Rich or poor, it’s good to have money.
Sid Lance


Here are two anecdotes:

  •  Mr. A graduates as an engineer and joins a company as an apprentice. As a diligent worker, he is absorbed in the company and makes a place for himself. He consults his tax advisor and saves money regularly to reduce tax liability. After a few years, he buys a house and gets married to a working girl. His wife works on a clerical post in a bank. Mr. A makes a job change at around 40. By the time he is 60, he has gradually built a formidable savings base, children (2) are well educated (in India) and working on their way to be settled in life. At around 50, he gets a mild heart ailment, but manages to pull on without any recurrence. Today, he is looking forward to a happy retired life with his wife enjoying all the financial independence he wanted in old age that includes a trip to Far East. He also plays chess well and is happy to spend more time for his hobby with other chess lovers.
  • Mr. B, a friend of Mr. A also graduates as an engineer and joins a (different) company as an apprentice. As a diligent worker, he is absorbed in the company and makes a place for himself. He consults his tax advisor and saves money regularly to reduce tax liability. After a few years, he buys a house and gets married. But here the similarity ends.
    Mr. B marries a MBA girl working in a MNC. Also, Mr. B changed jobs thrice each job landing him higher payments and responsibilities. Coupled with the earnings of his wife, by the time he is 55, he had built a huge savings base (around 3 times of Mr. A), his only son was sent to study abroad and is settled there. At 55, Mr. B loses his wife to cancer. Today, Mr. B continues to work for his employer as a consultant (unlike Mr. A who is retired), lives alone with no social life and has no hobbies.
    What is not said above that “Mr. A had been offered one of the high-stress jobs that Mr. B took that had declined the offer!

We keep on hearing about ‘work-life balance, but what about ‘money-life’ balance? The above anecdotes are not representative, but symbolic of people who make choices relating to money that affect work life balance.

One should not be judgemental in money matters. If somebody enjoys being a work alcoholic and earns lots of money, why should anyone have reason to object? Yes, the objection would be to the example set out by such work slaves to other peers at workplace. Having a super-performer boss is never easy for his/her subordinates in office.
Should money-life balance be treated as a subset of work-life balance? This could be the case since choice of type and intensity of work is largely dictated by money expectations. When a person treats the means (money) as an end in itself, everything else (health, family, social life) is sidelined leading to tragic consequences in some cases.

Even our wise ancestors had realised the value of leading a balanced life. The four Purusharthas {objectives} of Hinduism are – Dharma {righteousness}, Artha {money & wealth} , Kaam {sex and desire} and Moksha {salvation}.

Finally, here is a chilling finding:

People who regularly put in overtime and work 10 or 11-hour days increase their heart disease risk by nearly two-thirds, research suggests.

So let’s not forget that money is for life and not vice-versa!!

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When it is a question of money, everybody is of the same religion.
– Voltaire


Heard of these worthy quotes?

-’Money cannot buy happiness’

-‘Money can buy a bed, but not sleep’

-‘Love for money is the root of all evils’

Quotes such as these smack of a negative attitude towards money. There is no dearth of stories that paint money and wealth as a villain. Remember the story of a rich man (who does no work) spending sleepless nights on a cozy bed as compared to a poor man (a labourer) having a sound sleep on a hard ground?

To an impressionable mind, they could fill his mind with a loathe for money. Loathe that would put such a person on a dangerous path of self-harm in money matters.

If money were really such as bad thing, why would almost everybody long to have it? Why would money become the barometer of smartness and social status?

Negativisms abound in every sphere of human life, so money is no exception. But given the all-pervading impact of money, negativism could be nothing short of a catastrophe. So how does negativism of money affect our lives?

Firstly, the person nursing a negative attitude towards money develops a martyr’s mindset- suffering hardships to prove his point that money is worthless to him. Thus he turns himself into a self-righteous warrior against all things ‘stained’ by money. 

Second, the person denies himself a rightful chance to migrate to a higher station in life. A careful look around would show how some people turn away opportunities to earn a decent amount of money to live a life of penury.

