Posted on April 26, 2007
Is Money Important?
Admit it. You think money is bad. Didnâ€™t we all hear that money is the root of all evil? In movies, we see the rich Dons and hacienderos owning big lots of land and mistreating their poor tenants who work hard in the fields. Itâ€™s the rich guys who have power and are bad! But then weâ€™re told to work hard in school, get good grades, graduate so we can find a nice 9-6 job, kill ourselves with overtime and maybe work abroad for dollars. We can work and make a living but we seem to believe we’re not supposed to have lots of money like the hacienderos or the Ayalas or the Taipans. You know, just enough! Because greed is a deadly sin!
I swear, Filipino children grow up with twisted financial outlooks. We donâ€™t have sound a sound national financial literacy program nor is explicitly seeking abundance and wealth through unconventional means (read: not employment) accepted.
There are many rants and raves on the topic of Filipinos and money. For now, letâ€™s first dispel your fear of money.
Letâ€™s get the basics out of the way, shall we? I tell you where money comes from, how it flows in the “economy”, its importance, and how to get over your fear of money and move on.
How money flows and its history
Where does money come from? In a literal and historical sense, you can pay a visit to the Money Museum at Bangko Sentral ng Pilipinas. The Museum showcases old coins and bills from the pre-Hispanic era to the present. In economic terms, (you’re not going to believe this) money flows from the sources (households and individuals) to the banks or financial intermediaries. The banks in turn lend the money to those who use/spend it and earn interest for the bank and for the source (lenders include other individuals, corporations, and investors). Sometimes, the spenders can source directly from the sources through IPOs or bond issues. This is the true story my friend – so read well. The big companies grow big by borrowing from the bank where you keep your savings accounts with lousy interest rates. Let’s delve into this irony another time, so let’s move on.
The short story is that a long time ago, for you (letâ€™s say youâ€™re an auditor) to get something you want or need (for example, a dinner of fried chicken), you needed to find a poultry owner who will receive your goods or services in return (so heâ€™d need an audit opinion). Now, what are the odds that youâ€™ll find a poultry owner, whoâ€™s probably a sole proprietor anyway, who needs his statements done? Come on. Youâ€™d probably too weak with hunger and fatigue knocking on every poultry, um, door, before you manage to find one willing to provide you with your dinner (that you still have to cook!) This is a somewhat drastic scenario of the old barter economy, so man was inspired to create a medium of exchange â€“ tada! Money! (It evolved from jewels, stones, precious metals, et cetera but eventually paper currencies and coins came out. Now, thereâ€™s even e-gold.) But you get it, we came up with money so that you can just pay that poultry owner with money because he knows he can use that money to get something else that he needs (because, duh, he doesnâ€™t need your audit opinion).
So, yes, you know money gets you what you want and need â€“ food, clothes, pretty girls, gas, cars, houses, books. If you have a lot, you get really nice food, really nice clothes, really pretty girls, really big houses in really nice locations (maybe even an island) and so forth. If you donâ€™t have a lot, well youâ€™re just poor â€“ which could of course drive you to work harder and be more entrepreneurial in making money consciously.
Value of Money
Is money important to your life? Yes, to an extent. Having money now means youâ€™re able to provide for yourself and for your family. Of course, you donâ€™t want to die right after college graduation â€“ you want to live till your in your 100s maybe so you can play with your grandchildrenâ€™s grandchildren (What a sweet thought!) From now till then, money will be very important â€“ youâ€™ll have tuition expenses, an auto and house mortgage, living expenses, country club memberships, meals and grocery expenses, cable tv subscriptions, and so on.
Unless you plan to be a monk, money in the form of income (having it or lacking it) will be very important to your life. Face it.
Now this may seem silly and you may have heard this before â€“ but it really does work. So just give it a shot.
Close your eyes and ask yourself:
If money and time were no object, what would you be doing right now? Where would you be? Who would you be with?
Picture yourself in that situation. Paint it with color, add sounds, add people and conversation. Describe it in your mind as if youâ€™re writing a book, as if youâ€™re describing it to me.
What do you see? What is it that you desire?
Live in your daydream for as long as you like then just finish this post, okay? Itâ€™s fun, right?
So, yes, I asked you if money and time were no object, what would you do? We grow up thinking that money and time limits what we can do. We have to dispel this way of thinking and empower ourselves â€“ because God gave man freedom of choice. He wants us to live well so that we can give well (contribute more to Church and community!) and do well. Come on, God doesnâ€™t want us to be poor and depending on others (borrowing money from credit unions, banks, relatives and friends)
Iâ€™m not saying to buy all you want, but do buy what are necessary and what would make you comfortable. Donâ€™t fall into over-consumption and excesses (because, now, that’s greed).
Give it a shot. Become financially independent. Be able to manage money so that you can live well, live the life you want and like without borrowing or depending on anyone else.
(So if you plan on being a financially independent housewife, youâ€™ll have to not depend on your husband to live the life you like.)
This is pretty heavy stuff. But thatâ€™s why money (specifically, income from assets) is important. It empowers, enables you to be financially independent.
Life you want = Life you like = Life you have
Thatâ€™s just beautiful.