Suze Orman Says This Is the Goal of Money — Have You Reached It?
Many people live paycheck to paycheck, some are barely covering their monthly expenses despite earning above minimum wage. When was the last time you felt you made enough money? It’s been a while, right? And this is not because you’re not earning money, but because you’re drowning in debt.
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According to financial expert Suze Orman, it’s because you’re yet to understand the goal of making money.
People have different goals of making money. An important goal for many is personal fulfillment because some people derive fulfillment from having more than just the basics of food, clothing and shelter.
Happiness is the purpose of life and money can buy happiness. Some people look at making money as a way to indulge in their fantasy of buying expensive things. Others look beyond themselves and want to do grand things like take care of orphans or donate to charities or animals.
Some love the simplicity of being able to experience life without thinking much, not thinking about affordability before making plans. Others have an aversion to poverty because of how they grew up.
All these are goals of making money, but if you’re looking to build a life of financial freedom, your goal of making money should cover something beyond these.
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Money is meant to be spent, it’s a tool for tackling daily, weekly, and monthly expenses but those are not the goals of earning money. Orman says the goal of money is for you to be secure.
According to her, “security comes from having an emergency savings account which is also essential for your financial freedom.”
Let’s say you’re able to save $1,000 every month after you’ve made expenses including loan payments. That’s about $12,000 a year in savings, and depending on the type of savings account you use, you can also earn some interest while the money compounds. This money offers you some security which can be more impactful depending on the amount you’ve saved and your lifestyle.
According to Orman, more financial cushion will make you feel more secure.
“Your expenses will go down because you won’t be spending as much,” she said.
In simpler terms, the more money you’re able to put aside in savings, the higher your security and that’s the goal of making money.
You should enjoy your money while you’re meeting your financial goals and creating an emergency fund, according to Orman. By creating a budget you can track your expenses, savings and enjoyment without suffering financial consequences that can derail your goals. Consider hobbies and activities that don’t cost money so you can stretch every single dollar and be able to splurge once in a while.
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