5 False Beliefs About Money
It’s not having money or having a lack of money that’s the problem. It’s how you identify with the money you have.
It’s not having money or having a lack of money that’s the problem.
It’s how you identify with the money you have.
Over time I’ve (struggled) and sought to change the relationship I have with money.
Here are 5 mis-identifications to untangle:
Separating money from value.
How valuable is time spent with your best friends ? How much does it cost? How valuable is hearing your child’s first words? How much did you pay for that? Money and value are only loosely correlated and much of what we value most we don’t spend money on. It doesn’t cost money to breathe air or watch the sunset.
Separating money from creativity.
Some of the best artists in the world were broke for decades. It’s possible that money and creativity are inversely correlated. Which might have to do more with constraints. An old mentor of mine always told me:
”The best assets of an entrepreneur are having no money and being naive.”
Creativity, and art, are about turning nothing into something beautiful. So having nothing can help.
Separating money from time.
Leverage grows money more than time grows money. Billions of dollars can be made in a 2 minute trade. It can grow really slowly at a small interest rate, and it can decline all at once.
Money’s relationship with time changes in it’s context. How much does having money earlier in your life matter, relative to later in your life? I can see good arguments for both sides.
Unfortunately, money has diminishing returns when it comes to buying your time.
Money spent at age 18 is *not the same* as money you spend when you’re 65, because the opportunity set of what you buy and why are different.
Separating money from self-worth.
This one has been the most difficult for me. It’s so easy to use money as a type of scoreboard, and it’s so easy to believe that your value is growing or diminishing based on what that account has. You start to equate money with value. Like we’ve seen above, there are many types of value that don’t show up “economically.” Not only that, when we start to measure purely economics, we often kill the magic of what we want. Artists who monetize their hobbies can find themselves missing the simpler life of not having their art be purely for productive means. Maybe an easier phrase than “self-worth” might be love or dignity. Niether love nor dignity are advanced by monetary means. You can’t pay for (real) love and dignity, humanity has no price tag.
Separating money from your job.
You start to realize that YOU are the one who makes money, not your job. The money seeks you out, through whatever avenues you choose to pursue. You can make money through many avenues and many opportunities. The world of possibilities is constantly changing. New career types emerge. A job is just one format for receiving money. Across your life you might have many careers, and the common denominator that produced money was you, not the job. After all it’s your name on the paycheck not your title.
What perspectives, identifications, or ways of viewing money have helped you?
xx David
to my experience, point 4 is the key one, from where the others descend, apart maybe point 3
my mother had ever measured everything with financial success, ever piled money and burned relationships: she's now a very wealthy old lady, living alone with a miserable health, refusing to spend a dime to pay someone's assistance
she had never forgived me for refusing to run family business (leather goods and shoe shop) to follow my inclinations when I was young and very later on she didn't help me financially when I founded my business, both when I started (I actually didn't ask her help) and later, when the business showed it to be solid rock and I needed to scale (and asked her help, guaranteeing her to refund)
being the only child of such a person could shatter you in pieces if you don't learn very early in your life that money is no metric for self-worth