What is Money?

by Jason S. ValaVanis, CFP

It seems, at least from my point of view, there exist only three categories of Americans who each hold different perspectives on “money”. Yes, my friend, only three. In over 23 years of maneuvering money for the benefit of my clients, it appears peculiar that most people have not successfully acquired a real understanding of what money actually represents. Here today, we’ll discuss this idea.

Since the beginning of tangible booty, about 2500 years ago, mankind has relied on some form of coinage. The original minting of this shiny stuff began around the 6th century B.C. in Babylon. Of course, we had bartered ever since the Stone Age, where one grunt would trade a fresh kill for a bundle of fruit from another grunt. Bartering is a form of legal tender even today, but it isn’t real money in the legal sense.

Historically, governments created their money, or currency, out of precious metals in order to stabilize its intrinsic value and hopefully stabilize their economy and appease the people. The “coin” was coincidentally backed by the full faith and credit of the issuing government, like it is today. In essence, a country’s currency is only as strong as its standing army, like present times. Over the decades, governments abandoned the use of gold and silver, since there’s just not enough to go around. Did this diminish its real value? Still, what is money? Is it fake? Is it really anything at all?

I’ve learned that approximately a third of America sees money as some variety of evil, hence this is why they like to get rid of it so quickly. They do not see it as a positive element. The moment it is earned, it is spent and it is departed. These folks seem to “live for the moment” and often seek immediate gratification. On the opposite side of the spectrum are the hoarders or compulsive savers. They see money as a Godsend and tend to bankroll it and savor its ownership. They dread the thought of losing their money and are horrified at the notion of having to re-earn it. They tend to under-spend and sometimes deprive themselves and their loved ones of needed goods and services, even though they can afford it. Oddly enough, these people rarely donate to charities. Neither of these two species really understand what money truly represents, do they?

What actually is money, you ask? Well, you’ll hear it here first: Money is humanity’s most profound creation! Without it you’d still be living in a mud hut with a thatched roof. Money touches every second of every day for all of us. For our money, strangers grow our food and strangers build our houses and roads. For our money, more strangers weave our clothes and transport us to our destinations. All this for some ugly paper? Unbelievable, isn’t it? Money removes the many degrees of separation that bartering imposed upon us for dozens of centuries.

The Neanderthals of society will scoff at our money problems and proclaim that money is the root of all evil. Not true, I say! In my meek opinion, money is the root of all industry, production, economies, health, nutrition, housing, transportation, and education. Without this fiat currency, we would transgress back into the caves whence we came. Enabling a man to trade his blood, sweat, and tears for a common currency, thus allowing him to survive and prosper, is nothing short of amazing.

Who is this third creature among us? The last and most ‘wanted’ element of society is the one who understands money and who fully grasps the idea that money represents sacrifice and labor. In order for one to acquire money, he or she was required to suffer a sacrifice; whether it be hours, months or years of hard work and diligence; whether it be away from family and loved ones; whether it be years of apprenticing to learn a skill or trade – it was EARNED. Then my friend, the worthy one is permitted by grace to trade that ugly paper for society’s elements of comfort; the clothes, the food, the wine and the abode. If this providential soul wants to ensure his or her future beyond the capabilities that age allows, then they use investments and savings to carry them even further into the sunset.

So, with this splinter of enlightenment, money is not evil nor should it ever be hoarded. It is necessary and forever ubiquitous. Treasure it with humility and the understanding that without it, the alternative is unacceptable.

Jason ValaVanis is a Board CERTIFIED FINANCIAL PLANNER® and the owner of ValaVanis Financial, in downtown Melbourne. Jason specializes in lifetime income planning for Retirees while protecting principal.
Jason can be reached at 321-956-7072.

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