The Truth About Money

Today is the day you discover the politically incorrect truth about money.

This lesson will probably be much different than the one your parents taught you. I know my mother would disagree with what I’m about to say.

Pinching pennies is a losing game. Obsessing about cutting costs is a waste of your valuable time and energy. You see, the only way to truly create financial independence and take control of your future is by adding value to the world and creating your own economy.

You don’t build wealth by extreme cost cutting. Instead, you build wealth by increasing your income so you have much more money to save and invest.

“But Craig”, you might protest, “right now all I can do is try to cut expenses”.

I understand. I’ve been broke.

Unfortunately, personal “austerity” can only get you so far. Sure you can cut and slash expenses to the bone, but eventually the fact remains that you always do get down to just the bone.

However, you have to eat. You need a roof over your head. And there are always going to be emergencies that come up. Those are mandatory expenses, and you can’t cut them.

Let’s take a look at a $40,000 per year income.

In the United States, a person making that much money, with no dependents, would be getting about $600 per week in take-home pay. Let’s say your monthly expenses are $600 for rent, $300 for transportation, and $300 for food.

You’re left with $1200 per month for everything else (and let’s be frank, you’re living a spartan existence – albeit a Westernized version – on the above expenses).

But wait, there’s more. Reality usually throws in a spouse, a child, even a pet, and things start to get tight. Real tight. Real fast.

That leaves with you two choices.

Put your positive energy into earning more money.

Or exhaust yourself with the negative mindset of cutting costs.

You can only do one or the other.

As NY Times best-selling author Ramit Sethi eloquently put it:

“We have limited cognition and attention, so each additional thing we try to focus on means an overall reduced amount of willpower and attention.”

If you had to use your limited willpower to cut back on $2 a day of something you love, versus learning how to negotiate a $10,000 salary increase, which would you rather do?”


Stop trying to cut costs to the bone.

Now you might find this callous or cold, that’s fine.

But I’m asking you to trust me…and to take all the energy that you put into slashing your budget and transfer it over to creating value.

It will make all the difference in the world to your wealth building efforts.

Let me tell you a little story.

Last year I visited Norway. It is the most outrageously expensive country in the world.

The Economist had Norway at the top of their annual “Big Mac” index. It showed that the iconic burger costs TWO times as much in Norway as in America. And a gallon of gas in Norway is $10. In Toronto, only $6. In America, even less.

And while I was visiting Bergen, Norway, we decided to check out a McDonald’s restaurant (NOTE: I didn’t eat anything there, I was just checking out the menu.)

Want to guess how much a Big Mac combo costs?

$15 USD.

In Toronto, that same combo costs $7.61.

As a result of Norway’s high prices, two of my traveling partners spent most of the time complaining about costs and discussing ways that they could cut travel expenses.

While they complained, I sat there. *Shrug*.

$4, $14, or $40 Big Macs, I really don’t care.

No big deal, I thought. If I want a Big Mac (which I don’t, of course), I’ll just go up to my room, add value to someone’s life with my writing, and encourage them to buy one of the dozens of valuable products that I’ve created to solve their problems.

Fair deal.

That’s how a free market works: Add value. Earn reward.

Normal people, those that don’t think like you and I, can’t do that.

They don’t have a positive outlet for economic energy. All they can do is turn money into a negative issue.

It’s too bad they haven’t discovered what you and I know.

And that secret is the bottom line.

It’s easier – and more positive – for you to ADD value to the world and earn greater rewards than it is for you to try and cut costs.

It’s easier to make money than it is to slash expenses.

Now before you disagree, just hear me out.

Making more money is a simple equation.

After all, you are already making money with your skills, right?

So to make MORE money, all you need to do is take your skills, add the way you create value and do it for more people.

That’s it.

Add more value = make more money.

It’s not rocket science.

Nor is making money the root of all evil.

The correct phrase is:

“The love of money is the root of all evil.” – 1 Timothy 6:10

BIG difference.

And not only is money NOT evil, but in fact, money is the answer to a LOT of life’s problems.

Don’t believe me?

Try going without money for a day.

You might be able to do it if you spend all day in bed, but you sure as heck better not allow your browser surf over to…because you’ll wish you had money then.

So back to your money problem.

If you need more money, the best thing for you to do is to switch from a negative cost-cutting mindset to a positive value-adding approach.

If you need money, you must find a way to MAKE more of it.

You can only slash your spending so far. At some point you’ll hit the bone of necessity – and you can’t cut that.

So you need to switch your energy over to creating more value.

Better to do it now while you’re young and full of energy.

Yes, this message is politically incorrect. And yes, it goes against everything that you and I were brought up to believe…

That making money is hard.

That getting rich probably involves something shady.

That it’s better to be frugal and clip coupons and drive an extra mile to save a penny on gas (even though this is the ultimate waste of time). That approach is WRONG.

I dare you to believe me…that you can add value to the world, make it a better place, AND make more money ALL at the same time.

In fact, when you make more money, dozens of people will directly benefit from it.

OR you can deny this premise and live in a zero sum game world…thinking that if you make money that it must be by taking it from someone else.

You can slash to the bone or you can afford $14 Big Macs.

It’s your decision to belive the truth about money or to deny its existence. Your choice.

Choose wisely.

