7 MINUTE READ from Wellness Interactive Branding, LLC.
“The history of money is all about well-being, and I don’t just mean having enough of it to live well. Money itself— i.e., having a medium of exchange that represents value we all agree on—makes life so much easier,“
The history of finance is as old as life itself. It has perpetually been a vital aspect of civilization, whether at a provincial or international level.
Finance originated in the Predynastic Period in Egypt (c. 6000 – c. 3150 BCE) and proceeded through Roman Egypt (30 BCE-646 CE). For most of its archives, ancient Egypt’s and Mesopotamian economy operated on a barter system without cash. “It was not until the Persian Invasion of 525 BCE that a cash economy was instituted in the country. Before this, finance flourished through an exchange of goods and services based on a standard of value both parties considered fair,” says history buff and financial expert David Morneau, who is also CEO of the marketing firm inBeat Agency. He says that by the period of the First Dynasty, international finance and economic systems had been inaugurated within the regions of the Levant, Libya, and Nubia. Egypt had a negotiating colony in Canaan, a number in Syria, and even more in Nubia. The overland trade route through the Wadi Hammamat wound from the Nile to the Red Sea, the goods packed and tied to the backs of donkeys.
As for the first banks, trace them to the temples in Greece, Rome, Egypt, and Ancient Babylon. It would be the Romans, though, who took banking out of the temples and into their own buildings.
“The history of money is all about well-being, and I don’t just mean having enough of it to live well. Money itself—i.e., having a medium of exchange that represents value we all agree on—makes life so much easier,” says Amanda Phalin, PhD, senior lecturer, department of management at the University of Florida in Gainesville.
Before money, how did we get what we needed or wanted? “We traded and bartered. If you had a pig but needed five chickens, you had to find someone who not only had a pig but also wanted your five chickens. You may have been forced to engage in multiple bargaining and trading transactions just to put scrambled eggs on your plate. Money—whatever a society chooses it to be— eliminates that time-and-energy-wasting process. Now we can get our eggs faster, leaving us time for making not just scrambled eggs, but pies, quiches, and even breeding the chickens for more eggs. Money makes our lives more efficient, allowing us to do more with the limited time and resources we have,” she says.
For sure, money has been top-of-mind in 2020. The pandemic impacted everyone financially. Many saw savings decimated; others struggled for the first time after losing jobs. On the flip side of the coin, some saved money because routines changed. There was no more commuting to work, or frequenting restaurants for date night, and no lunchtime outings or happy hour with coworkers.
The question now, though, is where to go from here? How to find financial peace when the pandemic and its effect will be around for some time to come. The experts weigh in.
“To build a sense of financial well-being — someone who is in control of their money — it will be important to shore up the areas of vulnerability that COVID exposed and create a forward-looking plan,” says Patricia Stallworth, a certified financial planner and host of the Minding Your Money Minute podcast.
There’s plenty you can do to rebuild your finances, or if you’re in good shape right now, to keep moving forward toward a secure financial future.
After this year, nobody needs convincing that wild stuff can and will happen that rock your financial world. Aim to have savings that will cover at least three to six months of your expenses. Knowing that you have a little something to tide you over instead of relying on credit cards will comfort you when trouble strikes.
Forget winging it. Going forward, create a budget and stick to it. First, identify your fixed expenses like rent/mortgage, car payment, etc. Next, look at your variable ones, such as entertainment and restaurants. See where you can trim them and take that money to build an emergency fund, advises Rubina Hossain, a certified financial planner and past president of the Financial Planning Association. Once you have your safety net, focus on retirement savings and other mid and long-term goals that may need tweaking given all that’s changed.
If pandemic-induced financial issues damaged your credit score, work on raising it as soon as possible. This will not only make you feel better, but a good score helps you qualify for lower interest rates and puts you in a favorable light, be it a potential employer or landlord.
Sean Messier, associate editor of Credit Card Insider, offers tips. “Apply for a secured credit card if you have the cash to fund the required security deposit. Use the card for everyday purchases, then pay off your full statement balance every month to avoid interest charges. This should make it fairly easy to boost your credit scores, as long as you’re managing credit wisely elsewhere.”
He says to consider repairing your credit with a credit builder loan. They’re specifically designed to help people with poor or no credit boost their scores, and they’re available from a variety of banks and credit unions.
Many people turned to credit cards to get through 2020. It’s hard to be at peace when creditors are calling. Make paying off that debt a priority. One common technique is to target your highest interest credit card first or the card with the highest balance. Pay more than the required minimum monthly, as much as you can, and on your other cards, pay the minimum. Talk about a mental boost. The victory of getting rid of one debt will energize you. Hit repeat. Move on to the next card using the same strategy. However, don’t make the mistake of draining your 401k to pay down some of your debt.
Says Todd Mosley, a bankruptcy attorney with the Mosley Law Firm, “I’ve had clients do this and still end up filing for bankruptcy later. They not only depleted their savings but deferred their financial recovery.”
Keep in mind the words of finance guru Suze Orman, “A big part of financial freedom is having your heart and mind free from the worry about the whatifs in life.”
Take advantage of historic low interest rates and refinance your mortgage. “A lower payment frees up cash that you can put toward savings or to chip away at debt,” says Marguerita Cheng, CEO of Blue Ocean Global Wealth.
Avoid temptation. Have a portion of your paycheck automatically directed to your savings account.
Capitalize on the fact you are not driving as much, not at the gym, don’t need new clothes for the office and the like. Instead of frittering away that money, re-route it into a savings or investment account. It adds up. Say you were spending $10 a day for lunch and pricey coffee, break that habit for six months and pocket that money. You’d save around $1,800. “That’s nice, but really take advantage of the pandemic and stick that $1,800 in an investment account for 25 years and forget about it. If it makes an average return of 7%, it could be worth $10,000,” says Casey Halliley, vice president of financial education for Sqwire, a financial wellness company.
When you’re on a serious savings mission, just relying on your paycheck won’t suffice. Generate extra cash. Make use of any special skills you have, like playing the piano. Offer lessons online or off. Consider opportunities like driving for Uber, delivering food, or tutoring online (many parents need help with homeschooling). Take inventory of your household for treasure that can be sold on Craigslist and elsewhere.
Right now, it’s about necessities. Everything else is a distant second. Work hard at trimming the grocery bill and the number of times you order takeout. Rethink subscription services. Evaluate necessities like your cell phone. Can you do better with another provider? With fewer expenses, you’ll have more money to get through any storm and reach your financial goals.
Sheryl Nance-Nash is a freelance writer specializing in travel, personal finance, and business. Her travel writing has appeared on CNTraveler.com, Newsweek. com, Afar, Sherman’s Travel, Orbitz, RD.com and TheWeek.com among others.
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