Two Insightful Money Observations

Money is merely a tool, which means that money itself is not THE culprit. If stays where we leave it, it goes where we move it to. With that as a backdrop, let’s look at two scenarios:

  • More earnings mean more wealth       Y             N

Not necessarily as money is easily spent. Data from the U.S. Bureau of Economic Analysis reports that the personal savings rate is at about 3.20% of income with lesser income earners saving more than higher income earners. The data continued to show that we exhibit one of the lowest savings rates of developed countries; only Spain, China, and Australia save less than we do, currently.

  • Money Can Buy Happiness                     Y             N            

Yes, up to a point. Think of what that Powerball lottery could do for you! Science has researched this question and found that how we spend money has an influence on our happiness. Research shows that happiness is increased when we spend money on others more than on ourselves. Does this have to do with experiencing satisfaction? I don’t know, I am merely asking. One study, I remember reading from the Weatherhead School of Management at Case Western University, indicated that once people earn more than $200,000, their level of happiness did not increase significantly.

 Money is very personal. Being personal, it is important that you understand what money means to you, so it can be the sharpest tool in your tool chest, doing what you want it to do for you!

 

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