Money Is Just a Tool

I’ve been doing a lot of reading recently and I have been thinking about the concept of money and how different people look at it in different ways.  The main concept of these books is usually that rich people generally see money as a way to gain more assets that can in turn produce more cash flow, while the middle-class and people who struggle financially see it as a means to get what consumer items and lifestyle they want.

Is Money a Means To An End or The Goal Itself?

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The more I considered these notions the more I have come to agree with them.  I think the real important concept at the root of people’s relationship with money is the comparison between seeing money as a tool and seeing it as your salvation.  People who think earning a little more money will make them happier because then they can afford a slightly bigger car, or 100 square feet more of house, will likely never be rich, and will also likely always complain about their current economic condition.  People who view money as a tool that enables them to build their own independent streams of income have a much different relationship with it. Of course there is the third type of person who loves to work, and whose wage allows them to live exactly the type of lifestyle they want.  These type of people are usually very happy, and my only concern for them would be that they are not financially independent if their company fired them, or their wages got slashed, but by and large, these type of individuals will be fine.

Money Is Just a Tool – Financial Independence 

I personally love my job of teaching, but I am fairly certain that I am not meant to spend more than about 10 years in the classroom.  I have begun work on a masters degree, but I am not even sure that I want to climb the administrative ladder.  I may, but getting the degree just gives me more career options and allows me to learn something new that will benefit me in any number of job environments.  I have also tried to find a number of streams of income outside my line of work that will allow me to become financially independent at an earlier age.

The term financially independent is an important one to consider when thinking about money as a tool.  Whether someone wants to retire early or not is irrelevant to the idea that you don’t need to depend on a single paycheque from a single source any longer.  When you have reached this point you can truly decide what you want to do with your time.  There are many different ways to get there.  Some people start there own side business and then sell it, or make enough profit off of it to hire someone else to do the day-to-day operations.  Others invest in income-producing properties (landlords).  Still other people advocate for investing in dividend-paying stocks such as Royal Bank or Wal-Mart that will pay you handsomely every quarter for being a part owner of the company.  The bottom line is that earning and spending a lot of money does not make you financially independent. The only way to ensure you are eventually financially independent is to create multiple streams of income for yourself and treat money as a tool to further your overall financial position.  If that means thinking like a “Rich Man” then I guess I do, but I just believe its thinking like someone who doesn’t look at money as some special goal in and of itself.