(MENAFN- News Direct) >

It's that time of year again - the season for giving. But charitable giving isn't just about getting a tax break. It could hold the secret to happiness, for as little as $400.

A six-year study from Cornell University found a simple“happiness hack” that could lead to a more fulfilling life.

Here's how the study worked: Starting in 2019, Cornell researchers, led by psychologist Anthony Burrow, gave students a $400“contribution” with no strings attached, other than it be used to add value“to you and the community around you (1).” Recipients were selected randomly.

Must Read

• Thanks to Jeff Bezos, you can now become a landlord for as little as $100 - and no, you don't have to deal with tenants or fix freezers. Here's how
• Robert Kiyosaki says this 1 asset will surge 400% in a year - and he begs investors not to miss its 'explosion'
• Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake - here's what it is and 3 simple steps to fix it ASAP

While the results of the six-year study aren't yet peer-reviewed or published, they do provide food for thought. The results were consistent: After eight weeks, students who received a $400 contribution scored significantly higher on sense of belonging, sense of purpose and latent well-being than those who didn't receive a contribution.

“Invite people to think about a contribution they want to make and help them [to] make that contribution and that person may walk around with greater purpose than if they hadn't done that,” Burrow told The Washington Post (2).

Can purpose lead to happiness?

When it comes to finances, we spend a lot of time focused on budgeting, paying bills and saving for future goals - all of which are important. After all, debt and financial strain can lead to psychological distress such as stress, anxiety and depression (3).

But, if you're able, giving back can also be part of your budget. Even a moderate amount, like $400, could have an outsized benefit on your health and wellbeing.

Take Gen Z. They're the most digitally-connected of all generations, yet loneliness is at an all-time high. Nearly a quarter of Americans aged 18 to 29 say they feel lonely, according to a study from the Pew Research Center (4).

In a report from the Harvard Graduate School of Education, 58% of young adults said they had little to no purpose or meaning in their life and half said this was negatively influencing their mental health (5).

And a study of more than 1,000 Gen Zers by Harmony Healthcare IT, a healthcare data management firm, found that 46% of Gen Zers have been diagnosed with a mental health condition while 37% suspect they have an undiagnosed condition (6).

While it's not a cure-all, finding a sense of purpose and actively contributing to a cause you care about - even in small, regular ways - could potentially boost your own happiness.

But how exactly does this work?

“So much of the pop psychology stuff is 'focus on yourself, focus on your own personal growth, focus on your needs, focus on your self-care, focus on you, you, you,'” psychologist Kendall Cotton Bronk of Claremont Graduate University told The Washington Post (2).

But she says the“real path to happiness is focusing on others, on how you can contribute to others and their well-being.”

Indeed, research has shown that a greater sense of purpose can spill over into other areas, enhancing one's psychological, physical and social well-being - potentially even slowing age-related cognitive decline (7).

“Purpose, from our perspective, is not something merely to attain, but rather is an important predictive variable of physical health and mental health,” according to researchers from George Mason University.

Trending: Approaching retirement with no savings? Don't panic, you're not alone. Here are 6 easy ways you can catch up (and fast)

How to find purpose

Finding purpose is different for everyone. In The Contribution Project (the ongoing result of Cornell's study), one participant used the $400 contribution to make care packages for people experiencing homelessness; another used the funds to install birdhouses for Eastern bluebirds around the community as a reminder of the beauty of nature (1).

And purpose can change over time.

When you're younger and perhaps don't have a lot of extra cash to spare, you could donate your time and energy to a cause that's close to your heart. Maybe you love dogs, so you could volunteer to walk dogs at a local animal shelter.

As you approach retirement, you might have more money to spare. But it's also a good time to start thinking about how you'll spend your golden years in a meaningful way - and charity can certainly be a part of that (8).

And if you're part of a cohort planning to make larger contributions to qualified charities, there are some new tax rules to note.

If you take the standard deduction (rather than itemizing your deductions) - which is the case for most Americans - then you don't get a tax break on charitable giving. But a new charitable tax break will be available to non-itemizers in 2026, worth up to $1,000 for single filers and $2,000 for married couples filing jointly (9).

However, for high-earners (those in the 37% federal income tax bracket who also itemize their deductions), the tax break will be capped at 35% (10).

But this cap shouldn't deter high-earners from charitable giving - after all, the Cornell study shows that giving money away to a cause that you care about pays dividends in happiness too.

What to read next

• Here's why wealthy investors are pouring millions into this 1 US asset class - and how to quickly copy the move while there's still time
• Warren Buffett used 8 solid, repeatable money rules to turn $9,800 into a $150B fortune. Start using them today to get rich (and stay rich)
• Dave Ramsey says this 7-step plan 'works every single time' to kill debt, get rich - and 'anyone' can do it
• 22 US states are already in a recession - protect your savings with these 10 essential money moves ASAP

Join 200,000+ readers and get Moneywise's best stories and exclusive interviews first - clear insights curated and delivered weekly. Subscribe now.

Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

The Contribution Project (1 ); The Washington Post (2 ); National Library of Medicine (3 ); Pew Research Center (4 ); Harvard Graduate School of Education (5 ); Harmony Healthcare IT (6 ); Psychology Today (7 ); Mayo Clinic (8 ); USA Today (9 ); DAFgiving360 (10 )

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

MENAFN20112025005728012573ID1110376997