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Money Myths That Hold Us Back
Money is on everyone's mind. In today's uncertain, inflationary world, it is an ever greater source of anxiety and frustration.
How we think and feel about money is often a result of our upbringing and our early experiences. Our mindset around money determines our relationship with it in our adult lives.
Before we can unpack our beliefs around money, here are a few myths I would like to debunk.
Myth 1: MONEY IS SCARCE
There will be times when money is genuinely limited and every expense needs to be carefully considered. It is never a good idea to live beyond your means. However, there is plenty of money out there, and new wealth is being created every minute of every day, including by Central Banks whose job it is to ensure that there is enough money circulating through the economy.
Myth 2: MONEY IS THE ROOT OF ALL EVIL
Money is neither good nor evil. It is simply a tool for exchange of value. And like any other tool, it can be used to create something of value or to destroy. A hammer in the hands of a builder has a very different purpose to one wielded by a crazed maniac.
Myth 3: YOU HAVE TO WORK HARD TO MAKE MONEY
Working hard is a virtue, but it won’t necessarily bring you riches. If it were true, those manual labourers who work themselves into the ground would be millionaires. What matters is the value that is created as a result of the work. Generally, money is a measure of value, not effort. Work hard and work smart.
Myth 4: YOUR WORTH IS CONNECTED TO YOUR EARNINGS
Get to know your personal P&L account, Free Cash Flow and the Balance Sheet. You could be wealthy but cash poor. Or you could be earning millions and spending it all on things that have no lasting value.
Crucially, your self-worth has very little to do with your net worth.
So much of the value we bring to life can never be measured in terms of money. The intangible things such as joy, peace of mind, love and compassion are more precious because they are priceless.
Myth 5: TIME IS MONEY
This is one of the most common myths around money perpetuated by busy people. Service industries are built around billing customers on this basis. In reality, what we are buying is not time, but rather the expertise that in turn, hopefully, creates value for us.
Money can be earned, saved, replaced and substituted. Time on the other hand is a gift handed to every one of us at birth. A gift that starts to irreversibly ebb away from the instant we are granted it. At any given moment, we can never know how much of it we are left with. And yet we often take time for granted and waste it.
Everything changes the instant you see that money is abundant but your time is scarce, not the other way around. What money myth is holding you back?