The Money, Budgets and Personal Finance Primer. Part 1

“Money Makes The World Go ‘Round!”

What is Money, Anyway?

Simply put money is a tool. That is all that money is. Money, or currency, is a tool that a society has agreed to accept as a form of payment for trade. Historically, items that have been used for currency have varied from shells and stones, to gems and coins. Basically currency as a tool is something that a society has deemed to be and has accepted to have value. With the accepted value, two or more people can then trade their goods produced or services provided to someone wanting those goods or services for currency – money.

Economics 101

At its most basic level, Economics is the study of the art and science of the trading of goods and services between different parties. Therefore economics starts with the basic premise of Supply And Demand. The “Supplier” has the supply of the goods or services and the “Demander” wishes to trade something to get those goods and services. The intersection where both the Supplier and the Demander agree on what the value of the goods and services that are being supplied is the accepted “market price” of those goods and services.

In any society that has mutually agreed upon the value of a currency, the trade or exchange between the Supplier and the Demander can successfully take place. Note that when the market is allowed to work in this manner, both parties walk away from the exchange satisfied with the result. The exchange has enabled a “win-win” situation since the Supplier was able to sell their goods and services at an acceptable price (value) for them and the Demander was able to obtain the goods and services that they required by paying an acceptable price (value) for them. Win-win!

So, it all comes down to this, in our modern society, money is the accepted currency of two parties trading for goods and services. Money is the tool of value that allows the trade(s) to occur.

Money Is The Root Of All…

Since money is just a tool that can be used to accomplish an end result much like a hammer is a tool, money by itself is inanimate and indifferent. Since money is nothing more than a tool, we need to realize that the desire to earn money and attain wealth, if done properly and for the right reasons, is absolutely nothing to be ashamed or afraid of. If we are wanting to earn money to have a roof over our heads, food on our tables and otherwise provide for ourselves and our family, and once that is accomplished to provide of our future, the desire to earn money is an honorable, noble and very much required goal!

“Wait a second, we are always taught that, money is the root of all evil”, you say.

That saying is an enormous untruth.

The real truth about money is that:

“Money Is The Root Of All Good!”

“How can that be?”, you now ask. “People have done and still do so many horrible things because of their desire for money”. “People have lied, cheated and even killed other people for money!”

In All Things, There Are Two Options:  Build Or Destroy.

Unfortunately what you have said about people is all to true. However, keep in mind that money is just a tool, exactly in the same way that a hammer is just a tool. A hammer can be used by anyone that knows how to use it to fix and build great, many and wonderful things! Give the hammer to a skilled carpenter and there is almost nothing that they cannot build or fix with it. But the hammer can also be used for destructive purposes – to destroy things and even as a weapon to hurt or kill someone. Again, the hammer is just a tool. If a hammer is used in a destructive manner, judging the hammer to be morally bad is silly! Even more foolish would be to judge the hammer to be responsible for the destruction that had occurred when the hammer was used. We do not punish the tool for how it was used.

And so, since money is just a tool, much like a hammer is just a tool, judging money to be the source of and responsible for bad, horrific and evil things that were done with a hammer, is not only foolish, but it really is quite absurd. When a hammer is used destructively by the wielder of the hammer, we do not punish the hammer – It is the person that used the hammer that is judged and punished. Simply put, the hammer is neither good nor evil. The hammer is just a tool available to be used. How the hammer is used is the sole and only responsibility of the person using the hammer.

If Money Is Just A Tool That Would Mean…

The exact same analysis of the hammer applies to money. Money is neither good nor evil. Money is just a tool available to be used. How money is used or acquired is the sole and only responsibility of the person using or acquiring money. Money can be used to do some great and wonderful things. Among many wonderful things that money allows us to do, money allows us to eat. Money allows us to live and sleep in a safe place, staying warm and dry. Money allows us to educate ourselves and our children. Of course, a person’s uncontrolled desire for money may mean that people with those desires may do inappropriate things to attain the money, but the money did nothing more than being an available tool. People make their own choice on how they act with regards to the tool of money. Money, by it’s very definition, cannot choose how it acts or is acted upon.

Therefore the correct saying with regards to the evil in the world, is not that “money is the root of all evil.” No! This is simply not true! Rather, the true and real saying is that:

“People Are The Root Of All Evil.”

Having a desire for money should not ever bring any man any shame. How a man chooses to attain his money and what he may do with the money that he attains is, very much up for and open for discussion. But that will be a discussion for another time. The purpose of this particular article is to get men to better understand what money really is and to clear their minds about the big fallacy about money that has been propagated for far too long a time. The inexcusable, horrific and damaging result of this fallacy is that it has probably caused many men to feel guilty about money and wanting to have money, for no reason at all.

Get Past The Guilt

The first step to financial freedom and accumulating wealth, in a noble and honorable manner, is for us men to get past any feelings of guilt that we may have with our desire to have money. There is no shame in wanting and getting money for the right reasons and when the money is earned in the right way.

The guilt about money that has been instilled in us comes from the false belief that money is the root of all evil.  Firstly, the correct quote is “The love of money is root of all evil”. Secondly as we have discussed, money is just a tool and how people use the tool is up to the person using the tool and not the tool itself.  

Here some other erroneous beliefs that come from the guilt of our relationship with money:

• I don’t deserve to have money.
• I can’t be spiritual and have a lot of money.
• I shouldn’t have any more money than I need.
• I don’t want to turn into a snob
• I will probably just lose it all, anyway.

This list is by no means comprehensive.  There are more silly beliefs like the ones listed above. Be honest with yourself – When you read the above list the voice in your head was the voice of your inner five year old. Right? These are the exact same type of excuses that a five year old would say when they did not get something that they really wanted.  

“I didn’t need a new bicycle anyway”.  “My old one is okay”.  

“I don’t need more money”.  “I will probably just lose it all, anyway.”  

What?!?  Are you you kidding me? How pathetic is that! Stop fooling yourself.  You want money.  Money is a good thing to have. Maybe there is an upper limit to how much you really need, but come on! It should be safe to say that we could all use some more money in our lives.  

Look, if you had more money you could do more of the goods and important things in your life. Think about your life right now. What could you do with an extra thousand dollars? What about an extra ten thousand dollars?  There is no doubt that you can do some good things for your self or for your family if you had extra cash in your life. The ugly truth is that if the money was there the excuses would fall away. 

Money itself may not be the actual problem here. Getting there could be the actual problem for most of us.  The guilty relationship we have with money is what stops us from seeing and getting on the road to financial freedom. It’s a long road, yes. But you can travel the road. Just get over your guilt of money.

Simply put money gives you the freedom to choose to do the good things that you want to do.  Money is good.  We are good. We are good with money. (Good psychologically speaking.  Being good with managing money is what we are working here!)

Now that we can agree that we like money and we like money for the right reasons, Part Two of this series will talk about budgets and why they are so important for our financial success.

Part Two to this article is here. Click the link to read more on Money and the first step to financial success – Making a budget.

Constructive comments, questions, tips and ideas are always welcome!

What about you? What are your thoughts about money? Have you been able to get past any guilty feelings about money?

 

Be A Man – Do The Right Thing. Take Care Of Yourself And Your Money.