If money is an emotional subject for you, like it was for me, or if you think that money is bad, then I hope today’s post will help you to rethink things and change those feelings.
I’m the type of person who likes to understand things and now that I’m a financial educator, there were a few things that I felt I needed to understand better.
One of those things was money.
We spend a lot of time trying to earn it, save it, learn about it, but rarely talk about what money is – so, here goes:
Money is a tool for exchanging and storing value.
Let’s look at it this way, before there was money, people had to directly trade with each other. So, if I had a cow that I wanted to trade for chickens and other things, I had to go around looking for someone who had what I wanted and who wanted to trade with me. Plus, our trades had to be fairly equal because, well, there wasn’t an easy way to give back the difference (the change).
And if it was a rough journey and my cow died while I was looking to trade then the value would be gone.
With money, we bypass those obstacles – we trade for items of perceived equal value and in between, money stores the value.
Now, let’s take it a step further and dive into the question of how do we earn more money?
Well, remember that money is a tool for exchanging value. So, to earn more we need to increase the value that we deliver (this is not the same as our inherent value).
One of the best ways to deliver greater value is to look around for problems to solve. If you work for someone else, realize that your employer wants to earn a profit and if you can bring in money, or save money, then you increase the value that you deliver to the marketplace.
Another way of increasing your value is to consider what comes easily to you that has value for others. This seems simple but often the tricky part is that we dismiss these things that come easy to us because we think that they come easy to others and therefore these things are of no value. But just because these things are easy for us, doesn’t mean they’re easy for others – so, stay alert for ways to bring value and don’t be too quick to dismiss things that are easy for you..
One of my favorite authors is T. Harv Eker and he speaks about how to know how valuable your value is. Eker suggests the following 4 as methods to increase the value that you deliver:
Quality: How good is what you deliver?
Quantity: How much of it do you deliver?
Demand: How much do others want the value that you provide?
Supply: How much of it is already out there in the marketplace? This is where it benefits you to differentiate yourself so that you’re different from others who otherwise would be your competition.
Does this definition help you to make money a less emotional subject? Does this perspective help you to know how to improve your financial outlook?