Is Money A Tool Or The End Goal

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What’s your perspective on money? Do you view it as a tool? Do you know how to use that tool? Is it like a hammer that you use to build a house, murder somebody, or that sits on the shelf and collects dust?

In this episode of the Finance for Physicians Podcast, Daniel Wrenne talks about using money as a tool and what happens when people don’t view money as a tool.

Topics Discussed:

  • Money Spectrum: Some people go to extremes, but most are in the middle
  • Temptation: What is more important—more money or more time with family?
  • Money is a tool that does not buy happiness but helps you attain happiness
  • 3 Ways to Recognize Money as a Tool:
    • A tool for what? What are you building?
    • Learn to use the tool. Are you using money to build your ideal life?
    • Maintain awareness about the outcome. Are you using money effectively?
  • Key Takeaway: Money should not be the end goal—you can’t take it with you


The billionaire who refused to pay kidnappers to save his grandson’s life

The Man Who Quit Money: An Interview with Daniel Suelo

The Young Physicians Complete Guide To Creating A Financial Plan

Financial Vitals Check Part 1: Clarify Values

3 Exercises To Help You Clarify Your Values

The Key Process Behind Using Money To Live Better Lives with Jennifer Quire

How Can You Become More Financially Competent

What’s Your Relationship With Money

Contact Finance for Physicians

Finance for Physicians

Full Episode Transcript:

What’s up guys? I hope you’re having a great day. I was talking with a client the other day and he was sharing what I thought was a really interesting perspective on money. He was talking about teaching his kids about money. He described money like a hammer. You can use a hammer to build a house. You can also use it to murder somebody, or you can just let it sit on the shelf and collect dust.

Most people don’t exactly view money like a tool, like a hammer, for instance. Maybe they don’t even know how to use the tool, like a hammer. If you see somebody swinging a hammer and they’ve never done it before, it’s pretty obvious that they don’t know how to use it. What he was sharing is that he wants to make sure that he’s teaching his children to view money more like a tool, and help them to learn how to use the tool.

I thought that was a fantastic concept to understand and remind ourselves of not only for our children, but really, it’s a good reminder for most adults. I thought today, we would talk about that a little bit, talk about using money as a tool, maybe go through what this might look like, and how you can make sure you’re continuing to move that direction.

Before we get into using money and viewing money as a tool, what happens when you don’t view money as a tool? I think that’s a good starting point to think about that. One thing that can happen is you start to, or at least the temptation is to start to view money as the end goal. It’s almost like you worship money. That’s the extreme, but it can easily become the most important thing in your life like your number one. It can drive everything you do.

Along those lines, one interesting story that comes to mind. I’m sure many of you have heard this story. They even made a movie about it. This is a true story. There was a rich oil tycoon and his grandson was kidnapped. I think he was a teenager, maybe like 16 years old or something. Probably because they knew his granddad had billions of dollars so the kidnappers ultimately wanted money to return their grandson. They went after the granddad.

I think they were asking a few million dollars or something along those lines. Basically, it was the amount that the grandfather could have easily paid to release his grandson. He refused to pay the kidnappers eventually. I think he made a deal with him and paid him, and this is after months. He made a deal with him and paid him. I think it was like the max tax deductible ransom which I didn’t even know was a tax deduction. But pay them a couple million dollars because it was the max tax deduction.

Then the agreed upon amount was a little higher than that so he considered that a loan to his grandson which made him or tried to make him pay back afterwards. He eventually paid them some money. The grandson came out of it or was released and had a super rough time afterward. I think he ended up overdosing on drugs and having a rough stretch in between them. That to me comes to mind is the classic example of the person that has become so money consumed that they’re not even willing to give up money to get their family member back.

It’s one thing to negotiate. I don’t want to dig too much into this and I wasn’t in that situation so I don’t know what was all going on. To me, there’s months and months of negotiation, and not budging pretty much at all. Taking that long tells me that guy had to have put a pretty high view on his money.

