Money and happiness - how much does it cost to be happy in Norway?
Here I’m digging into the study by Kahneman, Killingsworth, and Mellers, published in PNAS (2023), where the authors explore the correlation between income and happiness.
📌 TL;DR
The answer: yes, but not equally for everyone.
The benchmark line: an annual income of NOK 1,100,000 (as of April 2025).
📊 The Numbers
- For most people — the higher the income, the higher the happiness.
- For the unhappiest 20% — happiness increases with income up to a point, then levels off.
- For the happiest individuals — happiness continues to rise with income, possibly even faster.
The relationship between income and happiness depends on your starting level of well-being.
👥 Why split people into groups?
Because the “average person” is a myth.
In earlier studies:
- Kahneman and Deaton (2010) found that happiness increases with income up to ~$75,000 a year, and then levels off.
- Killingsworth (2021) showed that happiness keeps increasing with income, with no clear ceiling.
The issue? They were looking at different groups of people.
The authors of the new study broke participants into quantile groups (the happiest, the average, and the unhappiest) based on their well-being:
- Bottom 20% — the least happy. For them, income helps up to ~$100,000 (≈ NOK 1,100,000 in 2025). Beyond that, not much changes.
- Top 30% — the happiest. For them, happiness continues to increase with income — maybe even faster beyond the million mark.
This explains why previous findings seemed to contradict each other — the average masked individual differences. One person earning NOK 800,000 may feel a happiness boost, while another might barely notice a difference anymore.
📏 How is happiness measured?
The study used two approaches:
Momentary well-being
Participants received random notifications during the day and answered: “How do you feel right now?” These data were collected via a mobile app, as used in Killingsworth’s study.Evaluative well-being
The classic survey question: “How satisfied are you with your life overall?” — rated from 0 to 10.
Kahneman focused more on the former, Killingsworth on the latter. The new study combines both — and finally gives us the full picture.
🇳🇴 What about Norway?
Taking into account inflation as of April 2025 (~2.6% according to SSB CPI), here’s what the U.S. happiness thresholds look like in Norwegian kroner:
- $75,000 in 2010 ≈ NOK 940,000 today
- $100,000 ≈ NOK 1,100,000
If you’re in that range — increasing your income might still move the needle.
Above that? Maybe it’s time to focus on the less material parts of life.
💰 What about taxes?
The study doesn’t mention taxes. All income figures like $75,000 or $100,000 refer to gross income — that is, before taxes.
In Norway, this is especially important. At an annual income of NOK 1,100,000 (gross), you’ll take home roughly NOK 700,000–750,000 after taxes, depending on deductions and your specific situation.
💡 So when comparing yourself to the study’s figures, focus on gross income, not what actually lands in your bank account.
Interestingly, despite higher taxes, countries like Norway still report high levels of well-being. That might be due to how taxes are used — healthcare, education, public safety nets, etc.
📎 Norwegian Tax Calculator (Skatteetaten)
🧍♂️ Individual or household income?
Important detail: the study refers to individual income, not household or family income.
So the $100,000 ≈ NOK 1,100,000 benchmark applies to a single adult, not to couples or families with children.
Official Norwegian statistics (like those from SSB) usually focus on household income or equivalized income, which accounts for the size and composition of the household.
If you’re living alone, the comparison is direct.
For a couple, a comparable threshold would be somewhere around NOK 1.8–2.0 million in total household income.
📎 SSB: Household Income by Quantile Groups
📐 Conversion to G (grunnbeløpet)
To make the numbers more future-proof and easier to compare over time, it’s useful to express income in G — grunnbeløpet i folketrygden, the base amount used in Norway’s national insurance system. This figure is adjusted annually and is used to calculate a wide range of social benefits.
As of May 1, 2024, 1 G = NOK 124,028
📎 Source: Skatteetaten.no
So that means:
- NOK 1,100,000 ≈ 8.87 G
- NOK 2,000,000 ≈ 16.12 G
Using G makes it easier to compare income levels and thresholds independently of inflation and economic changes.
🧠 Final Thoughts
- Money really can buy happiness — but not for everyone, and not forever.
- In the early stages, income makes a big difference.
- Then other things kick in: health, relationships, meaning, and all the “soft” stuff.
If you’re earning around NOK 1,100,000 a year, you’re likely in the zone where happiness still nudges upward with income.
If not — maybe it’s worth thinking beyond the numbers.