A three‐tiered analysis of overall life satisfaction: Socio‐economic characteristics, satisfaction with areas of life, and personality traits.

Using Australian data, this paper proposes a three‐tiered model of overall life satisfaction as a function of socio‐economic characteristics and satisfaction with areas of life and personality traits. Mediation analysis through structural equation modelling is employed using data from the 17th wave of the Household, Income and Labour Dynamics in Australia (HILDA) survey. The findings provide evidence for the interconnectedness of the three tiers of the model and their joint contribution to overall life satisfaction. Personality traits have significant direct and even stronger indirect effects on life satisfaction, mediated by their effects on satisfaction with areas of life, which has been previously overlooked. Socio‐economic characteristics have significant indirect effects on life satisfaction, which are most often omitted in analyses of life satisfaction. Satisfaction with areas of life remain strong predictors of overall life satisfaction, but only alongside personality traits and socio‐economic characteristics. The findings provide new methodological insights into the factors contributing to the measurement of life satisfaction, "all things considered". Furthermore, results may support policy makers to target vulnerable groups and identify approaches to improve their well‐being. [ABSTRACT FROM AUTHOR]