I think that if I was in that situation, I would give all my money. I think of my child, if somebody kidnapped my child, I just write a check and you can have all of it because having the people in my life that are most important have a much higher ranking than the balance in my accounts. That’s an extreme example.

Maybe you’re thinking, well, I’m good there. I’m not like the oil tycoon. I’m doing a good job using money as a tool. This is really more of a spectrum here. I think most people are probably somewhere in the middle. It’s not as easy as you might think on the surface to see. It’s one of these things that’s hard to self identify sometimes, to see where you are on the spectrum.

The other extreme would be, I found a story about a guy who basically quit using money completely. I’ll link to it in the show notes. It’s an insane story as far as how far the other direction can go. This guy lived without money for 15 years in the wilderness, like they lived off the land. He basically gave up money completely. He’s like, I don’t even want to use it at all. He advocates that we can get by completely fine. He  proved it, and even be happier without even having money at all in the equation.

That’s definitely, a bit too extreme or way too extreme, probably, as well. Like I said, it’s a spectrum and a lot of us are going to be somewhere in the middle there. Probably a better example for us, and I’ve felt this temptation is, maybe we’re deciding to work a little more, just a little bit more. We’re already fully committed. We have a family at home. We’re already pretty busy but we agree to a little bit more. Say yes to one more thing, just to make a little bit more money.

What is that saying? I know, everybody’s probably had that and felt that temptation, but what does it really say at the end of the day, especially if you have kids? It’s easier to think about it from their perspective, because they’re just innocent, and they just want to spend time with you. It’s easy to justify that, I’m working hard to support my family. That’s easy to justify.

At the end of the day, what are we teaching our kids? I think what that is teaching is or at minimum, I would think it would be safe to agree that it’s a slippery slope that we’re starting to teach them that money is important, or maybe even money is the most important thing. Like I said, it’s a slippery slope. I’ve been there. I’ll confess, it’s easy to do.

It’s a constant temptation out there. It’s the temptation to earn more, work more, that thing to have more. It’s easy to slip up on, but I think the key or the most important foundation is being aware of this. That’s mainly what I wanted to talk about today is just having a little bit better awareness. That’s always a great starting point. Then taking some proactive steps, because if we’re not, the world’s going to pull us in the other direction.

The world pretty much teaches us that saving money is good and spending money is bad. In other words, money is the end goal. But, is that really true? I mean, most people agree that saving money is good and spending less is generally good, but that would also mean that the people with more money are more successful. The takeaway from that is that I have to work really hard to get more money so I can become more successful and happier, but there’s a big part missing there in what the world teaches us.

The problem is money itself. It’s easy to see money as the end goal—more work makes more money equals a happy life. That’s so if we’re not careful, that’s the way the world is going to tend to pull us. There are all these temptations out there. The problem is the money itself is not going to bring you happiness. It’s everything else that’s important. In fact, the pursuit of the money pulls you away from everything else that’s far more important.

Money is not irrelevant. I mean, I don’t want to get that confused. It’s just a valuable tool to help you live out whatever else is most important. We have to keep those things in order and remind ourselves that money itself does not equal happiness. Money can be used as a tool for attaining happiness but that’s a very different thing.

I’m convinced that this is the root issue for a lot of the unhappiness in our world today. I think there’s a really important thing. There’s not enough attention put on this, like on teaching us to view money as a tool, and reminding us that money does not equal happiness, money itself does not equal happiness. That’s important to recognize, I think, seeing money as a tool. Beyond that, I think, the next question is what else can we do?

We’ll talk about three things that you can do beyond just recognizing money should be used as a tool. The first thing is asking yourself, a tool for what? What are you building? You need to know what the end goal is. You need to be clear on what’s most important. Otherwise, you’re going to be susceptible to getting knocked off track, and all the temptations that we just talked about. Having a clear idea of your values is key. We talked about that. I’ll link in the show notes.

