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Aristotle, the Greek philosopher known to some as “the first teacher” or “the master of those who know”, was one of the greatest intellects in Western history.
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Ethics and virtues are central to Aristotle’s philosophy of finance and money, which he delved into in Book IV of the Nicomachean Ethics.
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Let's look at what Aristotle thought about money, finance and wealth.
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Aristotle breaks down financial behaviour into different character types, including ungenerosity, prodigacy, liberality and magnificence.
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An ungenerous person takes their wealth too seriously, accumulating and unwilling to share even with those in need. Robbers and usurers are apt examples.
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Prodigals or wasteful people spend too much money on indulgences while saving too little. For instance, a gambler makes too little money to be playing but always indulges.
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Liberality is the balance between stinginess and wastefulness. A liberal man spends the right amount of money for the right reason and gets happiness from doing good.
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Liberality, which translates to generosity (with a sense of freeness), means showing appropriate care and consideration for money.
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A liberal person saves and spends their money for the betterment of their own lives and the welfare of others.
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No matter how well-off or poor one is, every person can be liberal with their wealth. If a person earns little and spends little, they’re being liberal.
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Those who are born into wealth or inherit it have an easier time being liberal with it, since it was not earned through struggle and are therefore freer with it.
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However, a person with vast amounts of wealth can be magnanimous, which means spending large sums for the benefit of others. Examples include a philanthropist.
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According to Aristotle, a person’s end goal should be thriving, being happy and doing good, not just surviving. Thus, he saw money as a means to achieve a fulfilling life.
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Being wealthy doesn’t mean possessing things; rather, it's the way one uses their things that makes them wealthy.
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“Wealth is for the sake of life, not life for the sake of wealth,” Aristotle said.
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