Will More Money Really Solve Your Financial Problems?

by Miranda Marquit · 10 comments

Suitcase with Heap of Dollar BillsOne of the most common financial pitfalls out there is having a poor money attitude. And among the worst money attitudes is the idea that all you need is more money, and that once you have it, your financial problems will be solved.

The harsh reality is that, while making more money can help your situation, chances are that it’s not truly a money earning problem you have; it’s a money management problem.

How Do You Manage Your Financial Resources?

There are some situations in which a lack of money really is the issue. If you’ve lost your job, or had a major and unexpected financial catastrophe, more income will really help. If you already have a steady income, however, your problem might not be that you aren’t “rich.” It might be that you’re not managing your finances as well as you could.

It doesn’t matter how much money you have if you don’t manage your resources so that you’re living within your means. If you don’t live within your means now, chances are that you wouldn’t live within your means if you had more money. More money is likely to just mean that you experience lifestyle inflation, which also means that you’ll still be in debt.

Think of all those wealthy athletes and other celebrities who end up going broke. Their problem isn’t that they don’t have a lot of money. It’s a management issue. Before you can solve your financial problems, you need to look at your money habits, and the way you manage your financial resources. Until you start employing sound financial management principles, you’ll always have money problems — no matter how much you make.

Take Charge of Your Finances

One of the biggest problems with the “more money will solve my financial problems” mindset is that it encourages you to hand over your financial destiny. When you say that you need more money in order to fix your situation, you’re relying on outside forces. You essentially choose to make yourself impotent in your own financial destiny. Instead of taking charge, you’re waiting for something else to come and “save” you, whether it’s getting a raise or promotion, winning the lottery, or receiving an inheritance.

The idea that more money will solve all your problems is a very passive mindset. Instead, if you really want to tackle the root of your financial difficulties, you need to change your mindset to one that is more active. Recognize that you need to make changes in the way you view your situation and the way you think about money. Reflect upon what actions you can take to improve your financial lot in life.

Even if you’ve experienced an unavoidable financial setback, it’s possible for you to take charge of your situation and move forward. Think creatively about how you could earn more money. Think about how you could work smarter, as well as harder, and how you could put your money to work for you.

Recognize that you can make a change. You don’t need to wait around for someone else to grant you a higher income. You are in charge of your own financial future.

Have you fallen vicim this attitude before? How did you overcome it? 

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{ read the comments below or add one }

  • Nancy says:

    About to lose my home because I am running out of retirement funds. Owe too much yo live on social security. I am about to go crazy. Do not know what to do.

  • Troy says:

    Having more money is actually not the solution to financial problems. Managing your financial resources carefully will help ease financial worries. Sometimes the more you earn, the more you spend money. Your lifestyle can totally change if you have more money.

  • John says:

    For many, having the security that money in the bank provides in and of itself is a use of the money. You say the farmer died wealthy at 96 never having spent a dime… but perhaps he “spent” his money on peace of mind, rather than on “things” That way he had both his cake and ate it too… he had wha the wanted most: peace of mind, plus he still had the money.

  • Kate says:

    The important thing is to know what you want to do and where you want to go. My Dad had a farmer that he tested milk for who was “saving [his] money for [his] old age.” He died wealthy at 96, never having enjoyed a dime, and his son blew the whole wad on the horses, never having earned a dime. My Dad always said that his will would read “Being of sound mind, I spent it while I was alive.” We had what we needed, and we took a lot of vacations (on the proverbial shoe string, but we kids didn’t know that) and two of us went to university, and he died with enough to keep Mama comfortable if she was frugal, and she is. And neither he nor she ever made more than $10,000 a year in their entire working lives.

  • Shane says:

    It can solve them, but if you are bad at managing money all together it could end up getting you more in debt.

  • Bert says:

    This is a great post. Since having my ID stolen, I have struggled to bounce back. Every penny I now earn has a thought out purpose. Everyone should consider these measures.

  • Ha'penny Bits says:

    Never a truer post (although more money would always help of course). I have friends who make a ridiculous amount of money, the husband was forced to take a pay cut that amounted to 2/3rds of his salary. The new salary is still 7-times my generous annual income, but he has to find $40K a MONTH just to cover the BASICS. He lives in a constant state of stress and misery. It’s terribly sad. More money doesn’t automatically equal financial freedom.

  • Terry says:

    Since I live on a poverty-level income, I’m confident that more money would improve my situation.

    • david sky says:

      Not sure if you are trying to make an intelligent sounding counter example, but the essay clearly states: “There are some situations in which a lack of money really is the issue. If you’ve lost your job, or had a major and unexpected financial catastrophe, more income will really help.”

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