June 24, 2014

How we make money is interesting in that it is a bigger challenge for most of us. How we spend money is entirely within our own control, but to make money, we have to be useful/valuable to others. We cannot entirely control what others want.

How we spend money is interesting in a different way. It is the opposite side of the same coin. Someone’s spending is someone else’s earning. It’s like how we calculate GDP. I’ve wondered about how differently people spend their money. I’m sure companies like Mint would have a pretty good idea of this although their demographic is very skewed.

The biggest difference I notice is in how we spend our money in traveling. I know, for instance, some families who travel to Japan every year. A round trip ticket to Japan from NY costs about $1,800. If a whole family of four went, it’s $7,200. And, that’s just the plane tickets. If we considered the expenses in Japan, we are talking about 10K. Families that are not doing any better financially than my family is, are doing this every year. Personally this baffles me but I think it’s just a matter of priority. They are probably looking at the three MacBook Pros laying around in our apartment and wondering how we afford them. To me, spending ten grand every year on a trip that only lasts a few weeks is utterly frivolous. I would not do it unless I start making a million dollars a year (I’m not exaggerating). But for some, it’s so important that they would sacrifice anything else to do it. How we set our spending priorities reveals a lot about what we value in our lives. 

How we make money is interesting because it tells us how the world sees/values us. How we spend money tells us how we see/value the world.