As economic inequality continues to rise, there is increased concern about both the consequences of inequality and what can be done to reverse this trend. In the present paper, we review the social psychology of economic inequality and redistribution, focusing on their effects on subjective well-being. We address who is affected by inequality and redistribution, what psychological processes link inequality and redistribution to well-being, and how (incorrect) beliefs about redistribution may underlie opposition. Although redistribution has been shown to promote well-being, which policies are effective in promoting well-being remains unclear. We also highlight current limitations, namely, limited understanding of the underlying psychological mechanisms, overlooking the multidimensionality of redistribution, culture and country-specific effects, and a more intersectional approach to who is affected by inequality. Taken together, initial steps have been taken to understand how policy can be used to promote a happy society, yet many questions remain.