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I think it depends on what's really at stake. I don't think money can buy happiness in the sense that I'd be significantly happier with a bunch of stuff I don't already have or couldn't already afford. I think it can buy happiness, though, in the sense that I'd be a lot happier if I never had to worry about money. A million dollars invested in 30 year treasury bonds will net you about 40k/year in tax free money, a pretty nice supplement to your existing income. 2 million would give you damn near enough to retire on if you invested what you would have been paying in taxes into a retirement fund to get ahead of inflation and maybe take up a part-time job as a raft guide or ski instructor for beer and cigarette money. For most people enough extra money to pay off their mortgage or student loans would make them feel like they were independently wealthy.
Back when I did consumer bankruptcy the effect that financial problems can have on people's lives really hit home. People would find themselves in untenable situations that caused a ton of anxiety and strained relationships (just due to stress and arguments, not borrowing money) and the constant fear that they were one step away from living in a cardboard box. When I told them to stop paying their bills until they had enough money for my fee and then after that the way out was pretty straightforward, the emotional catharsis was always palpable. Some people would break down crying when I told them there was a way out (usually after they had cried considerably when they explained their position). That aside, I couldn't begin to count the number of times clients called to schedule their filing meeting and told me how they felt like they were walking on air as they were leaving the initial consultation. Now to think that there are people who go through that anxiety all the time because their problem isn't so much debt as it is not making enough money, or not being consistently employed, then I can believe that an injection of money large enough to provide a decent cushion would make one significantly happier.
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