Money Is Important: Here Are 15 Powerful Reasons

Rolled up cash representing why money is important

Why is money important?

We all know that money is important, but have you ever wondered why?

There’s no doubt that money affects many areas of our lives. On one hand, we can owe some of our greatest experiences to the money we had to pay for them. On the other hand, we can feel so much stress and anxiety over our financial situations.

If you’ve always struggled with your finances, you might see money as a scarce resource that keeps you from being happy. Or, you might see it as some elusive goal that you’ll never achieve.

On the flipside, you may be overly driven to make more money because you think it will solve all of your problems. You dream of all you’ll do when your bank account has a balance with 5 or 6 zeros and the happiness you’ll finally have.

I’m sure you would agree that the role of money plays an important part in how we all live. It has the capacity to open up amazing opportunities that can change the entire course of your life.

So, it’s important to have the right perspective about money and not merely dismiss it as something that only seems to create problems for you – or as the one thing that will make all your dreams come true.

When you have a healthy mindset about why money is important, you can understand its true value in your life and the possibilities it can provide.

You’ll realize that money itself is just a neutral, unlimited resource that’s available to anyone who is willing to control it. It doesn’t exist to make your life miserable and it certainly can’t buy your happiness (or can it? more on that later).

In this post, I’ll go over a few reasons why money is important, as well as how it can make some things easier, what problems it can create, and how much you really need.

Why do I need money?

This might be a silly question to think about (as you stare at your credit card bill), but it’s helpful to challenge your assumptions about money.

For most of us, money is absolutely a necessity. We need it for shelter, food, and clothing. Without these basics, your life would be in serious trouble. Money is the resource that allows you to attain a certain level of security and safety. To a certain degree, money helps you survive.

Now, that’s pretty important!

However, it can be easy to forget the significance of these basic necessities when you’re worried about how you’ll make your car payment this month. (When you feel your anxiety rising, focus on the fact that your money is allowing you to have a roof over your head and food on the table. Thanks, money!)

Beyond the basics, there are many benefits of money including freedom, comfort, and providing an unlimited number of opportunities to enhance your life. This is where many people get tripped up and start spending more money than they make. They see money as something that can buy them a little excitement or enjoyment now, instead of a means to build a financially secure future.

Money can do either, or both. It doesn’t care. It has no control over how you use it.

Money is simply a tool that can work for you or against you.

So, if you want to increase your financial literacy and maximize the benefits of money in your life, it’s critical that you learn how to use it properly.

When you learn better behaviors around money, its importance in your life will be evident in the freedom and choices available to you. Let’s talk about some of those.

15 reasons why money is important

When it comes to money, the more the better – right? After all, more cash means more stuff.

But, just having a nicer car or bigger home doesn’t give us deep fulfillment in life. So, why is money important, and why do we all want more of it?

Let’s go over 15 of the main reasons money is important.

1. Money is important because it gives you freedom and control

As an American, I am thankful for my freedom. I’m not restricted to what I can say, what I can believe, and whom I can worship.

However, as important as these things are, they don’t pay the bills. And, if I don’t have enough money, I am greatly restricted to where I can live, what I can eat, and how I can spend my time.

Without enough money, your freedoms are limited and you may even have to spend most of your time working just so you can cover the basic necessities. What little control you have may end up making you feel out of control.

Most people that don’t have enough money usually go into debt. Credit card bills and payday loans keep you from living in financial independence and hold you back from achieving your life’s dreams.

2. Money is important because it gives you options in life

Having access to money in the bank opens up more options for you. When you have enough money, you have more choices with the neighborhood you live in, the car you drive, the restaurants you eat at, and even the health care you choose.

Feeling stuck in your circumstances can be frustrating and discouraging. Money is important because it allows you the choice to change careers, move to another city, or buy a more reliable vehicle. 

3. Money allows you to pursue your passion

If you have to work two jobs just to pay the bills and cover your credit card debt, you won’t have the time or energy to go after your dreams.

It’s important to have money that gives you the breathing room to pursue your interests. You need to invest in yourself if you want a fulfilling life.

4. Money is important because it provides security

Financial stability comes with a lot of benefits, including a sense of security and peace of mind. When you have more than enough to pay your bills and stash some away, you don’t have to deal with financial worries about how you’ll survive.

You don’t need a lot of money to live securely, but you need enough to pay your bills and save an emergency fund to cover 3 to 6 months of living expenses.

Knowing a small emergency won’t turn into a crisis will give you the sense of security you need to make good financial decisions.

5. Money can provide valuable opportunities for your children

We all want the best for our kids, and money can help us provide a quality education to give them a good head start in life.

Private schools are expensive and usually out of reach for the family living paycheck to paycheck. This typically leaves the local public school as the only choice for hardworking parents who both have to work to get the bills paid. As a result, there is little choice or control over the quality of education and after-school programs their children have access to.

