Abstract: Traditional economists suggest that more income will lead to greater well-being, while psychologists are more cautious on this question. They investigated the relationship between money and subjective well-being in many ways, and have drawn some think conclusions. Studies have shown that money has effects on subjective well-being through such mediate variables as personality, goals, motives, social comparison, adaption and stress. Future studies should improve on the research subjects and methods, and be more conducted on the psychological mechanism. What’s more, more studies based on the Chinese culture are needed as they have important practical meaning in China

Key words: money, subjective well-being, psychological mechanism