Name: Sana Alam, Kiran Panjwani
Country: India

Year: 2026
Volume: Volume-13, Issue-1 (January-June)
Page Number: 390-415
DOI: https://doi.org/10.5281/zenodo.20923477

Purpose: This study explores the intricate relationship between income and emotional wellbeing, with a focus on happiness, mental health, and life satisfaction.
Need for the Study: In a world increasingly driven by material success, it is vital to
understand whether income genuinely contributes to well-being or if its role is overstated. Clarifying this link can inform efforts to reduce financial stress and promote healthier, more fulfilling lives.
Methodology: This research adopts a Systematic Literature Review (SLR) guided by the
PRISMA framework, analyzing 125 peer-reviewed studies published between 2009 and 2023 across Scopus and Web of Science databases. The review incorporates economic and psychological perspectives, including the Easterlin Paradox and the concept of diminishing marginal utility.
Findings: The analysis reveals that income positively correlates with emotional well-being, particularly in terms of reduced stress and improved life satisfaction, but only up to an income threshold of approximately $75,000. Beyond this point, additional earnings
contribute minimally to happiness. Relative income, income stability, and social comparisons significantly influence well-being, often more than absolute income levels.
Practical Implications: These insights have direct implications for policy making, taxation structures, and financial planning. Policymakers and institutions can use this evidence to craft initiatives that prioritize emotional health, equitable income distribution, and holistic measures of success, rather than solely economic indicators.
Keywords: Income, Emotional Well-being, Happiness, PRISMA, Systematic Literature
Review, Diminishing Returns, Life Satisfaction