When you have the money, you can afford a better education, private lessons, tutors, and coaches. These additional opportunities give your kids the chance to pursue their interests at a young age and develop skills that give them an advantage in adulthood.

Of course, there can be a fine line between giving your kids an advantage in life and creating entitled little people. When you have the money to give them more choices, play a key role in their lives by teaching your kids about money and the value of hard work. 

6. Money helps you make more of it

The more money you can invest, they more you’ll have in the long run.

If you can find the money to buy real estate, invest in the stock market, and save in a tax-advantaged retirement account, then your money will grow.

Then, when you retire, you can benefit from passive income sources to support you through your golden years.

7. Money is important for giving back

Money is important because it allows us the opportunity to give back to the world we live in. Most people have a desire to be generous but have gotten stuck in a scarcity mindset because they’re always worried about money.

When you live on a tight budget, it’s easy to stay focused on making sure your own needs are being met. There’s little left to help others who are struggling more than you.

When you have financial freedom, you can be generous without being concerned about your own needs. You can get your focus off of yourself and give financial support to the people and causes you value.

8. Money gives you the chance to live life to the fullest

Living life to the fullest can mean different things to different people. Of course, you can have a very full and satisfying life without being rich. It all depends on what brings you fulfillment.

I love to travel, so a “full” life for me would include lots of vacations to foreign countries. This would require a lot of extra discretionary income. My husband, on the other hand, doesn’t really care about going overseas. He’d rather go on road trips or camp out by a lake, both of which don’t cost a lot of money.

Either way, money is the commodity that allows you to create the experiences that enrich your life in meaningful ways. Sometimes you have to have it to do the things that bring you joy.

From traveling to education to learning new skills, money provides the freedom to pursue your passions and live life to its fullest. Without it, your options become very limited.

9. Money can buy happiness … if you spend it right

Can money really buy happiness?

In past research, it’s been shown that money and happiness do, in fact, have a positive correlation. However, the relationship is weak and only leads to more questions. What if you have bad spending habits? Does it matter what you spend it on?

Research has shown that it does. Specifically, if you use your money on experiences versus possessions, and for helping others, then you can experience more life satisfaction.

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10. Money can provide a higher education

There are many careers that require a college degree. If you want to climb the ranks in the business, legal or medical fields, then you’ll need at least 4 years at a university.

The average in-state tuition for four years at a public university in 2021 was $43,000. For out-of-state residents, this cost was almost 2.5 times the amount.

College is expensive.

But, if it’s part of your big dream, you’ll need money to get there.

11. Money is important for your health

If you’ve ever had to pinch pennies to make the rent, then you know how finances can be stressful. A little stress now and then isn’t a bad thing, but it can really damage your physical and mental health if it becomes a way of life.

Financial stress often leads to depression and anxiety. Some get trapped in bitterness and a victim mentality. Many choose to give up any hope that they’ll ever get out of debt or find a better paying job. They’re so focused on just getting by that they never find any fulfillment in life.

Chronic stress can lead to physical health problems, such as risk of heart attack, insomnia, weight gain, and a weakened immune system.

It’s important to have stability in your finances so you can reduce stress and increase your quality of life.

12. Money is important for community needs

Organizations that serve the community through homeless shelters, food banks, welfare programs, and public health facilities, need money to run effectively. These funds are often raised through private donations and fundraising events. 

Without this money, there are many people in the world who would go hungry and not have the medical care they need.

13. Money is the difference between surviving and thriving

Some people spend their entire lives stuck in a paycheck-to-paycheck cycle. This leaves them without any room to get ahead because they can barely cover basic living expenses.

Having additional money gives you the ability to live below your means, put some in savings, get out of debt, and pursue your interests. It takes you from just surviving through life to thriving in life.

14. Money is important to make quality purchases

Have you ever settled for the cheap option because you didn’t have enough money for higher quality?

I did this a lot in my younger days. Cheap furniture, cheap clothing, cheap electronics. Just because I couldn’t afford to pay for better quality.

Inevitably, cheap purchases end up costing you in the long run. They don’t last as long, they’re unreliable, and you have to replace them sooner.

Money is important to make quality purchases that will last, so you’re not wasting money on the cheap stuff.

15. Money makes life easier

There once was a time when bartering was the only way to shop. If you wanted a new cow, then you needed to offer something of similar value to the seller.

Thankfully, money was created to make these transactions more fair and efficient. It’s the universal means to exchange goods, which makes life so much easier!

Money can solve problems – but not all of them

If you’re always pinching pennies, you may fall into the belief trap that more money would solve all of your problems. More money can definitely be a welcome rescue from financial emergencies, but there are many issues in life that can’t be fixed with cash.

Money can fix your car after it breaks down so you don’t lose your job. Money can pay for the medicine you need for your child’s asthma so they can play sports. Money can replace your broken fridge so you have a place to keep food for your family.

Money is important because it *can* solve many problems in life very quickly and easily.

