Yemen, Turkey, and the U.A.E. are all on the other side of the trend line.

Outlier Countries

Within regions, there is even plenty of variance.

We just mentioned the Middle East as a place where the wealth-happiness continuum doesn’t seem to hold up as well as it does in other places in the world.

Interestingly, in Qatar, which is actually the wealthiest country in the world on a per capita basis ($127k), things are even more out of whack. Qatar only scores a 6.37 on the Cantril Ladder, making it a big exception even within the context of the already-outlying Middle East.

Nearby Saudi Arabia, U.A.E., and Oman are all poorer than Qatar per capita, yet they are happier places. Oman rates a 6.85 on the satisfaction scale, with less than one-third the wealth per capita of Qatar.

There are other outlier jurisdictions on the list as well: Thailand, Uzbekistan, and Pakistan are all significantly happier than the trend line (or their regional location) would project. Meanwhile, places like Hong Kong, Ireland, Singapore, and Luxembourg are less happy than wealth would predict.

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Personal Finance

How Do Americans Spend Their Money, By Generation?

This interactive graphic shows a breakdown of how average Americans spend their money, and how expenses vary across generations.

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Annual Expenditure in the U.S. by Generation

How Americans Spend Their Money, By Generation

In 2021, the average American spent just over $60,000 a year. But where does all their money go? Unsurprisingly, spending habits vary wildly depending on age.

This graphic by Preethi Lodha uses data from the U.S. Bureau of Labor Statistics to show how average Americans spend their money, and how annual expenses vary across generations.

A Generational Breakdown of Overall Spending

Overall in 2021, Gen X (anyone born from 1965 to 1980) spent the most money of any U.S. generation, with an average annual expenditure of $83,357.

GenerationBirth Year RangeAverage Annual Expenditure (2021)
Silent1945 or earlier$44,683
Boomers1946 to 1964$62,203
Generation X1965 to 1980$83,357
Millennials1981 to 1996$69,061
Generation Z1997 or later$41,636

Gen X has been nicknamed the “sandwich generation” because many members of this age group are financially supporting both their aging parents as well as children of their own.

The second biggest spenders are Millennials with an average annual expenditure of $69,061. Just like Gen X, this generation’s top three spending categories are housing, healthcare, and personal insurance.

On the opposite end of the spectrum, members of Generation Z are the lowest spenders with an average of $41,636. per year. Their spending habits are expected to ramp up, especially considering that in 2022 the oldest Gen Zers are just 25 and still early in their careers.

Similarities Across Generations

While spending habits vary depending on the age group, there are some categories that remain fairly consistent across the board.

One of the most consistent spending categories is housing—it’s by the far the biggest expense for all age groups, accounting for more than 30% of total annual spending for every generation.

GenerationAverage Spend on Housing (2021)% of Total Spend
Silent (1945 or earlier)$16,65637.3%
Boomers (1946 to 1964)$21,27334.2%
Generation X (1965 to 1980)$26,38531.7%
Millennials (1981 to 1996)$24,05234.8%
Generation Z (1997 or later)$15,44937.1%

Another spending category that’s surprisingly consistent across every generation is entertainment. All generations spent more than 4% of their total expenditures on entertainment, but none dedicated more than 5.6%.

GenerationAverage Spend on Entertainment (2021)% of Total Spend
Silent (1945 or earlier)$2,0274.5%
Boomers (1946 to 1964)$3,4765.6%
Generation X (1965 to 1980)$4,6945.6%
Millennials (1981 to 1996)$3,4575.0%
Generation Z (1997 or later)$1,6934.1%

Gen Zers spent the least on entertainment, which could boil down to the types of entertainment this generation typically enjoys. For instance, a study found that 51% of respondents aged 13-19 watch videos on Instagram on a weekly basis, while only 15% watch cable TV.

Differences Across Generations

One category that varies the most between generations and relative needs is spending on healthcare.

As the table below shows, the Silent Generation spent an average of $7,053 on healthcare, or 15.8% of their total average spend. Comparatively, Gen Z only spent $1,354 on average, or 3.3% of their total average spend.

GenerationAverage Spend on Healthcare (2021)% of Total Spend
Silent (1945 or earlier)$7,05315.8%
Boomers (1946 to 1964)$6,59410.6%
Generation X (1965 to 1980)$5,5506.7%
Millennials (1981 to 1996)$4,0265.8%
Generation Z (1997 or later)$1,3543.3%

However, while the younger generations typically spend less on healthcare, they’re also less likely to be insured—so those who do get sick could be left with a hefty bill.

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Money

Mapped: The World’s Billionaire Population, by Country

Collectively, worldwide billionaire wealth is nearly $12 trillion. This map breaks down where these 3,311 billionaires live around the globe.

