Allocate part of your values budget to others

Prosocial spending — money spent on others — generates more lasting satisfaction per dollar than equivalent self-spending.

Why it works

Spending on others activates social connection and reinforces the sense of meaning and competence that self-determination theory identifies as the primary drivers of durable wellbeing. The effect is partly because social spending is more varied (you customize to the recipient) and partly because it strengthens relationships — a category consistently associated with the highest wellbeing returns. The satisfaction also does not adapt as quickly because the experience is embedded in relationship memory, not material ownership.

How to do it

1. Allocate a deliberate line in your values budget for giving and social spending.
2. Prioritize direct giving over anonymous donation for the wellbeing benefit — connection is part of the mechanism.
3. Keep amounts specific and intentional: a $30 thoughtful gift generates more satisfaction than $30 added to a charity payroll deduction you do not think about.

Evidence

Experimental studies by Elizabeth Dunn and colleagues found that participants who spent money on others reported higher happiness than those who spent on themselves, controlling for the amount spent. (rct)

The original studies used relatively small amounts and short time horizons. Effect sizes vary with the nature of giving and the recipient relationship; obligatory giving does not show the same benefit.

Sources

• Dunn, Aknin & Norton (2008), "Spending Money on Others Promotes Happiness," Science

Common mistake

Treating prosocial spending as a separate moral category rather than a genuine wellbeing investment — it belongs in the values budget alongside any other high-return spending.