Third, depending on individual circumstances, disdain for money also brings misery to the family members of such a person. Wealth collected over generations in a family could be lost by one such member.

So how does one make out such an individual?   

Two tell-tale signs are- one, opting for a lesser remunerative occupation over another higher one [this may be justifiable in cases of social service like a doctor opting to go to a village over a paying job in a city] and second, squandering money resulting in no savings worth the name.

So, whether reducing income or increasing spending, the effect is the same- lesser money in the kitty and practically no wealth to speak of.

What could be cause of this negativism? It is the tendency to complicate matters by relating money with values such as hard work, social justice, etc that encourages hatred for money. When a person begins to hate money, he generalizes that money is inherently bad and glorifies poverty. He fails to see money as a means to an end that needs to be judiciously managed. 

Some facts that need to be kept in mind are:

Ø  Most people around us earn money the hard way, barring criminals/scamsters, lottery winners and people who inherit pots of money and wealth. The rising middle class of India is the result of toil over the past 50 years. As more and more people migrated to cities in India and worked hard, they purchased houses in cities, built up a savings base and showed that there are ethical ways of earning sizeable amounts of money. Today our middle class exceeds the population of many countries of the world.

Ø   If money causes social injustices, the cause is in human tendency to exploit and not money itself. For example, farmers whose land is acquired for projects may not be given compensation that is adequate for loss of source of livelihood and other cultural and emotional factors attached to land.    

The last word is that no person can generate wealth if he has a negative attitude towards money. A money-life balance is called for, of which we shall talk in the next article.

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Money Management

When money speaks, the truth keeps silent.
– Russian Proverb

MONEY – The one word around which our lives revolve. Barring a few years of childhood, money remains the focus of our lives. As a child of 2/3 years, money means nothing to us. A currency note is just another chit of paper. But as the child grows, he or she begins to understand basic facts about the economic class in which he is born. By the age of 13/14, the child is quite aware how money affects life. Since that age money occupies a major part of his thoughts till the end of his days.

What is it that makes money so special?

Money could be simply defined as “Money is a token or item which acts as a medium of exchange that has both legal and social acceptance with regards to making payment for buying commodities or receiving services, as well as repayment of loans”.

Part of the answer lies in the fact that money is the common denominator of all material things in the world. So things as diverse as a car and a chocolate are both expressed in the same medium of money. It is this simple feature that lends power to money that is both awesome and terrifying.

The other part of the answer lies in the importance a person gives to money. Those who see money as a means of getting all happiness put themselves in an endless race to gather more and more money. In the legendary film ‘Deewar”, Amithabh Bacchan tells his brother, Shashi Kapoor that he has everything that money can buy, to which Shashi Kapoor retorts – “Mere pass maa hai!” The very fact that money and mother were juxtaposed in this dialogue should be enough to show it’s significance in our lives.

On the other hand, those who show contempt for money put themselves in hardships. Tales are floating around us of people who after a life of earning and spending money, find themselves penniless in old age. A recent report in newspapers is about the editor of “Sholay” and many other hits of his times, who is now around 80 and forced to live in poverty in a Mumbai slum after the old building where he lived in a rented house collapsed.

Since it is obvious that money means much more than a mere “medium of exchange”, it is necessary for us to understand that money management is important for an individual to ensure a steady and desired income, manage costs of living and a source of income even after we cease to work for money.

Money management has two aspects, inflow and outflow. The result is either savings [when inflow exceeds outflow] or borrowings[when outflow exceeds inflow]. Evidently, an individual has more control over costs than income. A change in income level shall need a fundamental change such as change of job or business line.

In contrast to income management, control over costs appears deceptively simple. One might say that why is it so difficult to limit or eliminate a particular expense that looks high and is dispensable? The answer lies in the fact that costs management assumes psychological and social aspects that makes it very difficult to implement. A person may continue to use a car long after he affords it because of a longing and fear of loss of social status if he junks his car owing to a drop in his income level.

So, money management needs that we look at things in an objective and detached manner. Once we manage this basic thing, money management becomes less tedious and complex.

More of that in the next article.

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