We talked about exercises for clarifying your values, if you’re not clear on that, but being clear on what’s most important and what are you trying to build. Then what are those logical steps to get there? If you’re looking at the house analogy, what’s the floor plan? What’s the building plan for actually building the thing? In finance, it’s a financial plan. The financial plan is basically the process of putting all this together. We’ll link to another show we’ve done where we cover what a financial plan actually is.

At the end of the day, it’s building out those steps to use money as a tool to reach that ideal life that everybody’s going for. Then just look at how you are tracking in your plan. I think that’s a good first step is thinking about well, what’s a tool for? What are you building? Asking yourself those questions, making sure you’re clear on your values, having a written financial plan, and how are you going to track progress along the way.

The second big thing is learning to use the tool. You can’t just let it sit on the shelf and collect dust. But you also have to be careful, if you don’t know how to swing the hammer, that’s going to cause some damage. The question to think about is, are you using money, the tool, to help you build your ideal life out? Think of it like the hammer. Are you using the hammer effectively to build a house?

So, learning to use the tool. Well, what does that look like? Regularly referring to your financial plan, gaining financial competency, educating yourself, working on the skills and behaviors. We’ll link to some shows on that as well. There’s a lot of different ways to fine tune those skills. It’s not just about the knowledge and the skills. You have to focus on the behaviors as well, which is like the definition of competency.

Having a good relationship with money, we also cover that in another episode, I’ll link to that. Practicing money decisions that align with values so it’s a little easier to clarify your values, but when you get in your day to day, the problem is you revert to the norm. Practicing in your day to day decision making, practicing moves that align with your values, is a good way to begin to use that tool effectively.

As you make these values based decisions, no need to regret, you got to watch out for the guilt and regret. Because if you’re using it as a tool, say, you’re spending money on something you’ve planned for and saved up for, and you’re feeling this guilt about spending money, don’t do that. That’s a fantastic thing to do because you’re something you value. You’ve taken the right steps, and you’re basically using money as a tool to enjoy time away. Then just being efficient with money.

I mean, that’s just making efficient money decisions that helps you more effectively use the tool. At the end of the day, it’s about moving towards that ideal life, and feeling confident and on track, and well balanced along the way. When you’re using the tool effectively, that’s how it’s going to feel.

The third big thing is maintaining awareness. Over time, there are all these pulls and temptations along the way. If you’re not intentional about this, you’re going to get pulled the wrong direction. This is not something you can set and forget. It’s like a lifelong thing. Even sometimes, as you start to see success, there’s an added temptation. As you build wealth, for example, as you have more money, there’s this additional temptation, it’s building wealth in itself can become alluring.

Every once in a while, it’s good to just remind yourself, am I using money effectively as a tool to live out my values, avoiding the temptation to think about having money, or spending money as good or bad? It’s more about the outcome. I think it’s the important thing. If you’re saving and investing, you’re not actually saving forever, you’re just saving to use the money later.

At the end of the day, I think the one big takeaway or a thought I’ll leave you with, I think it’s helpful to remind ourselves every once in a while, you can’t take it with you. I think I’ve talked to older people that have some regrets, or have some wisdom to share. They’re typically not like I wish I had more money. A lot of times, it’s like I wish I had spent more time with my family because at the end of the day, when you’re in your final moments, that doesn’t matter. It’s irrelevant, because it’s gone.

You can’t take it with you. Money should not be the end goal. Otherwise, you’re going to have a letdown at some point. The end goal should be really leaning into what you are going to use this tool for? Focusing on what that looks like because that’s much more exciting, more rewarding, and less regrets, that sort of thing.

Okay, so make sure you’re using that hammer effectively. Remember to use money like a tool. Don’t beat yourself up too much on this like this is a lifelong thing. Like I said, I feel the pull, I’m guilty of making some poor decisions along the way. But I think the bigger thing is doing your best to move the direction of what we’re talking about today.

As always, I enjoy chatting with you. I hope it’s been helpful and we’ll talk to you next time.