The Four Uses of Money

Last night at dinner I sat spellbound listening to the stories a very wise man was telling about his life. He had grown up poor in the mountains of Virginia. He learned at a young age to be entrepreneurial if he wanted anything out of life. The local industry was coal mining. Not a high-paying career and not a safe career in the mid-1900’s.

This man worked at, then owned many businesses—ultimately earning and saving millions of dollars. Last night he shared with me that there are only four uses of money:

1. Necessities: food, shelter, clothing, etc.
2. Peace of mind: building a cushion of savings for emergencies.
3. Comfort: earning and saving enough to live a nicer lifestyle beyond the necessities.
4. Giving: sharing resources(time, money, knowledge, things, food, etc.) with others is deeply rewarding.

The opportunities that open up when you have the first three covered are fantastic. At an age that most people are retired, this man is working more than full-time running a non-profit. One thing the non-profit does is provide scholarships for college. Some recipients are from families who’ve never had a college graduate in the family. He shows kids a way out of generational poverty. He has helped countless people through the non-profit and directly mentored dozens or hundreds of college and early-career young people.

In fact, one young person was with us at dinner. He had been mentored as a college student in the late 1990’s. Graduated college in 2000. Now works in Washington, DC in government AND owns a couple very successful businesses. He spoke glowingly of his mentor and what was poured into his life.

What a legacy! What a great use of money and time.