Part 3: Along with a lot or a little bit of money come management responsibilities

By Dian Vujovich

Having bank accounts filled with money can be both a blessing and a curse. The blessing is no day-to-day or month-to-month financial worries. The curse is the day-to-day and month-to-month requests for financial help from family, friends, non-profits, etc. that come along in addition to one’s living expenses. Having a bank account balance that runs close to the bone every day and every month makes financing life challenging too, albeit in a dollar different—but stress similar– way.

The managing, spending and dispersing of money is an ongoing challenge for pretty much everyone. Each year, no matter which end of the money spectrum you fall into, annual income amounts change, tax laws change, costs for things like groceries, telephone and wireless communication change right along with the costs of life’s must-haves, wants and necessities.

I find it horribly reprehensible that in America how to effectively and honestly manage money isn’t a value taught in the majority of schools across our nation or practiced within our government.

Perhaps that’s because the subject is such a complicated and daunting one that goes beyond our ability to do handle simple math problems and extends into our individual psyches. Studies continue to show that what and how we think about money has a lot to do with how well we do or don’t manage it.

Best selling author Charles Richards, Ph.D. recently published a book titled “The Psychology of Wealth” (McGraw-Hill, January 2012) that addresses a host of money-and-mind related issues. In an email exchange, I asked him four questions. What follows is his answer to the third question:

Q: In the whole big scheme of things, how much does our wealth have to do with how we live/conduct our lives?

A: “With abundant financial resources, one simply has more options in life. This may be the single greatest material and psychological benefit of financial wealth. Conversely, a sense of limited options is one of the most potent psychological stressors for human beings.

Nonetheless, with financial wealth comes a level of responsibility. It’s no coincidence that money is also called currency, from the word current—the flow of electric charge through a conductor.

To be the best stewards of financial wealth, we must learn to act as conscious conductors of currency. Learning to manage money responsibly and serve society is like being able to use electric current in a productive manner. With wealth, we can become powerful transformers for the currency of society. How we use that power is a great responsibility.

What I find interesting is that, no matter where one lies on the economic spectrum, experiencing a sense of psychological security and abundance requires approaching our financial and life goals with consciousness. This is particularly true when it comes to debt. With the recent economic downturn, we learned about the devastating impact—both for individuals and the economy—of mindless borrowing and spending. It’s important to find ways to borrow and spend that support our overall life goals.”

In his book, Richards also points out that there are negative and positive ways to manage the wealth we’ve been given. On the negative side come behaviors that are restrictive, miserly, self-serving and judgmental. On the positive side, one’s money behavior is generous, proficient, creative and discerning.