Finance 101 ‒ It’s All About Money?
- Dec 28, 2022
- 6 min read
Written by: Ketan Kulkarni
Money is here to stay! It’s among the most talked about topics in the world! It’s something you simply can’t avoid unless you live completely off the grid! It just means that money is a necessity in this world. It’s the key to living life on your own terms in the 21st century and simply cannot be neglected.
But when asked about money many people either (i) avoid the topic (ii) think about what they don’t have (iii) think about how they can may be strive to make more (iv) hate their current financial situation or (v) simply discuss how they can’t have what they want! Some other people simply show their resentment towards money or even despise money as root cause of all evil. Many despise their work. People even vividly describe how their bosses, or supervisors are so unfair and nasty. Many go another step further and suggest that many rich and famous used unfair means to make money and despise them!
This article is not about how to invest. There is a lot of brilliant literature on that. What if you truly mastered money and your finances? What would that look like. What if you truly understand what money means to you? This article is precisely about that.
Before we explore mastering money let’s consider a couple of examples
CD is a 49-year-old corporate tax lawyer who lives in 4 million $ lake front mansion, drives a Ferrari, has a net worth of more than 10 million, goes to 4 to 5 exotic vacations per year, collects watches and works 5 to 6 days in his typical week
In contrast, AB is a 49-year-old retired gamer who now works as a freelance coding consultant, lives in a 600K house, has a net worth of $1 million, works at his will, has a travel bug, plans on launching a startup in the near future.
It would be very natural for many or most people to prefer CD over AB and consider CD a resounding success in the 21st century. After all he can afford all the modern toys and gizmos.
But let’s consider some more information.
CD has anger management issues, feels superior to many of his colleagues and counterparts, often feels disconnected from his friends and family, focuses mainly on $ the value of his work and things, and appears overconfident. She does notice that somewhere something is missing.
In contrast, person AB has a stable family, lots of friends, lots of free time, coaches the next generation, volunteers a lot of time for veterans, and looks at life as an adventure. He is excited about what he can do in the next few decades of the gift of life.
Suddenly our perception of financial success changes. We no longer consider CD a resounding success and many would prefer AB over CD.
Most certainly if CD had the emotional stability, joy, fulfilment, and satisfaction that AB experiences it would be a different story. He could indeed be considered at the epitome of success.
In contrast CJ is a young doctor who is seriously considering evaluating their financial goals, their understanding about money and truly wants to master money, especially after recognizing the comparison and contrast of AB and CD. CJ considers the following enduring questions.
I need to make money but is money the end goal?
Money is indeed a mean goal and not an end goal in itself. The ultimate goal of money is not just to acquire it. The aim should be to acquire money so you can achieve your end goals, whatever they may be. Data is abundantly clear that the sole pursuit of money almost certainly ends in misery. Many seemingly successful people lose themselves in the unending pursuit of more wealth, believing they are becoming more successful as they accrue more. They succumb to the classic “if-then” hypothesis thinking that they will be happy when they acquire certain assets or things or get somewhere in their lives. Truly speaking they are after the feeling they will experience when they get to their goal post. And then the goal post simply moves further!
Instead, CJ recognizes the importance of understanding their why clearly in the context of money.
Understanding your why
Understanding why you want money is critical. What kind of lifestyle do you truly desire, what kind of relationships and experiences do you want to pursue? What about your health goals, growth goals and spiritual goals? What about your contributions?
Your accumulation of wealth needs to support your why, whatever that why is! This will open the floodgates of fulfilment. CJ plans on precisely mapping their why and then pursuing the accumulation of money as a means to support the why.
Emotional not rational
CJ still remembers buying their first SUV and then regretting it. It costs them almost 1100$ per month in payments, not to mention the cost of insurance and maintenance. CJ always thought that driving a nice-looking SUV would make them appear very successful, so they prioritized this over their student loan re-payments, investments and even first home buying. And the SUV is a depreciating asset. CJ doesn’t want to repeat this mistake in the future and have appropriate priories for spending.
Data is clear that a lot of our money decisions are emotional and then rationalized. This is contrary to the popular perception that human beings can be very rational and logical. Spending habits are often strongly driven by underlying emotions. Thus, recognizing and understanding one’s emotions around money is critical to develop good spending and saving habits.
Social comparison
Someone always has more, and someone always has less, CJ contemplates. Compare yourself to who you were yesterday. This is such a powerful insight! Yet, especially in the era of social media, this is something that virtually all of us fail to do, at least some of the time. The race isn’t with other people. Their goals may be completely different that yours! One needs to inculcate a culture of appreciation and acceptance rather than comparison.
Capitalism and money
CJ understands that money is a means to an end. Even if one had lots of money but no freedom (which would be a personal choice), extremely strong evidence suggests one will not be happy. Conversely, if you have relatively little money but loads of freedom, it is far more likely that you will be fulfilled. Yet a person’s relationship with wealth, material goods, possessions, status symbols, and other signifiers of money tends to be completely irrational. Much of this attitude can be attributed to modern marketing.
In order to be happy, in order to be the best version of ourselves, in order to pursue our authentic goals and selves, CJ must sever the ties that bind us to an advertiser’s image of what happiness should look like.
Relationship with money
Everyone has a relationship with money in some form. They have deep seated thoughts, emotions, attitudes, and beliefs towards money. Most people, however, are not aware of their thoughts and emotions about money. And even less have evaluated their relationship with money. Furthermore, many tend to have a distorted relationship with money. This relationship is based on a range of factors including lived experience, family traditions, culture, peer experience, socio-political factors among others. The good news is that one can heal their relationship with money and develop a positive, healthy one. It requires investment in developing the appropriate money mindset, like CJ contemplates doing.
Money mindset
Getting to the core of one’s positive and negative thoughts and emotions about money is critical. Simply recognizing and evaluating your thoughts about money, wealth, and successful people can be a useful exercise. Ultimately, one needs to invest inner-work through these obstacles to clear the way for success. Understanding how one’s family, peer, lived experience, geography and such other external factors influence one’s views around money can be enlightening. Inculcating an abundance and growth mindset towards money can be a pivotal shift. Expressing gratitude for the money one has, the money one spends and the money one wishes to make is a wonderful start. CJ plans on starting to unravel their mindset.
Thus, akin to CJ, everyone needs to understand and assess their Finance blueprint. Understanding and developing one’s money blueprint is key. Wealth is not just a number: it’s a feeling as well! This often requires Finance coaching. Developing a clear financial plan with healthy spending and saving habits, budgeting, living within one's means or creating the means to support one’s desired lifestyle is the key.
It's not about money at all. It’s all about your relationship with money and your money blueprint!
For more information you can visit www.thelegendaryquest.pro. You can subscribe to receive a free life satisfaction questionnaire.
About the author Ketan Kulkarni:
Ketan Kulkarni is an international award winning physician, entrepreneur, a clinician researcher (>125 published papers), a SELF (Success, Entrepreneurship, Leadership, and Finance) coach, author, an avid learner and networker, a traveler, an art enthusiast and antique collector and a music buff.
The Legendary Quest:
https://www.amazon.com/Legendary-Quest-Professionals-Excellence-Fulfillment/dp/B09TWPHFFR/ref=sr_1_1?crid=25K7XCWQWPD6I&keywords=the+legendary+quest&qid=1669732777&sprefix=legendary+quest%2Caps%2C117&sr=8-1
