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This chapter is from the book

This chapter is from the book

Money Is a Tool

Money is a tool, just like technology. And just as many technology professionals focus entirely on the technology rather than its function within a business context, so we also focus on money as having value to buy things, rather than its functional role in our lives.

But money is simply something you trade for something of value. In addition, the money you receive has been similarly traded. You apply your effort and knowledge in return for the ability to trade for various products and services.

If you are honest, you hope that you provide value and that your employer or client recognizes and rewards that value. You are similarly aggravated or upset when your work is undervalued.

Yet, when you spend foolishly, you are, in a real sense, devaluing your time and effort. It does little good to create a strong sense of value for your time and effort only to turn around and sabotage that value through foolish spending or mismanaging your finances.

To illustrate this point, consider the following theoretical example.

If you are paid $40 an hour, you make somewhere around $80,000 per year (assuming full-time work). This is a fairly decent wage, and your time is being valued. Now assume that you spend five nights per week eating dinner out at better-than-average restaurants. Assume that your monthly total for dining out comes to $800 per month.

Although you might argue that you have had decent meals, you can prepare a decent meal at home for $7 to $11. If you went out to eat only one time per week and prepared meals the other nights, you would save $480. If you are paid $40 an hour, that equates to 12 hours of your life.

I'm not making a value judgment regarding eating dinner out. What I'm trying to emphasize is how attitudes toward money and spending might be in conflict. If you want to have financial stability and yet place eating out and buying things as priorities—if not in words, in actual practice—you are in financial conflict.

I state this only as an idea of how people devalue their labor and the money it produces through ill-advised spending habits. If your career is where you want it to be, you are flush with cash, and you easily meet all your financial obligations, go out to eat. I am addressing those, the majority, who are in far different circumstances.

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