What money really is

Training 15 minuteswhat is money

You are 19, a barista earning $900 a month for 120 hours of work. For now money is just a number on your phone screen. Time to see what stands behind it.

Training goal: See money as your own time

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Situation

1. First payday. Sneakers in a shop window cost $150 and your hand reaches for the card. Your hour is worth $7.50.

Buy them now, it is your first pay
Convert the price to hours, decide tomorrow
Take a 6-month installment plan

2. Grandma gives you $500 in cash for your birthday. Prices at your café rose 4% this year.

Hide it in a box on the shelf, it feels safe
Throw a party with the whole sum
Put it in a savings account with interest

3. Two phone plans: $12 a month, or $30 upfront for 3 months. You use 7 GB a month and have $800 on your card.

Do the math: the bundle is $10 a month. Plans are stable, take it
Do the math, but pay monthly: a move is possible
Take the biggest plan just in case

4. The manager offers weekend shifts: +$240 a month. On Saturdays you take a graphic design course.

Take both shifts and drop the course
Take the Sunday shift, keep the course
Turn it down, money is enough as it is

What you will learn

Money is a medium of exchange, a measure of price and stored work
Price things in hours of your work
Money that does not grow loses value to inflation

Your real-life step

Divide your monthly pay by your work hours. Before your next purchase over $50, convert it to hours.

Questions and answers

What is money in simple terms?

A medium of exchange, a unit of account and a store of value. In plain words, a shared agreement that these tokens can be traded for goods and services.

What are the functions of money?

Three main ones: medium of exchange, unit of account and store of value. Some add a fourth: a standard of deferred payment for debts.

Why does money lose value over time?

Because of inflation: prices rise, so the same sum buys less. At 4% inflation, $100 next year buys what about $96 buys today.

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Numbers are illustrative. A game, not financial advice.