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This paper intends to justify the argument that income is not the only factor affecting happiness and well-being. By focusing only on income, we ignore the other important components of happiness and well-being. With the help of data and empirical findings, this paper would bring forth the argument that; there has been only a very modest upward trend in average life-satisfaction scores in developed nations, whereas average income has grown substantially. At a given point in time, higher income might be positively associated with people’s happiness, yet over the life cycle it has been shown that happiness stays more or less unchanged. Undoubtedly, people with higher income have more opportunities to achieve what they desire as they can buy more material goods and services. In other words, utility increases with income, but the question posed here is that does this higher level of income translate into greater happiness?