Money matters

Frankly speaking, it is almost impossible to imagine life of a modern person without money because we need to pay practically for everything in this life except mother’s love, father’s guidance and friend’s support.

Money is medium of exchange. Many centuries ago when money didn’t exist people used barter – people exchanged some goods they had for goods they didn’t have. Later commodity money appeared: at first fur and salt served as money, then people started to use precious metals to pay for different goods. The first paper money appeared in China in 1024. Today it is widely used across the world.

For what purposes do people use money at present? First of all it is still a medium of exchange; when people want to buy something they need to pay for it a certain amount of money (they can pay for goods or services in cash, with the help of cashless transfers or electronic money). Money is also used as a unit of account – money determines cost of all goods and services. Owing to money each person can interpret prices, costs, profits and debts; in such a way people have an opportunity to monitor their financial situations, plan their expenses and measure their future profitability. It is also a well-known fact that money is a store of value – it means that money can be saved for future use. Certainly it is better when money works and brings its owner profit, it’s possible as well to put money to a bank and receive interest from it – in such a case a person will receive less profit but risk will be minimized.

Finally I want to say that the role of money in life of modern people can hardly be overestimated but at the same time we need to remember that not everything in life can be bought for money.