Does money really buy happiness? Studies by a generation of behavioral scientists show that material goods usually don't deliver lasting happiness. But there is one way that money can buy happiness—when you spend money with and for others. Researchers call this phenomenon a "buying experience." Think of treating someone to a special meal, a sports game, or a concert. Dozens of studies show that these buying experiences bring us closer to other people and bring us more happiness than spending money on ourselves.

Elizabeth Dunn and Michael Norton, a pair of researchers who authored the book Happy Money, reported on the following experiment:

We handed out Starbucks gift cards on a university campus …. [and] told some people to head to Starbucks and buy something for themselves. We told others to pass their gift card along to someone else. And we told a third group of people to use the gift card to buy something for someone else—with the additional requirement that they actually hang out with that person at Starbucks.

Dunn and Norton concluded, "Who was happiest? Those who treated someone else and shared in that experience with them. So the cost of increasing your happiness may be as cheap as two cups of coffee."