While a trove of research has confirmed that wealthier people do tend to be happier, a new paper from Matthew Killingsworth, a research fellow at University of Pennsylvania's Wharton School, further proves that hypothesis. His research finds that the correlation between your paycheck and your happiness holds extremely true across a vast range of incomes. 

"The shape of this relationship is remarkably systematic," Killingsworth tells CNBC Make It. "There doesn't seem to be any specific point where money stops mattering." 

Killingsworth's newly published research builds on some of his previous findings on the relationship between incomes and happiness, and confirms the positive correlation between money and life satisfaction. Further, it shows that the psychological effect of more money is relatively the same across income brackets.

In other words, if a person earning $200,000 a year and a person earning $50,000 both receive a 20% raise, the relative increase to their happiness will very likely be roughly the same.

However, the lower-earner may feel more of a material effect from the raise. They may go from living paycheck to paycheck to being able to save each month, whereas the higher-earner may simply elevate experiences they were already enjoying. But in terms of quantifying their joy, the raise has about the same effect, Killingsworth says. 

Of course, a number of other individual factors may affect your overall wellbeing too. 

"Money is one of many variables [in] the equation for happiness, and no single variable dominates," Killingsworth says.

Everyone needs a 'happiness portfolio'

These findings may make it tempting to chase a bigger salary.

"When people earn more money, they feel more control over their lives — essentially, they have more freedom to do what they want to do," Killingsworth says.

But how you go about earning extra cash could actually be detrimental. Ultimately, it's not about what you buy or how much you spend, but "about being able to live the life you want to live."

If making more money means you have to sacrifice spending time with your loved ones or enjoying hobbies in your free time, there's a good chance that extra cash won't make you happy. 

"Each person needs a happiness portfolio because there are a bunch of different things that matter for happiness," Killingsworth says. "Money seems to matter, and I think maybe a little bit more than we previously thought, but it's also only one of a bunch of things that seem to matter."

Your happiness portfolio may include a variety of factors, such as your home, your relationships and your career.

Killingsworth also suggests identifying an income level you can achieve without sacrificing too much. How can you maximize your earnings while doing something you enjoy?

If your career offers upward mobility, "maybe it's worth thinking [about] working a couple extra hours a week to eventually earn way more," he says. That kind of trade-off may be worth it in terms of how significantly the higher pay could affect your life satisfaction.

On the other hand, if you're pursuing a career solely because of its high income prospects and you're not fulfilled by it, the salary alone probably isn't going to bring you the happiness you want.

"Earn what you can and then seek happiness in other aspects of life, and it's going to be perfectly possible to live a really happy life," Killingsworth says. 

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