What Lies Beneath

Jonathan Clements

MONEY IS A TOOL. But a tool for what? We might imagine it’s simply a way to purchase the goods and services we need or want. But in truth, there are all kinds of things that money can do for us—some worthy, some not so much.

Want to use your wealth more wisely? I think all of us should spend time pondering what money represents to us, how we use it and why we like to have it. Here are just nine of the reasons that folks look to amass money:

1. More options. I’ve heard folks describe their savings as “f— you” money, offering the chance to give the middle finger to the boss whenever work becomes unbearable. Less crassly, others have said money represents “stored energy” or “financial freedom.”

The notion: Even if we aren’t currently putting our money to use, we know we could—and that potential is one of money’s most appealing qualities. I agree, though I’m also aware that the seemingly endless options offered by money come with a catch: As soon as we take advantage of them, our pool of money dwindles, and with it our financial options.

2. Financial security. “You’ve saved all that money. When are you going to spend it?” I’ve long thought “never” was a perfectly fine answer.

Money may represent the financial freedom to purchase all manner of goods and services. But instead of buying things, we can use money to buy freedom from worry. In a world where many—and perhaps most—folks fret constantly about their finances, I think the freedom not to worry about money is one of the top reasons to amass some savings.

3. More time. Research has found that, if our goal is greater happiness, one of the more effective strategies is using money to pay others to do tasks we find distasteful, whether it’s cleaning the house, mowing the lawn, painting the bathroom or whatever else makes our personal list of loathsome tasks.

This strikes me as a wise way to spend money: Time is the ultimate limited resource, and we don’t want to squander it on tasks we loathe. But—fingers crossed—having money should also save us time for another reason: Once we have a healthy sum set aside, we should be able to spend less time worrying about financial issues.

4. Fewer hassles. Money doesn’t just allow us to pay others to do tasks we find distasteful. It can also make life easier and less stressful. Travel is an obvious example. Thanks to money, we might take a taxi rather than a bus, or fly first class rather than economy.

Still, if we aren’t careful, money can have the opposite effect, resulting in even more hassles. For instance, emboldened by our fat financial accounts, we might buy another car or purchase a second home. These additional items might seem like they’d enhance our life. But often, they quickly become a burden, because we now have to care for these possessions, with all the wasted time and hassles that are involved.

5. Helping others. We tend to focus on how we might use money to benefit ourselves. But don’t overlook the pleasure of using money to help others, including both family members and nonprofit organizations. If it weren’t for this pleasure, I suspect that today I’d have scant interest in earning further money or continuing to work. But I still enjoy both—because of the happiness I get from using my time and money to help others.

6. Better health. Have you ever not gone to the doctor because of the potential cost? Do you regularly favor fast food and frozen meals because they’re less pricey than preparing your own food? Are you so busy with work that you can’t find time to exercise? Have you ever lost sleep worrying about money?

For some, the connection between life’s financial demands and poor health couldn’t be more obvious. For others, it’s more subtle. But the effect across the population is clear: Based on life expectancy as of age 50, the top 20% of U.S. income earners live a dozen years longer than those in the bottom quintile.

7. Pride. Money is a key yardstick for measuring worldly success. Sure, we might be a better society if our preferred yardstick was how hard folks work, or what they achieve, or how many friends they have, or how much happiness they deliver to others. But these other attributes are harder to measure, while money is a straightforward, easy-to-grasp yardstick.

Is it bad to focus on money and take pride in amassing more or earning more? I don’t think so. Measuring such things can provide great motivation. But for our own peace of mind, the ultimate goal shouldn’t be “more,” but rather settling on a number where we’re willing to declare “enough.”

8. Status. For money to accord status, others need to know we have it. But how? Folks are unlikely to brag about the size of their portfolio or paycheck. Instead, they typically signal their financial success with their purchases. This, I believe, is one of the biggest drivers of wasteful spending, though presumably the spenders don’t see it that way, instead viewing the admiring glances they receive as evidence their money has been well spent.

9. Power. No, we might not be spending millions to support our favored political party or to get ourselves elected. Even so, money can be a source of power—or lack thereof. For instance, the family breadwinner often ends up with a bigger say in how the household’s money gets spent, leading to resentment or worse.

Anything missing from the above list? Oh yeah, we could spend the stuff. But as you might gather, spending—or not spending—is often just a manifestation of the reasons listed above. We might think we’re buying a bottle of wine, or a vacation, or a house. But often there’s a complicated stew of motivations underpinning what we do with our dollars.

Jonathan Clements is the founder and editor of HumbleDollar. Follow him on X @ClementsMoney and on Facebook, and check out his earlier articles.

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