Life, liberty, and the pursuit of happiness are three of our inalienable rights as stated in the US Declaration of Independence. This article will focus on the pursuit of happiness and its relationship to money. Balancing your money and happiness isn’t always an easy task. If you spend too little, you can miss out on many life experiences, but if you spend too much, you can easily fall deeply into debt. This is why it’s so important to strike a balance between your money and happiness. Here are a few tips to help you out.

1. Don’t Be Too Frugal
Frugality is generally a good thing, but if it’s overdone, it can do more harm than good. If you live too frugally, you might miss out on opportunities to live your life to the fullest. To avoid this mistake, evaluate your financial situation and determine whether you’re being too frugal.

If you’re not spending enough money on yourself and your own enjoyment, you might want to change your habits. Instead of putting all of your money into untouchable savings, you may want to start a vacation, or rainy day fund. This will help you continue your healthy saving habits, while putting some of your money into your own enjoyment.

2. Find Out What Gives You The Most Happiness Per Dollar
Using the metric of happiness per dollar can help you save money and pursue what makes you happiest. Determining the happiness per dollar of your favorite activities can also help you track your hobby related spending. If you don’t track and budget your spending, you can easily squander away a lot of your money.

To determine what yields the highest happiness per dollar, start off by firing up your favorite spreadsheet program. List all of the activities and hobbies you enjoy and rate how much relative happiness they each give you on a 1 to 10 scale (10 being the most). In another column, write down the annual costs related to each particular activity and hobby. In the third column, put the two values into a happiness per dollar ratio. The next step is to sort the results by happiness per dollar.

The information won’t be perfect. Even if, say, cars bring in a 10 on your happiness scale, it may have a low happiness per dollar ratio because of the high costs of car ownership and maintenance. Although there may be some abnormalities in your results, putting together a spreadsheet like this can put things into perspective and set you on your way to having a more satisfying life while spending less.

3. Don’t Fall Into The Debt Trap
Falling deeply into dept can be one of the costliest mistakes you could ever make. Because of the way interest works, debt can snowball very quickly and can become virtually impossible to pay off. Being financially trapped by debt can make it very difficult to enjoy the activities and hobbies that bring you the most satisfaction. They say the best things in life are free, but not having money is certainly no walk in the park.

To avoid falling into the debt trap, practice frugality, and spend within your means. This can take a lot of discipline but can benefit you tremendously in the future. By keeping your personal debt under control, you’ll have more time and money to enjoy your life.

4. Volunteer And Donate To Charity
One of the most satisfying things you can do is to give your time and money to a worthy cause. Volunteering and donating can have many positive effects on both you and your community. If you’ve never volunteered or given to a charity, it’s never too late to start. You can search online for local non-profit organizations to give your time and money to. One particularly helpful website for connecting volunteers to non-profits is VolunteerMatch.org.

One important side effect of giving your time and money to others is that money will have less of a hold on you. If you live frugally and pinch all of your pennies, you can easily become a miser. Being able to share what you have may not have immediate monetary benefits, but will help you keep your life more balanced.

5. Turn A Passion Into A Second Job Or Business
Everyone has at least one thing they’re very passionate about. Typically if you’re passionate about something, you probably have a high level of expertise in the area which can lead to a second job or successful business. This can help you spend more time doing what you love while making some extra money on the side.

If you do have a particular passion you’d like to turn into a second job or business, the first thing to do is to see what’s out there. If there are many businesses in the area you’re interested in, it might be a better idea to find employment instead of starting your own business. A crowded market is never easy to break into, but if your passion lies in a small niche, you might have what it takes to start and run a successful business.