Money really can buy you happiness, but you're probably spending it wrong, according to a new book by Harvard professor Michael Norton and co-author Elizabeth Dunn of the University of British Columbia.

A new book out of Harvard and the University of British Columbia outlines research-backed strategies for the improbable: buying happiness.

Authors Michael Norton, an associate professor at Harvard Business School, and Elizabeth Dunn, an associate professor of psychology at the University of British Columbia, began looking for spending strategies that could make people happy after meeting at a summer camp while they were both graduate students. In addition to surveying consumers about their spending habits, the pair also conducted a series of experiments where they handed out envelopes of money with instructions on how to spend it. Later, they called participants to ask how they felt about their purchases.

Their results, presented in "Happy Money: The Science of Smarter Spending," suggest money really can buy happiness, Norton said, but only if you know how to spend it. Buying material goods, such as new clothes or a car, brought consumers no additional happiness. But buying experiences, such as dinner with a friend, did.

Norton said spending strategies that did in fact bring added happiness were often counterintuitive.

"Money has an interesting property, where when you get money, you tend to think about yourself," he said.

Like those who spent their money on experiences, instead of things, those who spent money on others reported greater happiness, particularly if they spent that money on someone close, Norton said. But spending money to treat yourself could also bring happiness, so long as it remained a treat.

"Turns out that even when we like things, if we get too much of them, we get tired of them," he said. Even with mundane purchases, such as a morning coffee, going a few days without can heighten the enjoyment they bring later on.

Paying for items upfront, and then waiting to enjoy them, also brought additional happiness, Norton said, and another factor in the money-happiness relationship was the investment of time required for new purchases.

"Anything that you buy, think about what it will cost you in time," Norton said. "With a TV, what you're really buying is hours and hours in front of a screen by yourself — and that's not good for your happiness."

Whether or not a purchase brought happiness ultimately boiled down to how that purchase impacted the consumer's time and relationships. Despite the study's focus on spending, Norton said it was highly possible that money was simply a proxy for social experiences.

"We're partly trying to change how you spend your money," he said, "but we're also trying to change how you spend your time."

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