We’ve all heard that money can’t buy happiness. The research says otherwise, up to a point. There’s a specific income level where the emotional returns on earning more start to flatten out, and economists have a name for it: income satiation. The catch? That number looks completely different depending on where you live.
A new analysis from Remitly maps the “price of happiness” across 123 countries and dozens of major cities, adjusting for local purchasing power and inflation. The findings reveal a striking global divide and a sobering truth about how far the average paycheck actually stretches.
What “the price of happiness” actually means
The concept comes from a landmark 2018 study published in Nature Human Behaviour by researchers Andrew Jebb, Louis Tay, Ed Diener, and Shigehiro Oishi, who analyzed Gallup World Poll data from 164 countries. They found that happiness does rise with income but only until it hits a plateau. Globally, they pegged the satiation point for “life evaluation” at roughly $95,000 per individual, with emotional day-to-day well-being leveling off earlier, around $60,000 to $75,000.
Happiness here isn’t a vague feeling. It’s measured through three factors: a life evaluation score (where people rate their life from 0 for “worst possible” to 10 for “best possible”), plus whether they experienced mostly positive or negative emotions the previous day.
Remitly took those regional figures and reverse engineered them into local prices, converting through country specific purchasing power ratios from the IMF, then back into US dollars for comparison. The result is a country by country price tag on contentment.
Europe dominates the high end Iceland tops the list
Of the 123 countries analyzed, 18 have a six-figure price of happiness in US dollars. Fourteen of them are European, joined by the U.S., Canada, Australia, and New Zealand.
Iceland leads the world at $163,579, the most expensive place on earth to reach income satiation. Yet Icelanders are far from miserable. The Nordic island ranked second in the 2025 World Happiness Report, powered by world-leading social support scores. As report contributor Hrund Gunnsteinsdóttir told the BBC, “In countries with greater gender equality, people are healthier, happier and have better wellbeing.”
That pattern echoes the broader 2025 World Happiness Report, in which Finland was crowned the happiest country for the eighth straight year, with Nordic nations sweeping the top spots. The through line: strong social support and institutional trust matter as much as raw income.
The other end: where happiness is “cheap” but out of reach
At the bottom of the price spectrum sit countries across Africa and Latin America. Ethiopia has the lowest price of happiness at just $10,176. But that number is deceptive. With an average annual income of only $777, Ethiopians are among the least likely in the world to actually reach their satiation point.
That gap between what happiness costs and what people earn is the real story and it exposes a global mismatch between labor and reward.
Slovenia: the one country that actually pays enough
Here’s the outlier that stands out. In nearly every country studied, the average income falls short of the price of happiness. Slovenia is the sole exception the average income of $42,754 sits 16.3% above its satiation point of $36,769.
It may not be a coincidence. Slovenia is one of a handful of nations that factors well being indicators, including happiness, into policy decisions. Its neighbors follow closely: Latvia (84.7%) and Poland (74.5%) also boast some of the most favorable salary to happiness ratios in the world.
The U.S. costs $135K but New York demands $196K
Across America, the price of happiness is $134,827, the fifth highest of any country. But national averages hide enormous local variation.
- New York City tops the U.S. at $195,969 where life evaluation scores don’t level off until income crosses nearly $196K a year.
- Honolulu ranks second at $192,441.
- Cincinnati is the cheapest major U.S. city at $122,480 over 37% less than New York.
- Three Texas cities land among the lowest: Austin ($130,123), Houston ($125,224), and San Antonio ($123,656).
New York’s sky high figure comes with a bitter irony. Despite being crowned the “World’s Wealthiest City” in 2025, home to 384,500 millionaires, per Henley & Partners its rent runs about 149% of the national average, and wage inequality is widening even as it shrinks elsewhere in the country. For most residents, that $196K happiness threshold is simply out of reach.
City snapshots: UK, Australia, Canada, and Spain
The report drills into major cities across five countries. A quick tour:
- United Kingdom: London is the priciest at £116,097 ($155,187) nearly 15% more than second place Oxford. The five most expensive UK cities are all in the South or Southeast. Sheffield is the most affordable.
- Australia: Sydney tops the list at $255,524 AUD ($178,407), ahead of Canberra and Brisbane. Notably, Brisbane the cheapest of the seven cities analyzed posts some of the highest well being scores, even amid a housing crisis.
- Canada: Victoria leads at $169,951 CAD ($124,047), edging out Vancouver and Toronto. Kingston is the most affordable at $140,513 CAD ($102,560).
- Spain: Madrid ($102,190), Barcelona ($100,828), and Palma de Mallorca ($100,487) run neck and neck at the top, while Granada is the most affordable at $83,285 thanks to its climate, history, and reasonable home prices.
So, can money actually buy happiness?
The honest answer is: it’s complicated and the science keeps evolving. In 2023, an “adversarial collaboration” between Nobel laureate Daniel Kahneman and researcher Matthew Killingsworth revisited the old “$75,000 plateau” idea and reached a more nuanced conclusion. For most people, happiness keeps rising with income well beyond earlier estimates. Only for an unhappy minority roughly 15% to 20% of people does happiness plateau around $100,000, because money can’t fix struggles like depression or grief.
What income can provide is a foundation: a sense of safety, freedom, and control. A Universal Basic Income trial in Finland found that even modest, unconditional payments “significantly boosted multiple measures of the recipients’ well being,” even when they didn’t dramatically change employment outcomes.
The takeaway
The price of happiness isn’t a universal number it’s a moving target shaped by geography, cost of living, and purchasing power. And in all but one country on earth, the average person earns less than what it theoretically takes to max out their life satisfaction.
That gap is the real headline. It suggests that closing the distance between what people earn and what a good life costs through smarter policy, fairer wages, and stronger social support may do more for global well being than any individual raise ever could. Money may not buy happiness outright, but having enough of it, in the right place, clearly helps.
Where does your city land on the happiness price scale? The full country and city breakdowns are worth a look you might be surprised what “enough” costs where you live.