They say money can't buy you happiness – but the experts seem to disagree. In fact, happiness could cost as little as £38 a week – that's just over a fiver a day!

It sounds like a sales pitch for a pointless new self-help gimmick, but that figure actually comes from some quite serious research. According to insurance company SunLife's “Cash Happy” survey, the happiest people in the UK are only about £5.50 a day better off than average. They asked 3,000 British families about their spare income, spending habits and how happy they felt. The results were pretty eye-opening.

£167 a month to be happy

It turns out you really don't need to be a millionaire to rank with the happiest UK households. The average UK family has around £44 going spare at the end of the week. Compared to the happiest, there's actually not that much of a difference. An extra £167 or so a month is about all that separates them once the bills are cleared away.

Strangely enough, getting richer after that doesn't seem to have a huge effect. Once a household tops about £500 spare each week, they're generally no happier than when they hit that magic £167 above the average. What the survey shows above all is that there's definitely a link between the cash you have on hand and how happy you are. The interesting thing is that it's spare cash, rather than actual income, that makes the difference. That means you really don't need to have millions rolling in to go toe-to-toe with the UK's happiest families.

Who's the happiest?

So let's see who's hitting that mark. The Cash Happy study found that:

  • People living with partners and dual-income families have the most to spare at just over £100 per person each week. That adds up to £878 a month over their basic needs!
  • Younger families and “empty nest” households are averaging £607-£611 unspent at the end of the month.
  • As families get older, their spare income comes down a little at around £474 a month.
  • Those least flush after paying their bills include people living alone or sharing with housemates. They're averaging between £157 and £207 spare per month.
  • However, age is a major factor. The over-50s seem to scrape together around £100 more each month than the younger crowd.
  • It's worth remembering that, for a lot of people, even having something left over can be a big ask. 5% of the people surveyed reported that they were going a grand or more overdrawn most months.

What do people do with their money that makes them happy?

Another interesting point is that the happiness doesn't necessarily come from actually spending the money. In fact, the most common thing people do with their spare cash is save it! That's right – even banking the £194 a week it takes to hit the top 10% household happiness bracket still works.

Of course, that's not everybody's decision. Other popular uses for extra cash range from holidays and clothing to  cinema trips and eating out. After all, it's your money and we're not going to tell you what to do with it.

How can I get some extra cash and be happy?

If you did ask our opinion, though, we'd probably make one main observation. It's a whole lot easier to hit your spare cash targets if you aren't leaving wads of the stuff in the taxman's trousers.

With HMRC sitting on around £800million in unclaimed tax refunds for expenses each year, that's a lot of potential happiness going to waste. Talk to RIFT to find out if you're owed a refund from HMRC. It costs nothing to learn where you stand, and it could mean clawing back thousands of pounds in overpaid tax.

We've been in the industry since 1999, making us the UK's leading tax rebate and tax return expert.