Our society delivers two conflicting ideas about money, one by portraying the fortunes of having a lot of money and on the other hand they tend to inflict a notion about how money can’t give happiness, which is totally ironic. Probably at some point in your life you must have heard someone say that “money doesn't matter”. However, this sentiment sounds nice in theory, the reality is that money has a lot more importance than you perceive. So you shouldn’t underestimate the importance of money.
In this post, we try to expand our understanding of money and why it’s needed.
Table of Contents
- Why Is Money So Important?
- How Money Plays an Important Role in Our Life?
- How Much Money Is Enough?
- What People Think About Money?
- Educating Masses About the Right Usage of Money
Why is money so important?
We need food, shelter, and clothes for our survival. Most of the world could live without money if the above things were free, but they aren't. You can see around your house that every piece of equipment you own was bought with money, including the computer or lap on which you're reading this, the chairs, the bed, the house and so on. Money is not everything, but it is a basic necessity to survive in this world.
How Money Plays an Important Role in Our Life
First, it gives you freedom and choices. Money enables you to live anywhere you want, to take care of your essential needs, and to indulge in your hobbies. Money gives you the wings to your dreams and helps in accomplishing it. Money standardised our lifestyle and many more.
Money Gives You Freedom and Choices
Money can give you the freedom to choose where you live, what you eat, what you wear, and what you do with your time. It can also give you the freedom to travel, pursue your hobbies, and help others.
Money Gives You the Power to Pursue Your Dreams
Money can give you the power to pursue your dreams, whether they are big or small. For example, if you dream of starting your own business, money can help you get started. If you dream of traveling the world, money can help you make that dream a reality.
Money Gives You Security
Money can give you a sense of security knowing that you have enough to cover your basic needs and unexpected expenses. It can also give you peace of mind knowing that you have a financial cushion to fall back on if you lose your job or have other unexpected financial setbacks.
Money Can Create More Life Experiences
Money can give you the opportunity to have more life experiences. For example, you can use money to travel to new places, try new things, and meet new people. These experiences can help you grow as a person and make your life more fulfilling.
Money Helps You Give Your Family More
Money can help you provide for your family and give them the things they need and want. It can also help you create memories that will last a lifetime. For example, you can use money to take your family on vacations, send them to good schools, and provide them with healthcare.
Money Lets you Give Back
Money can help you give back to your community and make a difference in the world. You can use money to donate to charities, volunteer your time, and support causes you care about. When you give back, you not only make a difference in the lives of others, but you also feel good about yourself.
Rather than relying on the answers of any rich preachers about the importance of money, if you are seeking for an authentic answer, ask a father, who has got this notice, “Won’t let your daughter sit for the exams, if you don't clear the fees”, ask a daughter/son, who is unable to buy medicines for her/his ailing parent. Ask a kid, who knows that his mother is lying, that she had enough food and doesn't feel like eating anymore.
How Much Money Is Enough?
The question of how much money is enough is a personal one. There is no one-size-fits-all answer. The amount of money that is enough for one person may not be enough for another. It is important to consider our individual needs and goals when answering this question.
For some people, the goal of financial independence may be to have enough money to cover their basic needs and expenses. This may include things like food, shelter, clothing, transportation, and healthcare. For others, the goal may be to have enough money to travel the world, start their own business, or give back to their community.
There is no right or wrong answer to the question of how much money is enough. The important thing is to find a balance that works for us and that allows us to live a happy and fulfilling life. Here are some things to consider when answering the question of how much money is enough:
- Your current lifestyle: How much money do you currently spend on your basic needs and expenses?
- Your future goals: What are your long-term financial goals? Do you want to retire early? Start your own business? Travel the world?
- Your risk tolerance: How comfortable are you with risk? Are you willing to invest your money in risky assets in order to potentially earn a higher return?
- Your time horizon: How long do you have to reach your financial goals? If you have a long time horizon, you can afford to take more risks with your investments.
Once you have considered all of these factors, you can start to develop a plan for how much money you need to save and invest in order to achieve your financial goals.
Here are some general guidelines for how much money you may need to save and invest in order to achieve financial independence:
- To cover your basic needs and expenses: You may need to save 10 to 20 times your annual expenses.
- To retire early: You may need to save 30-40 times your annual expenses.
- To start your own business: You may need to save 6-12 months of living expenses. This will give you a cushion in case your business does not generate enough income in the early months.
- To travel the world: You may need to save 1-2 years of living expenses. This will allow you to travel without having to worry about money.
- To give back to your community: You may need to save 1-2 years of living expenses. This will allow you to donate money to charities and causes that you care about.
These are just general guidelines. The amount of money you need to save and invest will vary depending on your individual circumstances and goals. It is important to speak with a financial advisor to develop a personalized plan for your financial future.
In his latest episode of Conversations with Rakesh, SoME founder & CEO, Rakesh Godhwani addresses the misconceptions on the importance of money and acts as a guide to help the readers understand the concept of money by stating various examples.
What People Think About Money?
There is this lovely song in a movie called ‘Karz’ one of the landmark movies of Indian cinema of Rishi Kapoor and this movie starts with this song which is called paisa paisa and the lyrics of the song are amazing, one of the most important line on money is “if you have it it's a problem if you don't have it it's a problem” that's all the more reason why we should talk about it and we should learn how to deal with it. Learners and even professionals, our single most important priority unfortunately is to earn a livelihood.
All of us have decided to live in cities or towns in search of jobs which pay you well and you need good houses, good lifestyle, good education, good health care, none of this is cheap. The people who have a lot of money are the people who will give the lecture that money is not important, which is ironic and I'm sure they must have worked hard, they must have toiled every minute of their life to earn it. Now when they have a 20 room bungalow and a Mercedes and a private jet, they are giving lectures that money is not important, it is really absurd.
Educating Masses About the Right Usage of Money
At School of Meaningful Experiences, we believe in educating our learners about the importance of money in life and the value of money. We should help our learners to respect money and get used to the concept of it, especially young children who may not have a clear idea of where money comes from. They may think it comes from an ATM or grows on trees, but it's not their fault. We, as adults, need to invest time in teaching our children about the importance of money and how to earn it with the right approach.
An important research study conducted on poverty highlights that people who don't have enough money are more likely to make bad decisions, such as taking out loans with high-interest rates, just to meet their basic needs like healthcare, education, and food. As a result, they can get completely sucked into the spiral of poverty.
This is where the importance of money in life becomes evident. Money helps us live a better life. If you have it, then you can enjoy it and pass it on to others, creating a virtuous cycle that benefits everyone.