Money is, by definition, a tool to expedite trade. At some point in human history, someone decided it was easier to carry metal coins to the market than bartering chickens for textiles. Money was born and agreed upon as an acceptable unit of trade.
By its nature, it retains no moral or immoral attributes. It only makes trading goods more convenient. If I have enough currency to provide for my basic needs, it should not be a source of pain or anxiety in life.
Unfortunately, this is not typically the case. According to a recent study, Nearly three out of four adults reported feeling stressed about money at least some of the time. Despite living in one of the wealthiest nations in the history of the world, money continues to be the top source of stress in American’s lives.
This juxtaposition is fascinating to me. And I think it is important to understand why that is the case.
At the outset, I should mention money is a complicated conversation. There are very few specific realities that can be blindly offered—especially to such a vast and varied community as this one.
We vary in many ways:
Financial Standing: Some of us live with excess, some of us in debt. Debt, by its nature, brings anxiety and worry into our lives. And overcoming stress completely can be difficult until we get out from under it.
Income: Some earn a living well above our needs, some specifically allocate each penny for budgets to align, and others fall further and further behind.
Socioeconomic Background: Some of us grew up with plenty, others with very little. These backgrounds reflect themselves consistently in our expectations. James Altucher once famously wrote that he felt poor with less than $10 million in the bank, while most of us would never dream of having that much. Our backgrounds greatly influence our expectations.
Cost of Living: Becoming Minimalist readers are scattered all across the globe with various costs of living. Some live in areas where the cost of living is high (New York City) while others live in places where money can buy much more.
World/Religious Views: Our views of the world and humanity greatly influence our understanding of money. Sometimes these views offer peace, sometimes they bring guilt and shame, while others pile additional stress and anxiety on our lives.
Committed Relationships: There is little shock when people first hear that money is one of the leading factors in divorce rates. When two people with differing personalities and backgrounds come together in the same family, there is almost always some friction. And friction in our most valued relationships naturally results in a level of anxiety.
Consequences from Decisions: Some financial decisions take years and years to overcome. One foolish shopping spree in our twenties may still haunt our credit score today. Even if we are responsible spenders today, we may still be feeling the ill-effects of less-wise choices from our younger self.
Because of these variations, specific thoughts about money are almost impossible and sweeping generalities must be personally evaluated before they can be applied.
But as I consider the evidence, I see two main reasons that almost 75% of us experience money-related stress: 1) We wish we had more; 2) We spend as if we already have more.
1. We wish we had more. There are any number of reasons why people want more money—sometimes those reasons are healthy, sometimes they are unhealthy. Certainly, the possession of money is not contrary to a simplified life, but a simplified life is not possible if money possesses you. Those who love money can never be satisfied. They will never own enough. They will always desire more. And those who desire to be rich carry the weight of that burden every day. It will always hold hostage your thoughts, your attitude, and your actions. It results in extra stress. When the love of money is present, freedom is not.
2. We spend as if we already have more. Another significant reason for money-related stress is the propensity of so many to live beyond their means—going into debt by spending more than they earn. Sometimes this is a result of poor management or unexpected emergency expenses, but most of the time it is a result of excessive consumerism.
There aren’t necessarily easy answers for overcoming the reasons above. But at the very least, demystifying and labeling the reasons for our financial anxiety moves us one step closer to overcoming them.
Jeffrey Pillow says
One way my family eased financial stress, and this is something you touched on a few months ago in your Target post, was a conscious decision not to shop at certain stores — Target being one of the main culprits.
We were spending, as you say, as if we actually had more. We didn’t. We were in the red.
It took some time to get my wife on board, but since doing so we’ve saved a small fortune.
The thing about stores like that is, they just want to get you in the door. Once you step foot in, they’ve won.
Sure, a lot of things are cheaper so why not go to Target? You’ll save money. The big lie they and we tell ourselves. Not so fast.
