Before you can decide how to invest your money or how much to stash away, it’s important to ask yourself the fundamental question:
• Why care about money?
The answer is harder than you think.
The Usual Suspects:
Sure, you know you’re supposed to grow up and get a job. You know you have bills to pay, a car to buy, and a home to live in. But what if you are the type of person who is fine with a smaller house, an older car, and less material possessions? Would you then care about money the same way I do?
One of the worst things about having personal finance for a hobby is that everyone assumes you are greedy or vain. “All he ever thinks about is money so he can buy more stuff”. Unfortunately, for some people, that IS why they care about money. But not me.
Why I Care About Money:
I would say I like nice things just as much as the next person, but I also remember my roots enough to know when enough is enough. Believe me, I’m no Kardashian.
When I was a senior in high school, I got a big lesson in why it’s important to care about money. I was a straight “A” student and was accepted into some very nice colleges. I was extremely excited until my parents had to break the news to me:
• There was no way we were going to afford to send me away to a non-local college.
My parents truly did the best they could, but the simple fact was that there wasn’t going to be enough money for me to both move out and go to college. Not wanting to take out student loans, it was then that I had to make a strong commitment to work part-time as much as possible until I had enough cash to make up the difference.
And ever since then, money has represented something more powerful than material possessions:
• Money represents opportunities
What Kind of Opportunities?
Yes, for me, money represents the ability to open doors that I never could have opened before. Ask yourself if you could do the following to full potential without money:
• Not just buy a bigger house, but a safe one in a neighborhood where you don’t have to worry about your children playing outside?
• Not just buy a new car, but a reliable car that you can confidently transport your family in?
• Pay for unexpected medical expenses?
• Look forward to the possibility of retirement?
• Send your children to the best schools, universities, colleges, classes, etc.
• Donate to your favorite church, mission, passion, or good cause?
• Care for your parents who may need you in their elderly state?
• Get life insurance (or any insurance at all) for your loved ones so they would be in good hands in case you were to surprisingly and suddenly pass away?
• The chance for you and your family to see and experience other parts of the world?
• To be able to leave something behind for your loved ones or a special cause after you are gone?
• Experience an overall higher standard of living?
Sure you may argue that you could accomplish all of things at any stage in your life. But I would argue that having money would make each of these opportunities much easier to manage.
Making Things Happen:
When you read this blog and think about what your goals are for investing, don’t limit yourself to just wanting a new car, bigger house, or new “whatever”. Think about all the things you could make come true for yourself, your loved ones, and the causes you believe in.
Life was meant to be lived, and in many situations it takes money to make that happen. Simply saving your money without a purpose is nonsense. When you save, make sure it’s for the right reasons.
* This post was originally published on 1/02/2012.
Photo Credit: Money by Sh4rp_i, on Flickr