Daniel Kahneman gave a talk at TED on the difference between our experiential and our reflective/remembering selves and how they perceive happiness differently. He provides evidence for a saying that has always stuck with me, and that is that being rich isn't guaranteed to make you be happy, but being poor will make you unhappy.
And it turns out that, below an income of 60,000 dollars a year, for Americans, and that's a very large sample of Americans, like 600,000, but it's a large representative sample, below an income of 60,000 dollars a year, people are unhappy, and they get progressively unhappier the poorer they get. Above that, we get an absolutely flat line. I mean I've rarely seen lines so flat. Clearly, what is happening is money does not buy you experiential happiness, but lack of money certainly buys you misery, and we can measure that misery very, very clearly. In terms of the other self, the remembering self, you get a different story. The more money you earn the more satisfied you are. That does not hold for emotions.
He also discusses how we often make vacation decisions based on what we think will make us happy (our remembering self) but not what actually will make us happy during the vacation (our experiential self). Also of note: more frequent and shorter vacations are likely to increase happiness more than fewer, longer vacations.