Why is money important to you? The quick reply may be “it helps me pay my bills” or “it keeps a roof over my head.” These answers may be true, but I want to go deeper as we explore the role of money in our lives.
Money has tremendous power in our society. It has a dark side, which I am reminded of as I watch the national news. Currently (early August), a wealthy, high-profile man is on trial accused of hiding millions of dollars in foreign countries and not paying U.S. taxes on these accounts. I do not know what the verdict will be, but hiding money to evade taxes is never wise.
In addition, we hear of wealthy dictators who are living an opulent lifestyle, alongside their incredibly poor countrymen. Many people place money on a pedestal and worship it. In my view, their priorities are out of line. They often have lots of debt because their attempt to “keep up with the Joneses” leads them to a lifestyle focused on materialistic possessions.
Fortunately, many people have a healthy attitude toward money and are very generous. The Bill and Melinda Gates Foundation contributes millions of dollars for health services internationally and educational initiatives in the U.S. However, you do not need to be wealthy to be generous. Many people – regardless of their income level – are eager to help others who are less fortunate than themselves.
So, the problem is not money itself. In fact, I am convinced that money can increase our happiness if it is managed wisely and spent sensibly. One of my favorite quotes is by psychologist Daniel Gilbert: “Money itself doesn’t make you happy. What can make you happy is what you do with it.”
While writing my book “The Joy of Financial Security,” I researched the relationship between money and happiness. I strongly believe that money does not buy happiness. In other words, it does not guarantee happiness. Many wealthy people are very unhappy. However, money can definitely increase our happiness when we use it correctly.
So, let’s go back to the original question. Why is money important to you? Many people would say that money is important to them because it provides freedom. Two other common answers are time and financial security. Let’s review what these may mean. Your answer may be completely different.
Freedom may include paying for your kids to go to college. My grandmother paid for my college and my husband put himself through college. Therefore, being able to afford college for our daughters was an important goal for us. Freedom may include owning a home, being able to retire when you choose, being generous with gifts to charities or family members, or traveling where and when you choose.
Time is another benefit of having money. If a person has enough money, they can hire someone to clean their home, wash their windows and paint the garage. They can even hire a bookkeeper to pay their bills. For people who work full-time, the saying “time is money” is clearly understood.
Financial security is often a benefit of having enough money. My definition of financial security is “the amount of money you need to feel confident that you can pay your bills, live the lifestyle you want, achieve your goals, and not run out of money before you die.” For some people, the amount of money needed for financial security is not large. For others, it may be much more. Financial security helps you sleep at night, knowing your financial future will be safe, regardless of what economic or personal crises may come your way.
While you are pondering why money is important to you, I encourage you to think about your values. Think about how money can be used to make you happier, and what is more important to you than money.
Consider any of the following (and much more): strong relationships with family and friends, having a sense of purpose, giving back to your community or to others less fortunate, leading a healthy life, keeping your lifestyle simple, expressing yourself creatively, setting realistic goals, feeling a sense of gratitude, being a lifetime learner, increasing the amount of laughter each day, and accepting change.
As you explore the ways that money can increase your happiness, you may realize that you already lead a very rich life.