The conventional wisdom passed down through the ages says that we should save money to become rich. Most financial advisors suggest that we must spend less money than we make, and investing the difference will make us enough money to retire. The average working person spends their whole life in an office or factory, tries to save a little bit of money each month for 40 years, and then hopes to retire. That’s the common sense and simple way to get rich. However, it’s totally wrong.
I have a friend who’s in his 40’s now, and has been working since he graduated from a well respected college. He works hard, six days a week from 10 in the morning till 10 at night. He takes the subway every day, and is well-liked by his colleagues. He saves several hundred dollars a month. There’s only one problem: if he continues going down the same road, he’ll have to work until the day he dies. His savings of $20,000 or $30,000 will not be enough to support him. It’s a sad story, and very common.
How would you feel if you wasted your whole life working for someone else, only to discover at the end that you didn’t have enough money to retire? Wouldn’t that be a wasted life? How would it feel to know that you’ve spent your whole life working and saving, and have nothing significant to show for it?
In my friend’s case, he is poor in more ways than one. He has almost no money, and in addition he has almost no free time. He doesn’t have a wife or children, but if he did he wouldn’t have much time for them. As it stands now, he doesn’t have enough time to spend with his girlfriend or his friends.
Reason #1: Being Rich or Poor has Little to do with Money.
Being rich is not just about having a lot of money. Being rich is about having the resources to do what is important to you each day. Being rich is about having the time and energy to spend with your family. Being rich is about having friends, relationships and things of value in our lives, and not just money. Don’t you think that a life empty of love, relationships and happiness is poor, no matter how much money is in it?
I recently read a story about a top executive at Sony Corporation, who was making $900,000 per year. He works all the time, has terrible relationships in his life, and wastes most of his income on stuff that did not make him happy. He lost the remainder of his sizable income in bad investments. Do you think he’s rich?
Being rich or poor is not about the amount of money we have. You are rich when you have the time, energy, and enough money to do what you really enjoy. You are rich when you spend time with family and friends that you love. People who are poor are severely lacking in one or more of these areas.
The problem with saving money is that it does not give us the resources to do what we enjoy. Saving a few dollars will increase the money in our wallet by a few dollars. However, it will not free us from working in a job that we hate. A few dollars is not enough to help someone less fortunate in a significant way. A few dollars is not enough to help a good cause for society.
Go to 7 Reasons Why Saving Money Makes You Poor: Reason #2