I think the optimal spending for most people -- i.e., the amount of spending that would maximize happiness -- is far lower than the amount that most people actually spend (in large part b/c people work at jobs they don't love to earn money to buy stuff they don't need). Much of it is wasted on mindless luxury that people come to believe is necessary and that doesn't really increase happiness because of hedonic adaptation: http://en.wikipedia.org/wiki/Hedonic_adaptation Here's Mr. Money Mustache's piece on hedonic adaptation: http://www.mrmoneymustache.com/2011/10/22/what-is-hedonic-ad...