How To Think About Money

Money matters. Money is what we use to put a roof over our heads, food in our stomach, and enjoy a better life.

However, there’s a problem. Most of us think about money too little or too much. If you think about money too little, odds are good that you’ll throw money away or make decisions that harm you later on. Think about money too much, and you’ll ruin your mental health and make your life way more stressful than it has to be.

Finding that happy medium — and understanding how money works in your life — is crucial.

How To Think About Money: Money Makes Life Easier

Look around social media, and you’ll see endless posts about wealth building, getting rich quick, and the rich kids of Instagram. Here’s a little secret: All of that stuff is nonsense.

You don’t want money for money’s sake. That’s silly. You want money so you can live a better life.

When you have more money, you have more opportunities to improve your life. Having extra money means paying off debts more quickly, buying things and having experiences that matter to you, and understanding that you can give to charity and help those around you anytime you want.

Most importantly, money provides a buffer against the many headaches and problems life throws up. Medical emergencies, parking tickets, urgent home repairs and unplanned expenses shouldn’t derail you financially–money helps make sure you have that crucial buffer.

How To Think About Money: Don’t Hoard Money

When you grew up without money and you suddenly have money, there’s an urge to spend that money right away before it goes away. Don’t do that.

But the alternative–holding onto your money forever–is an even worse idea.

When you have more money than you need for daily expenses and long-term plans, find a way to invest it. Or use it to pay off debt.

Investing means making your money work for you 24/7 to make more money. That’s a good thing.


How To Think About Money: Other Resources

All Your Worth: The Ultimate Lifetime Money Plan (Elizabeth Warren, Amelia Warren Tyagi)

I Will Teach You To Be Rich (Ramit Sethi)