Money and Happiness: How Financial Wellness Impacts Mental Health for Ambitious Women
- Liah Jimenez
- Feb 26
- 6 min read
For a long time, I believed the saying, “money can’t buy happiness.”
I repeated it whenever I felt guilty for wanting more: more financial freedom, and more experiences that felt just slightly out of reach while navigating early independence and multiple responsibilities.
It felt like the responsible thing to believe. Wanting more money felt shallow. Wanting luxury felt worse.
But, over the past few years, as I navigated school, work, unexpected expenses, and early attempts at building stability, I began to realize something: the phrase isn’t wrong, but it is incomplete.
Money doesn’t buy happiness. But it changes how heavy life feels.
Understanding this connection has transformed how I approach both my financial goals and my emotional well-being, and it might do the same for you.
What the Latest Research Actually Says
The conversation around money and happiness has evolved dramatically. For decades, a 2010 Princeton study by Daniel Kahneman suggested that happiness plateaus at around $75,000 annually (roughly $100,000 in 2026 dollars). Newer studies reveal a more complex picture.
In 2023, Matthew Killingsworth from the University of Pennsylvania collaborated with Kahneman to conjoin their conflicting findings. Their joint research revealed two key insights.
For the least happy 20 percent of people, emotional well-being does plateau around $100,000. More money does not significantly improve their daily happiness.
For already happy individuals, the positive impact of money actually accelerates beyond $100,000.
Money is less a solution and more a multiplier. It doesn’t create stability on its own, but it strengthens whatever foundation already exists.
The Stress-Reduction Effect: Where Money Matters Most
Here is something I wish I had understood earlier: The biggest shift money creates is not consumption. It is an emotional space.
It is about buying peace of mind.
Research from Harvard Business School found that higher incomes do not prevent stressful events from happening. People across all income levels experience similar numbers of daily frustrations. The difference is that those with higher incomes report less emotional intensity from those stressful events.
We feel this every day when responsibilities stack up at once. When a surprise expense appears — an unexpected bill, last-minute travel, a broken device, or a shift in income — the emotional impact is different when even a small financial cushion exists.
That financial buffer becomes an emotional buffer, and in the chaos of my life, that peace of mind is the real luxury.
Instead of spiraling, I pause. I adjust. I move forward.
Financial buffers become emotional buffers.
Money doesn’t remove stress. It reduces the intensity of stress. And that changes how we experience daily life. The real luxury is not buying more things. It's the feeling of control.
The Poverty Threshold: Why Escaping Financial Insecurity Is Transformative
A comprehensive 2022 study published in The Lancet examined how income changes impact mental health across 90 studies worldwide.
The findings showed that when people's income increased enough to move them out of poverty, their well-being improved dramatically, more than double the effect of other income increases.
I think about this research when I look at my own father's story. He spent my entire 20 years of life at the same job, building stability for our family, and then one day that stability disappeared when he was laid off.
Watching him pivot, update his skills, take on part-time work, and slowly rebuild a new version of financial security showed me in real time how deeply income and identity are tied to mental health.
There were nights when the stress in our house felt heavy, but there was also a quiet determination in the way he reimagined his career.
Seeing him move from fear back toward stability made the data feel personal.
Money does not guarantee happiness, but regaining financial footing after a loss can restore a sense of dignity, hope, and emotional breathing room that you cannot put a price on.
The research confirms what many of us know intuitively. Financial insecurity constantly drains mental energy. Reducing that insecurity is not about greed. It is about creating the foundation for emotional well-being.
How Ambitious Women Are Redefining Luxury and Wellness
Being a middle-class student in higher-income environments makes comparison easy.
Trips. Bags. Experiences. Visible signals.
Research from HMN Strategy identified a new luxury consumer cohort called "Joy Rejuvenators", women who view luxury purchases as emotional investments rather than status symbols. Over half of the women surveyed prioritize emotional spending and small "glimmers of joy" in their luxury journey.
What changed was realizing luxury is less about what looks impressive and more about what supports you.
For me, that looks like:
Funding experiences that expand my worldview
Solo coffee breaks between classes, where I decompress
Buying one quality item that I wear constantly
Spending on growth: books, courses, networking
A 2025 UBC psychology study found that spending on experiences, gifts, and time-saving services led to larger boosts in happiness, especially in wealthier nations where time scarcity is a primary stressor.
I have learned to define luxury on my own terms, not by what everyone around me can afford to buy.
The Grounded Glow Framework: Money as Mental Health Tool
Through trial and error in college, I developed a framework for using money to support mental wellness, which I call The Grounded Glow Framework.