Stuff you didn’t know you wanted until you were there. That’s how they make their money and how you lose yours.
Could be anything really. So many choices.
That’s advice I would offer. What store is your weakness?
Now, don’t shop there.
Another good one: not allowing yourself to go down the middle aisles of the grocery store except for toilet paper and coffee.
Instant money saver.
Judy says
Like you said, Joshua…there aren’t any easy answers. Everyone’s situation is different.
Linda says
I am blessed to never have gotten in trouble with debt with never having more than a mortgage and one car payment. I can probably thank my parents who ingrained this in me. However, minimalism has pointed out the freedom and discovery that comes from truly considering what I need verses want, what brings joy verses a temporary fix.
Focusing on acquiring memories verses things has really given a perspective to purchases. I still falter and buy things for the wrong reasons but find I am returning many purchases as I grow in this mindset.
Minimalism has also brought a newness in my spiritual walk that is more pure. Getting the clutter out has helped me focus on the important.
Thank you Josh for allowing God to use you in this way.
rosie says
Very interesting. I’m about to start university, meaning it’s time to get to grips with money and it’s already proving very stressful.
http://www.rosieleizrowice.com
Kalie @ Pretend to Be Poor says
I agree that the love of money and desiring to be rich are a cause of financial stress. Many people may not realize that’s their desire, but the constant search to acquire more possessions, comfort, or savings/security can reveal a heart that loves money.
I’d add, on the point about most debt being due to excessive consumerism, that student debt is possibly an exception. However, I’ve seen many (and was among them at one point) pay the minimum while spending on materialism, rather than paying them off quickly by living simply.
Sandra says
Thanks for this post Joshua. I clicked because I do have stress when it comes to money like most people but you’ve provided some useful and insightful points here.
Luke (Dollarwise) says
Thanks for your thoughts Joshua.
The human heart is a strange beast. I noticed that you didn’t offer an answer to the abundant love of money and things in our cultures (I’m an Aussie).
By way of adding to the conversation, I think you need to begin to grasp the ways that money controls our hearts. The love of money is rooted in a love of what we think money can do for us at the level of our deepest desires. Namely, things like happiness, security or status. Deep down we believe money will give us these and hence we love it, chase after it or the things it can buy. It controls us by first controlling our hearts.
So if you can convince yourself of the lie that money gives you these things it goes a long way to severing it’s control over you and in turn the stress you feel. The next step is to replace the lie with something better. You can check out more of my thoughts on this on my blog, see ‘a philosophy of money and how it controls you’,
Thanks,
Luke.
Brian Robben says
There’s definitely an interesting dynamic going on between money and freedom. Enough money can certainly buy freedom, but you also can’t obsess over money or you’ll never gain that freedom even if you become a billionaire. It’s all about your mindset toward money in my opinion, and not becoming a slave to it.
Stephen @ Thoughtful Growth says
Hi Joshua, great analysis as always!
Thanks for pointing out so many factors leading to our perspective of money. Perhaps I’m just naive (probably so!), but hadn’t considered how relationships and religion affect how we see finances.
Reading your two reasons for money-related stress reminded me of a book I finished yesterday–Cheap by Ellen Ruppel Shell. The book talks about how discount culture encourages consumerism. Specifically, cheap versions of formerly expensive items make us believe we need them.
The continual focus on bargains and cheap merchandise hurt consumers in the name of helping them. Stuff is cheaper, which makes us want more of it.
Like you wrote years ago about owning higher quality things, it’s better to own something that will last, even if it’s more costly.
Thanks again for the article.
Catherine says
I can definitely relate to paying for the consequences of some REALLY bad decisions in my youth, however I have now been fortunate enough to clear all bar the mortgage and have discovered through taking a purchase pause I can be more generous than I thought was possible. I’m now considering what I’m ‘voting’ for when I make purchases: is it ethical? is it fairtrade? etc. This is obviously after I have worked out if I actually need to be making the purchase!