Doctor Identifies Personal Growth as the Most Powerful Use of Money for Lasting Happiness

The question of whether money can truly buy happiness has long drawn mixed conclusions, but Dr. Jordan Grumet, hospice physician and author of "The Purpose Code," says the answer depends on how it is spent. Speaking to CNBC Make It, Grumet explained that wealth itself does not determine fulfillment, noting he has cared for “really, really happy poor people” as well as “really, really miserable rich people.” Instead, he argues that the most overlooked and effective use of money is investing in personal growth — a form of spending that can be done on any budget.

Grumet, who has written about the subject in "Psychology Today," observed that the happiest people at the end of their lives are those who have few regrets. “What I think is the most enduring type of spending is when we spend on becoming a better version of ourselves,” he said. Examples include hiring a coach, buying equipment for a passion such as running, or joining groups that foster meaningful connections. He calls these “communities of internal purpose.”

Elderly couple smiling | Source: Pexels

Spending on self-development, he explains, leads to deeper relationships and a sense of purpose, aligning with findings from a decades-long Harvard study that close, personal connections are central to happiness.

Grumet contrasted this with two other forms of spending he considers less durable. Spending on experiences, such as travel, can bring joy through anticipation and memories, but often falls victim to the “hedonic treadmill,” where repeated exposure reduces excitement. Buying material goods, meanwhile, typically provides only fleeting satisfaction, though he notes that gifts for others can create more lasting joy.

“Just because you don’t have a lot of money doesn’t mean that the little bit you do spend [can’t be] on something that’s deeply important to you,” Grumet said. “That spending actually gives you a lot of happiness.”