With the new-year just begun and the Meskel holiday behind us, we are going back to our daily lives. It is an expensive beginning of the year with school fees to be paid and the skyrocketed prices of about almost everything. Considering the continuous inflation over the past few years and the salaries that people earn, I imagine that money is the cause of a great deal of stress for breadwinners, who worry about how to make ends meet by the end of next month. This does not only affect the peace of mind, it must have a negative effect on the productivity of workers as well because they must get more money to pay the bills than they will actually receive with their monthly paycheque. How do they do it? “I’ll beg, steal or borrow.” is the title of a popular song some decades ago and was a suggested strategy for the singer to win the love of the girl he admired. It should not surprise us that these are strategies employed by anyone who faces financial stress. In the west, banks and stores help out by providing easy access to credit but this often leads to a spiral down the road of ever increasing debts as people take on more credit than they can handle. Here we would probably ask and borrow from a friend or relative but that doesn’t make it any easier. Whether borrowing from a bank or from another person, some day the loan needs to be paid back and now this even puts a personal relationship under strain. It should be no surprise then that many workers will be tempted to take advantage of their access to money and materials at their work place and use it for their own purpose, not to speak of taking advantage of their position. Enter the issue of corruption. Another strategy still would be to cut down on monthly and daily expenses but rather than leaving the car at home, many car owners would rather limit their insurance to third party only or delay the long overdue service even more. In the end however, the entire family budget will need to be reviewed and choices need to be made between the essentials and luxuries. This classification may become more blurred however as we move on. What to do?
It is sometimes said that we are busy buying things we don’t want with money we don’t have to impress people we don’t like. Money touches every aspect of life and when people don’t handle their finances well it causes huge problems. Consider the following three truths about money:
Money will not make you happy. Even though most people would agree that money won’t buy happiness, they sometimes act as if they think it is true. Why else would they make money such a high priority or compromise their values to get it? Some years ago I watched a movie in which a millionaire offered one million dollars to a couple if they agreed that he’d spend one night with the wife. The couple carefully considered the offer, imagined all they could do with that money, brushed aside their emotions and agreed. This decision and compromise of their values resulted in misery of course. With the money in their hands, their relationship broke down. Do we have to go far to observe similar behaviour in real life? It just shows that some people believe indeed that money will bring them happiness. Not so. Divorce rates and depression are even higher amongst those who are better paid and can afford all sorts of luxuries. The Roman philosopher Seneca said nearly two thousand years ago: “Money has yet to make anyone rich.” And the carmaker Henry Ford concluded that “Money doesn’t change men, it merely unmasks them. If a man is naturally selfish or arrogant or greedy, the money brings it out, that’s all.” You are what you are, no matter how much or little money you have.
Debt will make you unhappy. Having money may not make people happy but owing money is sure to make them miserable. Novelist Samuel Butler, who satirized Victorian life in England, wrote: “All progress is based upon a universal innate desire on the part of every living organism to live beyond its income.” Yet, the truth is that if your outgo exceeds your income, then your upkeep will be your downfall. In the old testament, King Solomon summed up the condition of anyone in debt when he said in Proverbs 22:7: “The rich rules over the poor and the borrower becomes the lender’s slave.” Who wants to be a slave, controlled by someone else?
Having a financial margin gives you options. The bottom line is that money is nothing but a tool. It is good for helping us to achieve goals, but the goal of getting money for its own sake is ultimately hollow. If you have little money, you have fewer options and you may not be able to live near the school of your kids, drive the car you want, build your dream house, etc. It is therefore important to know what your financial margins are and to decide on the priorities you can afford within them.
Now that we have uncovered some truths about money, next week we will see what we can do practically to earn and manage our finances daily.
Source: “Today Matters” by John C. Maxwell