Laura Rowley Money & Happiness

Nearly 80 percent of U.S. adults say they need more money to feel financially comfortable, and more than a quarter would have to double -- or more than double -- their current income to achieve that goal, according to a new Yahoo! Finance/Harris Interactive survey.

(See the links at the end of this column for the survey questions and answers.)

Instant Dissatisfaction

The survey, conducted earlier this month, looked at five broad areas of financial life: satisfaction with income; awareness of cash on hand; budgeting; obstacles to money management; and work/life balance.

Among the other findings:

Researchers in the field of well-being said they weren't surprised at the results. "It doesn't matter what the income level is, people always think they need more than they have," says Tim Kasser, a psychology professor at Knox College in Illinois and author of "The High Price of Materialism."

"The new car is great when you get it, but after six months you get used to it, and then the culture steps in and says, ‘Are you dissatisfied? Buy this year's model with heated seats, a global positioning system, and an MP3 player,'" Kasser says.

The More You Have, the More You Want

Studies show that a certain amount of money does indeed make people happier: People who live in wealthy nations report higher levels of happiness than those who live in poor ones.

But excessive wealth seems to raise the happiness bar only slightly. During the 20th century, significant jumps in economic growth and income in developed nations like the United States and Japan have been accompanied by only marginal increases in happiness.

Even the filthy rich -- the Forbes 100 richest Americans -- scored only slightly above the average person on the happiness scale, according to a study by psychology professor Ed Diener at the University of Illinois, Urbana-Champaign.

"People always want more money and then, when they get more, they end up wanting more again, because they adapt to the kinds of things they buy," explains Richard Easterlin, a professor of economics at the University of Southern California and a pioneer in the research on well-being.

Researchers suggest that people are stuck on a "hedonic treadmill," constantly adapting to the improvement in their material circumstances. "The adaptation and the escalation of goals is very substantial in the monetary area -- but seems to be quite limited in family, health, and other non-monetary domains," says Easterlin.

Keeping Up with the Joneses

Envy is another key factor fueling the drive for more. "Everyone knows what kind of car and house the neighbors have -- it's the invidious social comparison that undermines feelings of well-being in the financial arena," says Easterlin.

"People always have this illusion they'll be happier if they make more money. They end up sacrificing family, health, and everything else to make more money when they'd be better off sacrificing money to spend more time on health and family."

On the other hand, 48 percent of survey respondents say they do want more family time -- they just don't want to give up a huge amount of salary to make it happen.

Rich in Time

How much would people sacrifice to spend an extra hour a day with family or loved ones? A quarter would only give up 5 percent of their salary; 15 percent would sacrifice 10 percent of their income; 4 percent would give up 20 percent of pay; and 5 percent would tolerate a cut of more than 20 percent.

The group who most desired time rather than the money? Men age 45 to 54, with 61 percent reporting they would make the tradeoff. "We're one of few nations in the world without a mandatory vacation policy or a maximum limit on the amount of overtime you can ask someone to work," says Kasser. "We're time-poverty-stricken."

Kasser has conducted a variety of studies that found people who are "time affluent" are happier than those who are materially affluent. "Time-affluent people had more time to spend engaged in activities focused on personal growth, friends, and family and contributing to community" -- all essential factors in happiness, he explains.

Meanwhile, experts agree that financial comfort can be achieved by carefully managing the money you have -- something 23 percent of survey respondents said they don't have the knowledge to do.

A Knowledge Vacuum

Among women age 45 to 54, roughly one-third cite "lack of knowledge" as a hurdle in managing their money. "That's the tail end of baby boom women, where women are still at a disadvantage because they may not have had that exposure in their families," says Candace Bahr, a financial planner and co-founder of the Women's Institute for Financial Education.

Bahr, 53, says she learned about money at the kitchen table with her father, a blue-collar worker who invested in stocks whenever he had extra money. "I got that training through osmosis, but a lot of my contemporaries didn't," says Bahr. "It was an uncomfortable subject for some people -- and that lack of training as children can be hard to overcome."

While women report lacking information, men don't have the time, or curiosity. Most likely to lack the time and interest to manage their money: Men ages 35 to 44, at 29 percent and 17 percent respectively.

Meanwhile, boomer women are most likely to follow a budget: 56 percent of women age 45 to 54 said they crunch the numbers, compared to 44 percent of respondents overall. Second most likely: Someone who is widowed, separated, or divorced; more than half of that group reporting using a budget.

"A spending plan helps people connect the consequences with the choices they are making," says Karen McCall, a financial counselor and founder of the Financial Recovery Counseling Institute in San Rafael, Calif. "If people are constantly wondering every time they spend money ‘Is it OK? Is it not OK?' there can be a lot of guilt, shame, and negative consequences."

Getting What You Need

Just as important as devising a plan is tracking how you spent against your budget, McCall says. "If you're not sticking to it, it's for one of three reasons: You didn't plan enough from the beginning; something came up that truly could not have anticipated; or ‘I saw it, I wanted it, I bought it.'"

If it's the latter, McCall says, there may be an emotional trigger behind the wayward spending. For instance, a workaholic will say ‘I deserve this' and buy something to feel better, instead of recognizing she would be better served by taking more time to exercise, be with friends and family, or volunteer.

"People should do a thorough inventory of how they are and are not taking care of themselves, and make a list of how they can meet those needs," McCall says. "They may be frittering money away on things they don't need -- and we can never get enough of what we don't need."

The Yahoo! Finance/Harris Interactive Survey

Click each question to see the answer in graphical form:

1. How accurately can you recall how much money is in your primary bank account (i.e., your checking account, or other account from which you draw your daily expenses)?

2. Have you ever tried to manage your money by using a budget?

3. What is the biggest obstacle you face regarding financial planning and money management?

4. What percent reduction in your household income would you be willing to take if it meant gaining an extra hour each day with your family or loved ones?

5. How much more money would you need to have coming in to your household to make you feel financially comfortable?