Myths About Wealth and Money
Self interest, well understood. Is comprehensive set of behaviors against vanity and consumerism. - Tocqueville
Modern consumerism has programmed many to strive for a life of safety and abundance. This note is about what one should not do to attain a life filled with health, wealth, and wisdom. These are commonly held beliefs rooted in bad advice that will keep many impoverished.
Myth 1. Wealth is Fixed
This idea views wealth as a zero-sum game, often portrayed in the form of a pie, if someone wins or makes a vast amount of wealth it is at the benefit of someone else that does not have the same opportunity because the wealth is no gone.
Proponents believe only certain individuals get slices while others are left with crumbs. But wealth is not a pie. Wealth is not fixed. Wealth is something that is created.
Think about the universe. Think about how expansive it is. Our minds fail to comprehend its size. There are infinite amounts of power sources. There are infinite amounts of resources. We live in a universe of abundance. We just haven’t figured out how to harness the potential. The same goes for wealth creation, it is not something easily grasped, but when it is understood, one can see myriad ways to make money in a modern day capitalistic society.
Myth 2. Money is Evil
"A few major opportunities, clearly recognizable as such, will usually come to one who continuously searches and waits, with a curious mind, loving diagnosis involving multiple variables. And then all that is required is a willingness to bet heavily when the odds are extremely favorable, using resources available as a result of prudence and patience in the past." - Charlie Munger
Work = exchanging time for money. Wealth = exchanging money for freedom.
Money is not the root of all evil. Money is a tool that can be leveraged for optionality, clarity, and freedom. Money can both create and destroy, it is all based on how you use it. Regardless of how you use it, it is an object. The person wielding gives meaning. Money often amplifies you, that is why it is important to have a clear mind when pursuing and leveraging money.
If you were a putrid person before you had money you will be an even an even worse person when you have money. Money does not change you, personal attributes will not change when one establishes wealth. Dominant attributes are simply magnified once one has more freedom and less fear of ruin.
Myth 3. Investing is Risky
Responsible investing comes with risk, but it is a risk well worth it. Some say the stock market is a casino. WRONG Investing is not like gambling at a casino. When you invest responsibility YOU become the house. The odds are in your favor.
You need to invest your money because cash is a depreciating asset. Money held in a bank is steadily losing to inflation. Money invested in the stock market will always outperform money in the bank. It's worth the risk.
Myth 4. Buying Cheaper = Better Opportunity
Often a low price or something perceived as a deal is not the best opportunity. The adage of you get what you paid for still holds true. In many cases, you must recognize that you will get a better return on your investment when you pay more.
Let me give you an example:
The cheapest foods are often highly processed, loaded with sugar, and can make one addicted to them.
Spend extra money on quality.
- Buy organic
- Buy grass-fed meats
- Buy fresh produce
- Buy foods that will give you a healthy body
Food becomes an investment. In the long-run, you will save money.
Myth 5. Hard work = Money
From a young age, children are told a great myth, “Hard work equals success.” This is a noble lie but it's not entirely true. Hard work is just the first step. It is the beginning of a journey that encompasses hard work, luck, and grit. Your goal is to get ahead and make your money work for you, that is the ultimate step. Make money while you sleep. Money does not need to rest so don’t let it.
Myth 6. Rich people are evil
"If you want to be happy set a goal that commands your thoughts, liberates your energy, and inspires your hopes." -Andrew Carnegie
This is believed by many people because they have not met or seen someone who is truly wealthy and has maintained balance throughout their life. Rich people are often portrayed as narcissistic, greedy, and deceptive. This is often not the case, this is more of the exception than the rule, the truth is that “good” wealthy person is not someone that can be marketed and attacked, they don’t drive clicks and incite others.
Common people want to believe this myth. It perpetuates the “Us vs Them” mentality.
It is easier to accept failure when you believe this. This myth is dangerous because it is a mental block that keeps many down and not willing to even try ascending the socio economic ladder.
7. Money will solve all your problems
Money will solve your financial problems but it won’t solve all of your personal problems. Money is simply a proxy that allows one to choose from a broader menu of options, it is freeing in that sense, but it does not ensure ones health or happiness. Issues that one has need to be solved intrinsically through self examination, reflection, and discipline.