1. Grounded Security (The Foundation Layer)
This is the foundation. Feeling safe enough to breathe.
Things I have personally found that help:
Automating bills
Starting an emergency fund, even a small one (aim for 3-6 months of expenses)
Creating structure around spending
I use the 50/30/20 rule as a starting point: 50% needs, 30% wants, 20% savings and investing.
I don’t follow it perfectly. Most people don’t. But structure reduces anxiety. It removes constant mental math.
Automation gave me peace faster than earning more did.
I’ve started realizing structure itself is a form of ambition design, similar to how frameworks like SMART goals help translate ambition into clear action.
Clarity reduces overwhelm. In both money and life.
2. Intentional Hustle (The Purpose Layer)
Ambition without boundaries leads to burnout.
Juggling multiple roles taught me that every hour has meaning:
paying for school
building resilience
creating optionality
But hustle without intention becomes exhausting.
Intentional hustle asks: Does this effort build something beyond income?
That question changes how you choose opportunities.
3. Joyful Luxuries (The Elevation Layer)
Emotional investments regulate energy more than big purchases.
Coffee rituals. Time with friends. Experiences. Skill development.
A $5,000 study abroad program this past January had a more immediate emotional impact than many smaller purchases I have made. Both matter, but intentional experiences create lasting transformation.
That impact compounds emotionally.
4. Expansive Exposure (The Impact Layer)
Eventually, money becomes about meaning.
Giving. Mentorship. Creating spaces for others.
Purpose stabilizes ambition. Without it, achievement can feel empty.
Establishing a donations drive for my local women's shelter took two months to launch, but it provided immense purpose and fulfillment.
Investing In Your Future
One of the most calming realizations I’ve had is that wealth building is less about big moments and more about time.
Compounding rewards consistency.
Opening a Roth IRA is a simple example. I have been making small contributions that will grow quietly for decades. Starting it creates leverage that income alone cannot replicate later.
This applies across ages.
In your twenties, time is your biggest asset.
In your thirties, consistency matters.
In your forties and fifties, intentional strategy matters.
Investing shifts money from reactive to protective. It changes your relationship with the future.
And that shift reduces anxiety in ways people rarely talk about.
When More Money Will Not Help: The Happiness Ceiling
There were times when, on paper, I was "doing better" financially, picking up extra shifts, bills paid, affording little treats like a chai before class or eating out when I was too tired for the dining hall. From the outside, it looked like I had figured it out.
But inside, I was still exhausted and anxious. No amount of direct deposit notifications could fix the fact that I was not sleeping enough and was tying my worth to how productive I was.
The problem wasn’t income. It was boundaries.
That realization was uncomfortable, but freeing. It clarified that financial wellness and emotional wellness are parallel systems, not substitutes.
The Atelier Perspective
The relationship between money and mental wellness isn’t about choosing between grounded and ambitious, practical or aspirational.
It’s about design.
Money provides safety, control, choice, and capacity for impact. But an elevated life happens when financial structure meets intentional living.
That means:
Building stability before chasing status.
Spending in alignment with energy, not comparison.
Investing early so future you feels less pressure.
Treating growth, therapy, and rest as real investments.
Money cannot manufacture joy. But it can create space for it.
Money buys breathing room. It buys options. It buys time.
And when used intentionally, it helps create the conditions where genuine joy has somewhere to land.
That is the grounded glow.
References
HMN Strategy. (2023). Female spending power drives luxury transformation. Luxury Consumer Research
Investopedia. (n.d.). Roth IRA: What it is and how to open one. https://www.investopedia.com/terms/r/rothira.asp
Jachimowicz, J. et al. (2022). Financial stability and stress reduction. Harvard Business School Working Knowledge. https://www.library.hbs.edu/working-knowledge/more-proof-that-money-can-buy-happiness
Killingsworth, M. A., Kahneman, D., & Mellers, B. (2023). Income and emotional well-being: A conflict resolved. Proceedings of the National Academy of Sciences, 120(10), e2208661120. https://doi.org/10.1073/pnas.2208661120
Lund, C. et al. (2022). How do income changes impact on mental health and wellbeing? The Lancet Public Health. https://www.thelancet.com/journals/lanpub/article/PIIS2468-2667(22)00058-5/fulltext
May, J. (2025, December 10). What are SMART goals? A clear, elegant framework for structured ambition. The Ambition Atelier. https://www.theambitionatelier.com/post/what-are-smart-goals-a-clear-elegant-framework-for-structured-ambition
Stenlund, S. & Dunn, E. (2025). Money buys happiness in different ways. UBC Psychology Study. https://psych.ubc.ca/news/money-buys-happiness-2025/
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