[Ed Note: Craig Ballantyne is the editor of Early to Rise (Join him on Facebook here) and the author of Financial Independence Monthly, a research newsletter to provide a blueprint to helping you take control of your financial future. Each issue has topics dedicated to personal finance, advancing your career, building your on and offline business. His recent research uncovered a unique way to make credit card companies pay you. Discover how you can make money with your credit cards. Click here to learn more.]
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  • steven chan

    Amen !

  • Craig, I think this is my most favorite post you have ever written!!! This is the mindset I have shared over and over again. It does not matter whether you have a little or true abundance in all things, if you focus on pinching pennies, you will believe in scarcity. If you focus on adding value and PLACE value on what you share (a real key in the equation) the result is growth in income.

    Working with the nonprofit sector for many years now, I have encouraged board leaders and staff to place value on their knowledge and services, as a real business. I believe it would change the status of the programs, products and services provided to communities, and acknowledge the value added to economies by their presence.

    Would be interested to hear your thoughts on this, Thanks!!!

    • Craig Ballantyne

      Hi Bonnie, I think you are absolutely right. It is better to add value and go out there and earn rather than trying to cut, cut, cut and think that there isn’t more out there. Thanks for your kind words,

  • Nanoo Visotor

    Black and white, vs shades of gray. Julian Simon has argued extensively that human ingenuity is our ultimate resource (eg book “Ultimate Resource 2”).

    If value added does not require material resources, wealth added could indeed approach infinity. Otherwise, there will always be limitations to overcome. Working around scarcity or other obstacles, of one kind or another cannot simply be wished away.

    As a presentation on “Achieving Childhood Dreams” put it: “Brick walls are there for a reason: they let us prove how badly we want things.”

  • Tammy

    Interesting article. I have never really thought of money in this way- it always made sense to clip a coupon for something that I know I am going to buy. It seems like to get a bargain is a good thing. Why should we waste money that we have just to buy something at full retail?

    • Craig Ballantyne

      The argument is…Why put the energy into clipping coupons for dimes when you can turn that energy into adding value to the world, solving people’s problems, and getting paid in dollars?

      Neither is “right or wrong”, just two ways to live.

  • Craig,

    Great stuff. Absolutely. Why waste time thinking about “lack of” rather than putting your efforts into creating value for people in this world. There is nothing wrong with getting a good deal or spending less on something, but the critical factor is where your mindset is at that time. Knowing you can create more wealth is much more powerful than hanging on to pennies. With a positive self-expectancy about wealth building, rather than a negative “lack of” thinking, you will empower yourself to reach your visions.

    • Craig Ballantyne

      Very well said, Dave, thank you.

  • Excellent article Craig! I’ve been trying to educate & train my audience on the results they can achieve, simply by changing their MINDSET & PERCEPTION on this topic. Ultimately, this will determine who will succeed & who will fail.

    Well said & a well needed reminder….

    • Craig Ballantyne

      Thank you Shanna, greatly appreciated.

  • eva

    Hi Craig…I appreciate your articles…when an unexpected expense comes into my house(maybe extra on the electric bill, etc.), the first thing my husband does is take his budgeting papers out and spends hours figuring out how to “cut” from what is already a very tight situation. I have a shop on Etsy and my first inclination is “what can I offer that will get extra money” and then I get busy with that. It is my goal, by listening to you and following your techniques, to finally realize the American Dream again…the dream that my parents followed when they came over here from Denmark in 1947 and that I somehow lost along the way.

    • Craig Ballantyne

      Eva, thank you so much for your feedback and real-life story. That’s exactly what I was trying to say, and you’ve said it so much more eloquently. Thank you again, and keep going, keep pushing, you’ll find your path to success.

  • E.T.

    Fantastic post. I love reading it. In fact, I think I’ll “steal” a few of your sentences. No worries: I write my blogs in a different language 😉

  • James

    Right on the money, thank you! You’ve caught me at an inflection point. I’ve spent the last couple of months taking my family’s cost base down to a more manageable level, so that we can save and invest a little more. It needed to be done, but I can relate entirely to what you are saying. The cost-cutting took energy away from all the value-adding things I do for a living every day. It was negative. It made me negative and less productive in so many respects. It’s not how I want to live. This article is a well timed boost to steer me back on to the value track and enjoy the positive mindset that comes with it. I’ll try to stay on it this time too! Thank you!

    • Craig Ballantyne

      Thank you for sharing your experiences James, very instructive.

  • For anyone that loved this article, you will absolutely love this presentation:

  • Thank you Craig, for showing that value addition promotes satisfaction as opposed to greed. .

  • Wilfredo

    Wow! This one is a masterpiece. Thanks a lot for sharing it!

    • Craig Ballantyne

      Thank you!

  • Els

    Great Article! This stuff should be taught in school. Perhaps then our jails wouldn’t be so over crowded with people who’ve lost their freedom because of their false belief that one can just make money without having to earn it and as you said, the only way to do that is to make ourselves valuable to other people, not for the love of money itself, but for the benefit that your service or product brings to humanity. Well done!

    • Craig Ballantyne

      Well said, many thanks!

  • T

    Yes. I concur. A true masterpiece.

    • Craig Ballantyne

      Thank you!

  • Terry Gachoka

    Punch advice, love it 🙂

  • Hi Craig,

    It feels so much more natural to want to cut costs in the old paradigm. But it’s so much more fulfilling to add value to increase income!

    Thanks for the reminder about multiple attention and diminished effectiveness.


    • Craig Ballantyne

      Happy to help!