Last year, I read an interesting little book called The Richest Man in Babylon. If you haven’t read it I recommend you get a copy.
What is Money?
The book is a collection of stories set in ancient Babylon (reputedly the wealthiest city of ancient times) written as financial advice and issued by some banks in the US during the Great Depression. It was meant to help teach the virtues of prudent financial planning, particularly saving and investing. One of its key lessons is that you should view your money like an army of little workers producing more money for you and your future.
Who Controls Money?
Do you see money like that or is it something that flows in and out of your hands? Does it seem to travel according to rules that are out of your control? Is it something that has to be captured and contained in a bank to stop it running away? If so, is a bank the best place to hold it?
What is the Point of a Bank?
These days, our banks want to give us access to money 24/7. Great! That’s so much more convenient than having to draw it out in advance. Convenience is good, right? But then, maybe if it wasn’t so easy to get hold of we might think twice before spending the last few notes in our wallets. It’s possible that convenience is not always the best option for us when it comes to money. Didn’t this whole recession occur because people (and banks) weren’t thinking twice or thrice before spending?
What do you think? What is the real point of money?
Money vs. Value
Before you answer, consider this too: when you buy something, are you after a particular product or service, or are you swapping one thing of lower value (you can get more cash, right?) for something of greater value to you? After all, if both items held the same value to you why not just keep the money & save all that bother?
The Next Step
What does this all mean? The fact of the matter is that the wealthiest among us don’t think about money the way that the rest of us do. Do we need to reassess what the point of money is, in order to be more financially successful? If so, what is the right way to look at it?