Personal Finance Part 24 – What Does Money Mean To You?

In the quest for financial freedom, I wonder how many of us have stopped to ask ourselves the above questions – what actually does money mean to us and what does it symbolize? What I mean is – how should one go about thinking about money and how it can enhance your life? After all, money acts as a medium of exchange for goods and services and is not a means to an end in itself. The problem is that many people like to worship money as a God, and would willingly prostrate themselves in front of the God of Fortune (and Chance) just to scrape a little more money.

Living a Life of Abundance

To many of those I see around me, money is a way of living a “full” life – one of abundance and filled with material goods and possessions. Money can buy you many items and having more of it means you can essentially have more control over what you purchase. A poor person may be forced to shop at NTUC for the best discounts and value for money products while a middle-class family may be able to shop at Jasons or Cold Storage. Money, viewed at from this angle, gives us more flexibility and choices in life and enables us to experience more of life, as compared to a person living hand to mouth. Thus, the pursuit of wealth and money in this case is to ensure one can live life to the fullest and enjoy all that life can offer.

For me, I certainly endorse this aspect of money as I believe that one should ensure one’s life and family can live comfortably, and be able to afford the little luxuries in life. While being frugal is important, there comes a point where excessive frugality (some may call it “miserliness”) makes one unhappy and restless; accumulating money for money’s sake defeats the purpose of living a life, because ultimately we cannot take the money with us when we die, and therefore some of it must be used to enhance our quality of life. The key is in moderation – it is no point depriving yourself of simple pleasures like a good movie, a nice meal or a relaxing spa session just to save a few extra dollars. As long as you have budgeted properly, loosen the purse strings and spend on the little things, while keeping the big picture (wealth accumulation) in mind.

Splurging and Flaunting Wealth

There are others who take money to extremes, and display ostentatious spending behaviour in order to portray a certain image of themselves to others. To them, money is meant for showing off and they therefore splurge on expensive designer and branded goods and “bling” (the term for material possessions which are more of Wants than Needs). As a result, money to them is simply used for flaunting and acts as an ego booster, rather than as a source of security.

People who splurge needlessly and flaunt their wealth in visible ways (designer goods, fancy cars) do not appreciate the value of money. Money should act as security and be a testament to the hard work which one puts in – spending without regard is like throwing caution to the wind and engaging in extremely risky activity without a suitable safety net (likened to bungee jumping without a safety cord). In Chinese lingo, it is the classic case of punching your face till it swells so that you resemble a fat (prosperous) person.

Freedom from Worry

I guess for me personally, having enough wealth would cause me to be free from worry, and it represents a freedom in itself. In Singapore, most people worry about money because they may be enslaved by their mortgages or car loans; but if one is debt free and better still, financially free, one can enjoy a freedom which many others have yet to taste. Charlie Munger once mentioned that he wanted to become rich not because he wanted wealth to flaunt – it was because he desired the independence which financial freedom brings; and that was something he desperately craved. I share his sentiments on this – money to me represents freedom and being lifted from the bondage which debt brings. Right now even with five years left on my HDB mortgage loan, I still feel invisible chains dragging me down; perhaps I am too old-fashioned and conservative but to me debt is something which can choke the life out of someone, though others may encourage the careful use of leverage to multiply returns.

Helping the Needy

One altruistic aspect of being rich also means I will have more time and means to do charity. Money means being able to help people and to make a difference to their lives, and to me this is really the most profound thing which we can do – help another fellow human being. I had always harboured a secret desire to help those less fortunate than me – but sad to say I have been procrastinating when it comes to doing more for them. Though I do donate to donation tins and support fund-raising efforts for the poor and sick, I always feel that I could do more to ease the suffering of the less fortunate. So if you are reading this and you are an extremely wealthy individual, please spare a thought for those who are mired in less appealing circumstances and donate generously to help their cause.

Conclusion

I have listed out some aspects of money which I think relate to people around me. So the important question to readers is – what does money mean to you? Perhaps you can provide further insights or refute some of my points by using the comments box.