Money is Not a Scarce Resource

  By Ann M Marosy

Making money is 90% thought and 10% know-how.  When I work with clients, I find the first major hurdle we must overcome, is their belief system governing money. 

I learnt how to manage money the hard way.  First, I had to lose all of my worldly goods and chattels before I could start again with a clean slate and re-learn the basics of money management.

I trained as an accountant in the roaring ‘80s – those heady financial days of corporate raiders, easy credit, overly generous bank managers and booming stock markets.  I suffered from most of the deadly financial sins.  I loved shopping, I overspent on my credit cards, I never had a home budget and, of course, I never saved.  Whilst I was a good company accountant, I never bothered to transfer that expertise to my own personal finances.  I didn’t have to.  The share market was booming and the market value of houses easily doubled every couple of years.

In those days I was married to a former stockbroker and due to his knowledge and expertise, we managed to escape unscathed from the stock market crash of 1987.  Our net worth escalated due to the rising value of our family home and the money we made on the stock market just prior to the bust.

I always wanted to run my own business and finally had the opportunity in 1991.  After my marriage failed in 1988, I moved to South Australia and worked as a consultant in the accounting recruitment field.  This gave me the necessary marketing skills to venture out on my own.  I opened my own agency in January 1991, the same time as the State Bank of South Australia announced their $3 billion loss.  We were heading straight into Australia’s severest recession since the 1930s and there was nothing I could do about it.

On the downside, I lost everything I owned.  However, on the upside, I gained the opportunity to re-visit all of my attitudes, beliefs and behaviours concerning money.  I did not declare bankruptcy and struggled through three years of severe financial hardship to pay my debts and keep myself barely in survival mode.

To recover from the enormous stress and hardship I faced after losing my business in 1992, I had to virtually reconstruct myself.    Yes, there were other important lessons relating directly to running a business, such as managing cash-flow and debt, but before these could become meaningful, I discovered that I actually didn’t think very kindly about money. 

Of course, my business was only a prop and the recession set the stage for my real lessons in life.  I had to experience firsthand what it felt like to lose all my money and material worth and then, later, to recreate my wealth using a different means – my belief system, or thinking.  Gradually I restored my confidence and sense of self-worth, but in a more constructive way than ever before.  I learnt the benefits of seeking a deep inner peace and started to examine my negative beliefs.  And what I found was alarming – I actually believed in scarcity!  No wonder I lost all of money.   Now, after working with clients from different walks of life, I know these thoughts are common in our society.

To change our financial position, often the first thing we need to do is examine our attitude, beliefs and thoughts about money.  Money is not evil.  Money does not cause greed.  Money is not the root of crime, war or violence.  It is not the possession of money that creates these problems; it is the absence of it.  It is the misguided belief that money is a scarce resource that leads to acts of violence and crime.  If the thief knew that there was plenty of money for him, would he still resort to burglary?  I don’t think so.  If we thought we had a bottomless bank account, would we bother hunting for bargains or lie on our tax returns?   No.  It is only the belief that money is a scarce resource that makes us want more goods for less money, or try to get more money than is our rightful exchange.

If you are surprised that I coupled bargain-hunting with tax avoidance, then think again.  If we lived in a financial Utopia where everyone was wealthy, all goods and services would be traded fairly and for full value.  Whenever we pay less than the full value of goods, we are cheating the vendor out of his rightful exchange.  It is only the belief in scarcity that makes us strive to pay less than what we should. 

The belief that money is a scarce resource is fundamentally unsound.  From basic economics, we know this.  If money was a scarce resource, economies would never increase or decrease, only the wealth distribution would change.  What causes economies to grow is the relative output and productivity of the country.  To make more money, we need to increase our productivity and provide goods and services that are required by the community.  By adding value to our community, we will prosper.

To cultivate “right thinking” regarding money, we need to first reassure ourselves that there is always plenty of money.  Have you ever stopped to imagine how much money there is in the world today?  How many hundreds of thousands of billions of dollars?  There is definitely no scarcity of money.  What we need to do is change our perception of how money can be available to us.  Instead of worrying about how little money we have, we should be saying, “How can I create more money today?”  We need to expand rather than contract.

I lost all of money in 1992 because I believed in scarcity.  Yes, fate dealt me a cruel hand but I know now that I didn’t have what it takes back then to really make it.  Early last year, illness debilitated me for several months and my father, who I was very close to, died; but these things did not deter me.  This time I became more expansive and more creative.  Life will always throw up little challenges for you.  You can succumb to them or you can continue regardless.  Nothing can stop you when you have the right attitude and the right thinking.

Wealthy people think expansively when it comes to money.  They will make money regardless of whether the economy is going up or down.  They look for opportunities.  They are proactive.  They are not afraid of failure and know that sometimes failure is part of the learning process. 

My favourite story of one man’s refusal to give up is about a man who wandered through life aimlessly until he turned 31.  He then decided to start a business but was bankrupt in 18 months.  Later, he ran for local government and was defeated badly.  He started another business at age 34 and went bankrupt again.  He fell in love with a beautiful woman, who later died.  After recovering from a nervous breakdown at 36, he went back into politics and again ran for local government.  He lost again.  At age 43, he ran for Congress and lost.  He tried again three years later – and lost again.  Two years later, he ran for the Senate but was defeated.  At 55, he again was badly defeated when he ran for his party’s nomination for Vice-President. 

He tried again for the Senate five years later, but lost.  Finally, at 60 years of age, he won his first elected office – the President of the United States of America.  He was Abraham Lincoln.  Lincoln later admitted he had a lifetime battle with fear and depression, but would never quit.[1]

Wealthy people keep trying, poor people stop – or never make the attempt in the first place.  “Life is either a daring adventure or nothing” Helen Keller inspires us.  I know a successful South Australian businessman, who over the years has lost a lot of money but made back even more.  “Its only money”, he says.  And so it is.

Money is a useful, necessary commodity in our world.  We need it to survive.  But it can also enhance the quality of our lives and provide us with the freedom to lead purposeful, meaningful existences.  Money is just a commodity; in itself, it is not tainted with any qualities.  It is not money that is the problem; it is our conditioned belief that money is scarce.  It goes against the very forces of nature to be poor.  Abundance is our birthright.  But the first step starts with you.  What do you think about money?  What do you think about being wealthy?  And what thoughts do you have about creating wealth?

Copyright © Ann Marosy, 2003