In the book of Matthew, it is written, “Seek and you shall find”. This is a bible verse that resonates in the minds of many when it comes to looking for money. Despite putting in the effort, most still find it challenging to make enough money and end up asking: why is it so hard to make money?
The belief that hard work brings more money is long gone and many now believe that making it in life is just but luck. Even though time changes things, this is not entirely true. There is a reason why you might find it hard to make money while your friend, family member, or colleague finds it easy.
Why Is It So Hard To Make Money
There is no single reason why making money is hard. It is a multitude of reasons but a person would demonstrate one or two of them.
Economic Factors
Inflation and Its Grip on Purchasing Power
Ever heard of the phrase “A dollar today is worth two tomorrow” and the time value of money? Inflation and purchasing power take these into consideration.
Inflation is a silent predator of currency value as it gradually undermines the purchasing power of money. Its impact on money often becomes valid as time progresses. For instance, the impact of current-day inflation would be felt a year later. Consider a scenario where the inflation rate is 4%. In this case, if a product costs $100 today, the price would go up to approximately $103 a year from now. Although this might not seem like a modest increase, it is the cumulative effect over the years that become substantial.
In relation to making money, the implication of this erosion of purchasing power is significant for savings and investments. People who fail to account for inflation in their financial planning end up finding it challenging for their savings to adequately cover future expenses. This is also the case for investments that yield returns below the inflation rate as it leads to a loss of real value over time.
Job Market Challenges
It is no doubt that the job market has become a dynamic and fiercely competitive arena. This is mainly due to the technological advancement taking place and ever-evolving requirements and skill sets.
Data from the World Economic Forum indicate that more than 75 million jobs were lost to automation in the year 2022 and 133 million new jobs were created. Also, a report from McKinsey & Company holds that up to 275 million workers across the globe might have to switch their occupations by 2030 because of automation.
This data serves as an illustration of how automation has led to job displacement in certain sectors. This is due to jobs once performed by humans being executed by machines, demanding a workforce with a different skill set.
The traditional career trajectory of obtaining a degree, entering the workforce, and retiring from the same profession is evolving. The order of matters nowadays is lifelong learning, up-skilling, and embracing technological literacy. Without these, making money in the job market becomes a nightmare.
Personal Finance Challenges
Apart from the economic factors, there are personal finance issues or factors that make it hard for you to make money.
According to WorldRemit, in a study focused on the global cost of living index, 73% of the respondents in the United States, 70% in the United Kingdom, and 78% in Australia reported an increase in the daily cost of living. This is connected to the contemporary economic landscape that has ushered in a surge in the cost of living, creating a formidable barrier to financial success.
Currently, the dream of homeownership comes with a hefty price tag. For most people, the prospect of saving for a down payment and managing monthly mortgage payments has become an arduous task.
Despite the saying “Health is wealth”, preserving one’s well-being often comes at a steep cost. If you grapple with rising insurance premiums, out-of-pocket expenses, and unexpected medical emergencies, it is possible to easily deplete your savings and be hindered from accumulating wealth.
Let’s not forget the burden of education expenses. Although investing in education is an investment in the future, the rising costs of higher education have become a formidable financial hurdle. Student loans which are a common means to finance education saddles graduates with substantial debt affecting their financial stability well into their professional lives.
The mismanagement of credit card debt also plays a role. The high interest rates and the ease of accumulating debt contribute to a cycle where minimum payments barely make a dent. In most cases, people grappling with credit card debt find themselves caught in a precarious situation.
Psychological Barriers
Have you ever thought of how the fear of failure has made you not realize most of your dreams? This form of fear is a potent psychological barrier that casts a shadow over the pursuit of financial success. Often, this stems from the deep-rooted fear of judgment, self-doubt, and the potential consequences of falling short.
This acts as a paralyzing force and it prevents people from taking the necessary risks. In this case, these are risks capable of propelling them towards entrepreneurial ventures and other opportunities with the promise of financial gains.
When talking about fear in the context of making money, what is being underscored is the hesitancy in starting a business, launching a new product, or making a bold financial decision. This makes us forget that failure is an integral part of any journey towards success.
In order to make money and overcome fear, you have to shift your perspective. Instead of viewing failure as a dead-end, embrace it as a stepping stone towards growth. Get to understand that setbacks are temporary, not permanent and you will do a lot.
Another aspect of psychological barriers is the beliefs that you hold about money. Notions like “money is scarce”, “wealth is only for the fortunate” or “financial success is unattainable for me” hinder financial growth. Know that what the mind can conceive is attainable – we become what we think of. If you believe or associate yourself with such negative notions about money, then you will find it hard to make money.
The belief that you will make money and put in the necessary effort and it shall be so. Challenge limiting beliefs and you will be able to foster a healthy mindset towards wealth accumulation.
Lack of Financial Education
The level of financial literacy does have an impact on how making money is hard or simple for you.
When a person lacks financial education, it becomes challenging for them to make informed decisions. This means that they make decisions that are uninformed and that have lasting repercussions. From the accumulation of high-interest debt to neglecting important investment opportunities, the consequences of financial illiteracy can extend well into the future.
Final Comments
The answer to why is it so hard to make money is due to individual factors like financial illiteracy, negative mindset and behavior (beliefs about money), lack of skills and education, and economic factors like stiff competition for jobs, automation, and the high cost of living. Together, these factors make it hard to make money like people used to in the past. Even though time has passed, making money should not be, but apparently, the sad truth is that making money using traditional means is becoming more and more infeasible. If you want to make money, you have to adjust your mindset and think outside the box. Consider ways to make money online or even invest in precious metals like silver and gold.
