KDan writes: I am not an economist. However, most people misunderstand money and its purposes and uses so badly that I feel compelled to write out my understanding of it. Perhaps because I am not an economist, this might help some. The first and perhaps most important mistake people make is to confuse money for wealth. The more I earn, the more I realise that wealth is not money, but the ability to generate money (and other things of value). This is akin to the difference between saying "I am a dancer" (i.e. I have the ability to dance) and "I was a dancer" (i.e. I once had it but I no longer have it). Being wealthy is equivalent to the first statement, while having money is equivalent to the second.