But, money can’t fix anything that doesn’t require an economic exchange. This means you can’t use money to solve problems like:

  • Your broken relationship with your mother
  • How many true and deep friendships you have
  • The health of your marriage
  • Your insecurities
  • Earning respect from others
  • Having the courage to confront someone

Money is important because it can work as a tool to help you improve in these matters. But, you won’t find resolution in these areas until you work on your own character issues and personal growth. No amount of money in the world will give you a fulfilling marriage or genuine friendships.

Money can also create problems

If you don’t have a firm grasp on what you truly value, then money can quickly become a priority that negatively affects your life.

Let’s go over a few problems that money has the potential to create. Being aware of the negative aspects of money will help you keep your finances in perspective.

Giving money too *much* importance

The bible says where your treasure is, there your heart will be also. When you make money your treasure, it can become more important than people, health, integrity, and even God.

Some can mistakenly believe that money is the root of all evil because they misquote that famous verse in the bible that actually says “the love of money is the root of all evil.”

Money in and of itself has no ability to create evil in the world. It’s *how* we feel about money that can cause great damage.

Throughout history, the love of money has destroyed marriages, broken friendships, caused jealousy and rage, and even led to murder and suicide. Some are so driven to make more of it that they lose everything most important to them.

Although money is important for many things, we must remember that it’s only a tool to serve us. Once it becomes the master, we lose control and become enslaved to the consequences that result.

Money is often the cause of stress

I mentioned earlier that having money is important to reduce stress in your life. However, it’s possible that too much can end up creating stress for you.

If you grew up in a lower-income family, you may have developed an unhealthy mindset around money. The fear of living in poverty again can drive you to work too much or live like a cheapskate. This can keep you in a perpetual state of stress and anxiety around money.

Money is important, but having a healthy money mindset is critical to enjoying your wealth.

Money can create divisions in relationships

Unfortunately, money can really bring out the worst in people. Disagreements in financial matters are a common cause of divorce, lawsuits, and strained family relationships.

It may be as simple as different spending habits, or as complicated as the distribution of an inheritance. When it comes to financial conflicts, you must decide what’s more important – the relationship or the money.

If you and your spouse often have money fights, do what you can to find common ground. Have a financial goal that you can move toward together, but also give each other the space to express your individual money values.

So, how much money is enough?

Because we live in a world where we rely on money for food and shelter, we will always be in need of having some. But, how much is enough? And how do you make sure you don’t run out?

Putting a figure on what’s sufficient for you is a personal choice. If you’re satisfied with a simple life and you keep your financial obligations to a minimum, you could live on relatively little. But, if you have your heart set on a vacation cabin in the mountains, paying for your kids’ college education, and retiring a millionaire, then you’ll obviously need more.

Setting financial long-term and short-term goals is a smart habit that will tell you how much money you’ll need for the things you want. When you’re intentional with financial planning, you have a direction to focus on and the steps you need to take to get there.

Other effective money habits include developing good money management skills and a healthy mindset. These both will help you strengthen your financial future. Learning how to budget, avoiding debt, and saving money will greatly increase your chances of not running out in retirement.

Just be careful to not get trapped in the belief that more money means greater happiness. In 2018, Purdue University published a study that revealed the point at which a greater annual income no longer had emotional benefits. The study found that once a person makes $75k a year, any increase in income actually tends to reduce life satisfaction.

Have a clear understanding of what you truly value and the vision you have for your life, and let those two priorities inform your financial goals and decisions.

What’s more important than money?

It’s probably not difficult for you to answer this question for yourself. But, it is important that you always keep your priorities in order. Otherwise, money can slowly start to create some of the problems mentioned above.

One way to maintain a healthy perspective of money is by keeping a gratitude journal. Take 5 minutes every day to write down 3 to 5 people and things that you’re grateful for. This will keep your focus on what you already have, instead of all the stuff you think is missing from your life.

Here are a few ideas you could add to your list:

  • The relationships in your life
  • Your health and well-being
  • The lessons and experiences your life has given you
  • The wisdom you’ve gained through the years
  • Your ability to keep learning and growing as a person
  • Your church and your faith

When you foster gratitude, growing, and giving on a consistent basis, it’s easier to keep money in its rightful place – as a tool that’s meant to serve you and support your efforts to create a fulfilling and purposeful life.

In conclusion: Money is important to live the life you want

No matter what life you want to create for yourself, you need money to make it happen. That’s why it’s important to practice good money management habits, and live below your means so you can save for the future.

Money can’t buy you happiness, but it can help you acquire things and experiences that create much joy and satisfaction for you. It can help you pursue your passions and purpose in life. And, it allows you to be generous and supportive of others in need.

Money is important to live the life you really want. To reach your goals and realize your dreams. So, take control of your finances and learn how to use it as a powerful tool in your life. Align your goals with your values and know your own answer to the question: why is money important to me?

Then, you’ll learn to master money instead of money mastering you.

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Money Is Important: Here Are 15 Powerful Reasons

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