An afterlife would be terrifying for me

[Apollo]

So the “happiness “ becomes more abstract in middle ages.

Hmmm... I don't quite see where this would follow from what I said. Theology in the Middle Ages followed on directly from Greek philosophy. If happiness is presented as something abstract in the Divine Comedy then it's also abstract in Plato's Symposium. 

Sure. Makes sense.  My point was that a lot of ideas and knowledge are incremental built upon other cultural ideas. e.g. Plato did not come up with the notion of "afterlife" nor did Dante. They inherited it from their culture/previous generations and build upon it with respect to their appetite, which in their case was more philosophical and abstract.

 I am guessing because mere worldly rewards were no longer inaccessible for many to yearn for material things but rather people with more fed bellies needed more intellectually stimulating ideas of reward system in afterlife. 

So while ancient Egyptians worried about wealth and slaves and utensils in afterlife and packed them up with pharaohs, medieval people had more self-actuating ideas about afterlife and focused more on the “spirit” than carnal desires.  This to me sounds like evolution in human conscious and abstract thinking.

Egyptian culture lasted a long time. Were people in the time of the pyramids particularly worried about material conditions -- more so than in Plato's Athens or Dante's Florence? Were those who were in material need the same ones who made up their theological rituals, or was this the role of an elite class? I'm not sure if the facts are in keeping with your explanation here. 

Were Egyptian burial rituals developed during a time of material hardship and then unchanged for millennia? Remember that the time between the building of the pyramids and Cleopatra's life is greater than the time between Cleopatra's life and now. There was "abstract" philosophy going on in Egypt -- did it have an affect on ideas of the afterlife?

Your explanation sounds like a just-so story to me -- too neat and too much in conformity with modern prejudices to be persuasive. I think you've started with a theory -- that ideas of the afterlife are fantasy extensions of what we want in this life -- but I'm not convinced yet that this is generally true. To be confident I think we'd have to do a lot more research.

The afterlife as depicted in Homer is horrible -- the opposite of a wish-fulfillment fantasy. The final goal of the afterlife in Indian and Buddhist philosophy is generally seen as the total extinction of the individual. So these, too, would work against your theory.

Not necessarily.  Every culture has its own view of afterlife.  For Mohammad and his followers having abundant of sex in afterlife was of prime inspiration, for Buddha, something different deeper was important. So all these guys came up with different view of afterlife.  But core idea of afterlife itself is many millennia old and goes back to what archaeological digs show us believing that dead would rise and would have a life.  I think going back, say, 20,000 years, people's idea of afterlife was not that abstract and was more in line with their physical realities.  I think a lot change after writing was invented because knowledge could be stored and transmitted with more fidelity and that helped boost more abstract ideas to be transmitted.

(Again, this is inference. I have no way of getting into ancient Egyptian mindset as to why they preferred utensils and food to be buried with the dead instead of any alternative. But food and utensils point to very few logical possibilities).