Top 5 money milestones that provide the best return on happiness

Top 5 money milestones that provide the best return on happiness


6 in 10 Americans believe that money can buy happiness. But if this isn’t something you can buy at a store or order online, where does it come from? It turns out that the financial happiness that so many Americans believe in is rooted in accomplishing financial goals.

Let’s take a closer look at what financial happiness means and the steps you might take to get there.

What is financial happiness?

The majority of Americans believe that money can buy happiness. The price? $1.2 million. At this financial threshold, Americans believe that they will experience financial happiness that leads to freedom, security, and relief.

Americans consistently say that financial happiness isn’t just about a bank balance. Instead, they believe that financial happiness spills into all areas of life. 84% of people surveyed as part of Empower’s Financial Happiness research say that it could lead to generational wealth, and nearly as many people say that it would lead to better health. Other commonly cited benefits of financial happiness are closing the pay gap, boosting productivity and creativity, and greater generosity.

Top 5 financial happiness milestones

But financial happiness isn’t just about waking up one day years or decades from now with $1.2 million in the bank. Instead, research shows that five specific money milestones yield a significant amount of financial happiness throughout your savings journey.

Let’s take a closer look at these milestones.

Being able to pay bills on time

Once you start to earn more money and build a budget, one of the first milestones you’ll reach has to do with bills.

You might be thinking – “In what universe do bills equate to financial happiness?” But being able to pay your bills on time is one of the most commonly discussed money milestones. Just shy of 70% of people surveyed identified this as a significant money milestone.

And it shouldn’t come as a surprise. Paying your bills on time can lead to many other benefits including:

  • A higher credit score
  • Lower interest rates
  • No late fees
  • Decreased stress

In short, people who can pay their bills on time have more money to put toward other goals and have an increased mental bandwidth to tackle these goals. Paying your bills on time truly is a critical first money milestone.

Becoming debt free

Another money milestone that yields financial happiness is becoming debt free. Of course, debt freedom means different things to different people. That means that there is no one right way to pay off debt.

Often, people focus on paying down high-interest debt first. That means getting rid of things like credit card debt and payday loans. Next, people might start to target car loans and student debt. Mortgages are generally the last type of debt that people tackle, with the financial rule of thumb of trying to be mortgage free by retirement.

To get a better sense of how becoming debt free can lead to financial happiness, check out the Empower Debt Payoff Calculator.

Enjoying everyday small luxuries without worry

When most people start their financial journey, they spend a lot of time stopping impulse purchases and scaling way back on wants. But what if those cutbacks didn’t have to be permanent?

After you’ve built a solid budget and mapped out a plan for your debt, you can start to indulge in small luxuries again. That doesn’t mean that you throw your budget out the window entirely. Instead, you can build a line item into your budget each month for little splurges. For some people, that might be a latte made for you every Friday. Other people might schedule a massage once a month.

As you pay down your debt and beef up your savings, you will find room for little luxuries that can add a whole lot of happiness to your day-to-day living.

Being able to afford experiences with loved ones

What if you could say yes to a celebration dinner without disrupting your budget for the month? How would taking a family trip each summer feel? As you get further along your financial happiness journey, you will find that you can more comfortably afford experiences with family and friends.

While this certainly won’t look like an around-the-world cruise, it can be a significant way to deepen your connections with those you care about. Study after study shows that most people get more satisfaction from buying experiences, not things. When you have the wiggle room in your finances to afford those experiences, it can be nothing short of life changing. 

Achieving financial freedom

What is financial freedom exactly? As with most things in personal finance, the meaning can vary depending on who you ask.

In general, financial freedom means that you can start to take control of how you spend your time. 64% of Americans said they would quit work if money were no object. But you can use financial freedom to take control of your days even when money is still very much a factor in your life. Perhaps it’s downshifting into part-time work or having enough of a financial cushion to leap into entrepreneurship.

While financial freedom doesn’t necessarily mean retirement, it does mean having more ownership of your time.

How do you know if you’re headed toward financial freedom? See if you’ve tackled these things:

  • Identified your financial goals
  • Built a budget that fits your lifestyle
  • Created a plan to pay down debt
  • Set aside savings in an emergency fund
  • Built sinking funds to cover needs and wants
  • Saved for retirement

Once you’ve progressed on these steps, you can test out a retirement calculator to see how close you are to your goals. As you get closer to achieving these goals, you should find yourself with other opportunities to start designing the life you want now. You don’t have to wait for retirement.

Final thoughts on financial happiness milestones

If you’re nowhere near the double comma club, it’s easy to get discouraged thinking that you need more than $1,000,000 to be happy. $1.2 million may be the magic number for many Americans. However, you may be closer than you think to other money milestones that provide a big return on happiness.



The Empower “Financial Happiness” study is based on online survey responses from 2,034 Americans ages 18+ fielded by The Harris Poll from August 7 to August 14, 2023, and using data from the Empower Personal Dashboard™. The survey is weighted to be nationally representative on the following dimensions: age, gender, education, race, region, income, size of household, marital and employment status. For this study, the sample data is accurate to within + 2.9 percentage points using a 95% confidence level.

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Andy Hill, AFC®


Andy Hill, AFC®, is the award-winning family finance coach behind Marriage, Kids, and Money, a platform dedicated to helping young families build wealth and happiness.

Author is not a client of Empower Advisory Group, LLC, and is compensated as a freelance writer.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. No part of this blog, nor the links contained therein is a solicitation or offer to sell securities. Compensation for freelance contributions not to exceed $1,250. Third-party data is obtained from sources believed to be reliable; however, Empower cannot guarantee the accuracy, timeliness, completeness or fitness of this data for any particular purpose. Third-party links are provided solely as a convenience and do not imply an affiliation, endorsement or approval by Empower of the contents on such third-party websites.

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