Money and Empowerment

Hi All,

I’ve been thinking about this post for a while, but haven’t had a chance to get everything down on paper. There’s been a lot of discussion in the popular media recently about the role of bankers in the U.S. economy. With all the bad press about chasing dollars, some of you may be wondering what the overall point of building wealth is.

As bit of a refresher, here are some of the reasons why you should be focusing on improving your bottom line.

1) Money Allows You To Negate Office Politics: One reason why it makes sense to be financially secure is because it allows you greater freedom of action. For example, before I went back to graduate school I was working for a think tank in Washington DC. The job was terrific – I was making a lot of money, publishing a lot of papers – everything a budding social scientist could ask for.

Unfortunately, after a couple of years, my direct boss was forced out after a senior management change. After the change over he and his wife were persona non-grata around the organization due to some interpersonal conflicts among the management staff. This was a shame as both were really first rate social scientists. By the time he was forced out, I’d been able to bank about $100,000. Even though associating with my boss and his wife was politically risky, I was able to continue working with them without fear of losing my job due to my fat savings account. Having the money in the bank meant that I didn’t have to put up with the office political nonsense.

2) Money Makes Exercising Freedom of Speech Easier: This may be before some of your times, but back in 2002 Bush administration treasury secretary Paul O’Neill was kicked out of the government because of his open criticism of the administration’s policies. When asked what gave him the courage to speak out, O’Neill famously responded that they couldn’t do anything to him because he was independently wealthy.

One wonderful aspect of American society is our relatively high degree of freedom of speech. Unfortunately, speech that really matters is often critical or controversial. Very frequently by exercising it you can be subject to social pressure or in some cases job or business retaliation. On the other hand, if you are financially secure, this far less of an issue for you as you aren’t reliant on a paycheck.

3) Building Wealth is Linked to Character and Skill Development: While there are many ways to attain wealth, most first generation rich people had to work for it. Typically, this is through starting a business. Some are able to get it by saving and investing diligently over their life span. In either case, becoming wealthy is facilitated by developing new skills, sweating through trial and error and overcoming disappointment. While this maybe less of a factor for inherited wealth, there is a strong relationship between character and skill development and first generation wealth. When you are creating wealth you are usually gaining valuable skills that will last you a lifetime.

Many people seem to be ideologically or philosophically opposed to becoming wealthy. This is a shame, because achieving financial security can have tremendous benefits, more freedom and better skills are just a few.

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