You’ve probably heard stories of some celebrities or lottery winners who went bankrupt. Mike Tyson the boxer, 50 Cent the rapper, Majek Fashek the musician, Emmanuel Eboue the footballer to name a few. The story of Emmanuel Eboue, former professional footballer, and Arsenal midfielder is particularly heartbreaking. He went from earning millions of Euros per year to losing everything to his wife in a divorce. In an interview, he admitted that this was a result of his naivety in handling his finances.
There are plenty of such stories out there. And at the root of why these people went from riches to almost nothing is due to their lack of financial education. In other words, having a lot of money to their name didn’t change the fact that they were naïve with dealing with money.
It’s not only celebrities and lottery winners that self-destruct because of their lack of financial education. Every day people are also at the risk of living life in bondage and servitude due to their lack of financial education. The reason someone who has a life savings of $1,500 will buy a Smartphone of $650 as a social status symbol is that they lack financial education. The reason someone will work all his life depending on pension with no investment to his name is that he lacks financial education. And the reason people take loans to buy anything that is not an investment is that they lack financial education.
Whether you like it or not, society revolves around money. Money is the fuel that runs the economy. People go to school, study hard to graduate with good grades so that they can get a well-paying job. Money may not buy happiness but it gives the choice to do things that make one happy. Although people are usually not comfortable talking about money, it is an integral part of survival. This makes understanding money and its workings very important.
Unfortunately, this important skill that can make or break your life isn’t taught in school. You can graduate with a four-year degree and learn nothing about personal finance or investing. In this video, I want to share with you 7 important reasons why you should make your financial education a priority – and why it is the best investment you can make. Before we get to it, be sure to subscribe to After School TV for more insightful videos like this.
1. Only you have your best financial interest at heart
Here is an important truth you need to understand; everyone wants to take your money from you; legitimately or illegitimately. Right from the moment you popped out of your mother’s womb, everyone is trying to sell you something. The marketing and advertising industry is valued at trillions of dollars. The government wants your money; the school, your friends and relatives; the salesman; the cosmetic shop; everyone wants your money. Even the financial and investment expert that wants to help you preserve and grow your money; his own interest takes his first priority. Everyone has a conflict of interest.
Think about this; if you live in a world where everyone is after your money, why will anyone want to live in such a world without the knowledge to help them keep more of their money? Without financial education, you will work hard all your life and wonder where all your years of effort went.
2. People don’t tell the whole truth
There is much advice out there on how to make and invest money. The ridiculous ones promise to double your money overnight. Some promise business out of the box. There are get rich quick, high yield investment schemes. You’ve probably had someone try to introduce you to one of such schemes. These people will never tell you the whole truth.
Even when it comes to genuine business and investment opportunities, you don’t get to hear the whole truth of what is involved, until you get in. Without the right financial knowledge, you are bound to make grievous mistakes if you follow advice blindly. Financial education will help you to ask the right questions when anyone comes with their investment or business proposal. It is the only way you can know who is right, who is wrong, and why. It will help you get better at calculating risks and making smarter decisions with your money or lack of it.
3. There is no one road to financial success
Despite what the financial experts selling seminars and courses want you to believe, there is no secrets to growing wealth. There are many different ways to make and grow money, and there are many sources you can learn from. You can learn from books, seminars, courses or from videos on YouTube. But you can’t get real financial education from any of these sources.
Your true path to financial success comes from figuring out which of the many available investment strategies will work for your personal situation. Not all investment strategies are appropriate for everyone, but there’s the right solution for you. Your job is to find it and develop your knowledge around it. You’re a unique individual with your own skills, background, experiences, resources, and outlook on life. You have a risk tolerance unique to you and preferences, time frames, and goals that are different from everyone else’s. You have a unique gift to bring to the world. Your chance at financial success increases the more you capitalize on that uniqueness to build your wealth. If you don’t educate yourself to do it, nobody else will.
4. Your financial future is your responsibility
Your financial future is not the responsibility of the pension fund manager, the government, the bank, investment portfolio, or even your children. Your financial future is your sole responsibility. You can listen to all the investment advice, but the decision is yours to make and the consequences – positive or negative – is yours to bear.
When you lose your money in the stock market, in FOREX or Cryptocurrency trading, or in business, there is no one to go to for a refund. Financial literacy can help prevent you from making poor financial decisions that can take years to overcome.
You must learn how to invest your money because no one will ever care about it as much as you do. You are the only financial advisor that solely has your best interests at heart. Everyone else is in business to serve their best interests. The only way to make consistently smart money decisions is if you develop the financial knowledge of what works, what doesn’t, and why.
5. Your Financial Intelligence Compounds like Money
There is nothing more dangerous than a million-dollar worth of decision being made by a thousand dollar worth of financial intelligence. The reason lottery winners quickly lose all their money is that they have not developed the financial capacity to handle such money. Your financial intelligence acts as a ceiling that limits the growth of your wealth. As you raise your financial intelligence, you raise the ceiling on what’s financially possible for you. This is why it is important that your financial intelligence grows faster than your wealth.
Fortunately, financial intelligence grows and compounds just like money. New knowledge doesn’t just add up; it multiplies your overall financial intelligence. Your goal should be to make regular deposits into your financial intelligence account. Because the more you learn the financially smarter and even wiser you become.
6. It’s One Investment You Can Never Lose
Financial education is a one-time investment that pays dividends for the rest of your life. People can steal your money, but no one can ever take your financial education from you. Once you know it, you can never un-know it. The sooner you started developing your financial education, the sooner you’ll begin reaping the rewards. And the longer you enjoy financial literacy, the more value you will get from it.
7. It’s Way to True Freedom and Independence
No matter the amount of money you have, you’ll never be financially independent or secure as long as you depend on someone else to manage your money. Emmanuel Eboue and many like him are proof that financial ignorance can be so expensive that even the rich cannot afford it. You can’t experience true financial independence if you’re dependent on someone else’s experience and knowledge for your financial security.
So what should you do now? It’s simple: commit today to start growing your financial literacy one day at a time. Rome was not built in a day and neither is financial intelligence. You have to start wherever you are right now. Until next time; YOUR SUCCESS MATTERS!