If you ask anyone what their money problems are, 90% of them will tell you that it is with the amount of money they make. If only they could get a raise, or if that promotion would come through, or may God forbid, that wealthy relative dies and leaves them a bunch of money. They believe, then things would be better. But 90% of money problems are not with the amount of money a person makes, it is with how they spend the money they make. Most people do not spend their money wisely and find themselves always short on money. They think, “If only I had more money.”
More Money Doesn’t Solve The Problem
We have all heard of famous people who have made tons of money and lost it due to poor spending habits. We have also heard of the lottery winners who file for bankruptcy within 5 years of their winning. I personally know of two families that came into a bit of money, only to spend it on things that didn’t pay out in the long run. One family received a large sum of money from an accident, had a chance to get ahead and, within 1 year of having the money, find themselves struggling for money again. Another family I know received a bunch of assets including money from a loved one passing away, only to find themselves short on money less than 5 years later. More money will not cure bad money habits. Some would argue that it even makes the habits worse. What needs to change???
The problems most people experience comes down to their Financial IQ. We have all heard of the famous IQ (Intelligence Quotient) from our days in high school, so I think we all understand that IQ is synonymous with intelligence. So Financial IQ is how intelligent a person is with money. The problem that 90% or more of people experience is not with the money they make but with how they spend that money due to their low Financial IQ. They spend their money on liabilities. You know liabilities by now, right? Those things that take money out of your pocket. Things like an expensive car, a house, a new TV, etc…. These liabilities eat into the money they make and leave them with a feeling that they need to make more money to survive. Well, they don’t necessarily need to make more money to survive, but they do need to be smarter with the money they make. And the only way to do this is to raise their Financial IQ.
How To Raise Your Financial IQ
The best way to raise your Financial IQ is to simply start learning. Read books, watch YouTube videos, go to seminars on money. You can even talk to someone who has a high Financial IQ and ask them for help. Have them mentor you on the right things to do. Anyone can raise their Financial IQ, but it takes work and dedication to make that happen. I know a lot of people think they don’t need to learn anything new now that high school or college is over, but that is the wrong way of thinking. We need to be constantly learning and if you want to have more money, you have to study money. Or you at least need to identify some good money habits to establish and the bad money habits to drop. You can learn to be better, or keep things the way they are and see where that gets ya.
Too many people believe their money problems are a result of the amount of money they make. Though the amount of money you make does matter, 90% of their money problems are with how they use the money they make. Instead of using that money to make more money, they spend it on liabilities that keeps them poor. They strive to try and make more money, only to find more liabilities to take that money too. They have to improve their Financial IQ and learn how to use the money they have. Sure, it will take some sacrifice and some learning, but that shouldn’t scare anyone away. Make a commitment to be smarter with money and do that by learning as much as you can about how to grow it!!!
For a great book that helped open my eyes and changed my financial life, I recommend reading Rich Dad Poor Day by Robert Kiyosaki. You can pick up his book via my affiliate link below: