Money Buys Health?

Or at least lack of illness-causing germs?

As a general rule, the higher the price [of a hotel room] the cleaner the room. "I did a study about seven years that found if you paid more than $50 a night, there was a much greater chance that the room was regularly disinfected," [University of Arizona microbiologist Charles Gerba, PhD, a leading researcher better known in the science world as "Dr. Germ"] tells WebMD. "Rooms under $50 weren't." But no matter the price, the single place where you'll find the most surface germs: the TV remote. "It's never cleaned," he says.

Germs Are Everywhere - Really by Sid Kirchheimer, WebMD.com, 1/31/2005

Money Buys Happiness - When You Spend It On Others

Money buys happiness - if you spend it on someone else, Reuters, March 20, 2008:

WASHINGTON (Reuters) - Money can buy happiness, but only if you spend it on someone else, researchers reported on Thursday.

Spending as little as $5 a day on someone else could significantly boost happiness, the team at the University of British Columbia and Harvard Business School found.

Their experiments on more than 630 Americans showed they were measurably happier when they spent money on others -- even if they thought spending the money on themselves would make them happier.

"We wanted to test our theory that how people spend their money is at least as important as how much money they earn," said Elizabeth Dunn, a psychologist at the University of British Columbia.

They asked their 600 volunteers first to rate their general happiness, report their annual income and detail their monthly spending including bills, gifts for themselves, gifts for others and donations to charity.

"Regardless of how much income each person made, those who spent money on others reported greater happiness, while those who spent more on themselves did not," Dunn said in a statement.

Dunn's team also surveyed 16 employees at a company in Boston before and after they received an annual profit-sharing bonus of between $3,000 and $8,000.

"Employees who devoted more of their bonus to pro-social spending experienced greater happiness after receiving the bonus, and the manner in which they spent that bonus was a more important predictor of their happiness than the size of the bonus itself," they wrote in their report, published in the journal Science.

"Finally, participants who were randomly assigned to spend money on others experienced greater happiness than those assigned to spend money on themselves," they said.

They gave their volunteers $5 or $20 and half got clear instructions on how to spend it. Those who spent the money on someone or something else reported feeling happier about it.

"These findings suggest that very minor alterations in spending allocations -- as little as $5 -- may be enough to produce real gains in happiness on a given day," Dunn said.

This could also explain why people are no happier even though U.S. society is richer.

"Indeed, although real incomes have surged dramatically in recent decades, happiness levels have remained largely flat within developed countries across time," they wrote.

Study: Even Small Copayments Deter Preventative Health Care

Even small copay deters mammogram use, study says:

PROVIDENCE, Rhode Island (Reuters) - Requiring even a small co-payment dramatically reduces the likelihood that women will get regular mammograms to detect breast cancer, researchers reported on Wednesday.

Screening rates from 2001 through 2004 were nearly 11 percent lower for women who had to contribute a co-pay as low as $12, compared to women whose mammograms were free, researchers from Brown and Harvard universities found.... even though nearly all women know the value of mammograms...

Reuters, January 23, 2008

Money Quotes: Jim Cramer

People always say money can't buy happiness, but I've never found that argument compelling. Money can buy peace of mind; it can take care of you and your loved ones, and to a certain extent money means freedom.

Financial guru Jim Cramer, Stay Mad for Life (2007), p. 17.

Inheritance Humor

Dan was a single guy living at home with his father and working in the family business. When he found out he was going to inherit a fortune when his sickly father died, he decided he needed a wife with which to share his fortune.

One evening at an investment meeting he spotted the most beautiful woman he had ever seen. Her natural beauty took his breath away. "I may look like just an ordinary man," he said to her, "but in just a few years, my father will die, and I'll inherit 20 million dollars."

Impressed, the woman obtained his business card and three days later, she became his stepmother.

- Source unknown

Study: Money, Mental Health Strongly Related

A Gallup study reports that there is a strong relationship between income and mental health:

While the substantial majority of Americans rate their mental health today as excellent or good, there are significant variations in this self-reported mental health measure by one's socioeconomic position. Those with higher incomes are much more likely than those with lower incomes to report excellent mental health, and this relationship persists even when other variables such as age, education, gender, and marital status are taken into account.

Wealth inequality 10 times income inequality in United States

The wealth inequality between the bottom 10% and the top 10% in America is greater than ten times the income inequality between the bottom 10% and the top 10% in America, suggesting, perhaps, that much wealth is tied up in unrealized appreciation of family businesses, real estate, and securities portfolios, that higher earners put their money to work while low earners do not, and/or that the low income earners do not have enough money left over after meeting expenses to invest or save:

The best way to give people a sense of where they stand is to lay out some data. Every three years the Federal Reserve Board conducts a national survey that tracks the financial health of American households.

The Fed slices and dices this stuff with the vigor of an Iron Chef; the result is a rich, if dry, array of offerings on household net worth, pension and income levels, plus other demographic side dishes.

Whenever I slip these tidbits into cocktail party chatter, people are surprised to realize how little money it takes to win a gold star from the Fed. If you and yours are bringing in $40,000 a year, you're doing better than half the households in America.

Or, as a Washington think tank recently pointed out: If you're a teacher married to a policeman, your combined household income puts you in the top 25 percent of all households in the nation.

Below you'll find the average income picture sliced into income levels. Think of this chart as a parking ramp. If your household income is $170,000, you're among the nation's top 10 percent wage earners and get to park on the top floor.

Anything in six figures means you're in the top 20 percent and get to park on the floor right below.

Annual income parking ramp
Income level (percentile) Median income (rounded)

Level VI (90 to 100) $170,000
Level V (80 to 89.9) $99,000
Level IV (60 to 79.9) $65,000
Level III (40 to 59.9) $40,000
Level II (20 to 39.9) $24,000
Level I (less than 20) $10,000

Source: Before-Tax Family Income, 2001 Federal Reserve Board Survey

So does making $170,000 a year make a person rich? Last year a plurality of respondents (29 percent) in a survey by The New York Times said that "rich" was making between $100,000 and $200,000 a year. Unfortunately, the survey didn't break out how many people in that salary range considered themselves rich. If the people I talk to are any indication, very few do.

Of course, income is only one part of the equation defining where you stand. Net worth is more telling. Net worth, as every financially precocious schoolchild knows, is the sum of one's assets -- home equity, investments, savings accounts, retirement funds, cars, furnishings and such things as jewelry, furs, wine collection, old baseball cards -- minus all outstanding liabilities such as mortgage balance, revolving and credit card debt, college loans and so on. Across all households, the national median net worth is $86,000. Half of your fellow citizens have more than that, half less. As you see, there's a massive disparity between the haves and have-nots.

Net worth parking ramp
Net worth (percentile) Median net worth (rounded)

Level VI (90 to 100) $833,600
Level V (80 to 89.9) $263,100
Level IV (60 to 79.9) $141,500
Level III (40 to 59.9) $62,500
Level II (20 to 39.9) $37,200
Level I (less than 20) $7,900

Source: Family Net Worth, 2001 Federal Reserve Board Survey

Where Do You Stand On America's Wealth Spectrum?, Bankrate.com, 11/1/2007

Also clear is that the distinction between wealth and income remains lost on the vast majority of Americans and most journalists, as well.