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Visualized: The World’s Billionaire Population

The world’s billionaires—only 3,311 individuals—represent almost $11.8 trillion in wealth. The global billionaire population continued to grow in 2021, increasing by 3%. Over the same period, billionaire wealth also increased by 18%.

This map uses data from the Wealth-X Billionaire Census to visualize where the world’s billionaires live and breaks down their collective wealth.

Note on methodology: The report uses proprietary data from Wealth-X. Billionaire status is determined by assessing an individual’s total net worth, including publicly and privately held businesses and investable assets. To determine a billionaire’s location, Wealth-X used their primary business address.

Billionaires by Region

We’ll begin by zooming out to look at how various continents and world regions rank in terms of their billionaire population.

North America is home to most billionaires, worth $4.6 trillion. The U.S., unsurprisingly, accounts for the majority of this wealth, with 975 billionaires and a collective net worth of $4.45 trillion.

RankRegionNumber of billionairesCollective Billionaire Wealth
#1North America1,035$4.6 trillion
#2Europe954$3.1 trillion
#3Asia899$2.9 trillion
#4Middle East191$519 billion
#5Latin America and the Caribbean146$465 billion
#6Africa46$104 billion
#7Pacific40$89 billion

In regional terms, Europe’s billionaire wealth is growing the fastest, up 22% year-over-year in 2021. In contrast, the year-over-year change in the Middle East was -12.5%.

Asia is inching towards Europe, holding almost a quarter of all billionaire wealth worldwide, compared to Europe’s 26.5%.

Wealth in Africa will also be important to watch in coming years. Although only home to 46 billionaires currently, the change in billionaire wealth increased by almost 17% year-over-year. Additionally, while they no longer live there, a number of the world’s billionaires hail from African countries originally.

Billionaires by Country

Now, let’s look at the ranking broken down by the top 15 countries:

RankCountryNumber of BillionairesCollective Billionaire Wealth
#1🇺🇸 US975$4.45 trillion
#2🇨🇳 China400$1.45 trillion
#3🇩🇪 Germany176$602 billion
#4🇮🇳 India124$384 billion
#5🇬🇧 UK120$266 billion
#6🇭🇰 Hong Kong SAR114$287 billion
#7🇨🇭 Switzerland111$365 billion
#8🇷🇺 Russia107$475 billion
#9🇸🇦 Saudi Arabia71$192 billion
#10🇫🇷 France68$294 billion
#11🇮🇹 Italy68$207 billion
#12🇨🇦 Canada60$131 billion
#13🇧🇷 Brazil52$159 billion
#14🇸🇬 Singapore50$99 billion
#15🇦🇪 UAE45$181 billion

China is an obvious second in billionaire wealth to the United States, with famous billionaires like Zhang Yiming ($44.5 billion) of TikTok and Zhong Shanshan ($67.1 billion), whose wealth primarily comes from the pharmaceutical and beverages industries.

That said, Chinese billionaire wealth actually decreased 2% last year. It was India that came out on top in terms of growth, seeing a 19% increase in 2021.

Billionaires by City

Looking at cities, New York is home to the most billionaires—with 13 added billionaire residents last year—followed by Hong Kong.

RankCityCountryNumber of Billionaires
#1New York City🇺🇸 U.S.138
#2Hong Kong🇭🇰 China114
#3San Francisco🇺🇸 U.S.85
#4London🇬🇧 UK77
#5Moscow🇷🇺 Russia75
#6Beijing🇨🇳 China63
#7Los Angeles🇺🇸 U.S.59
#8Singapore🇸🇬 Singapore50
#9Shenzhen🇨🇳 China44
#10Mumbai🇮🇳 India40
#11Dubai🇦🇪 UAE38
#12Hangzhou🇨🇳 China35
#13São Paulo🇧🇷 Brazil34
#14Istanbul🇹🇷 Turkey33
#15Paris🇫🇷 France33

Billionaire Wealth in 2022

Billionaires have significant power and influence, not in the least because their collective wealth is equivalent to about 11.8% of global GDP.

In recent billionaire news, Gautam Adani’s wealth has been soaring, most recently hitting the $145 billion mark, making him the third-richest person in the world according to Bloomberg’s Billionaire Index. However, not all billionaires are holding on to their wealth. Patagonia founder, Yvon Chouinard, recently transferred ownership of his company to an organization that fights climate change.

Over the last decade, billionaires have been grown their fortunes considerably, with wealth increasing at a faster rate than the growth in the number of billionaires themselves. According to Wealth-X, collective billionaire net worth grew by an astonishing 90% in the last 10 years.

But in the shorter term, the situation is often more volatile. With markets reeling in 2022, Bloomberg reported that billionaires lost a record $1.4 trillion over the first half of the year. Once the year is over and the final numbers are in, it will be interesting to see how the billionaire landscape shapes up in comparison to the more long-term trend.

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