Wednesday, 26 November 2014

Why Are Many Smart People Not Rich?

Being smart can certainly help in becoming rich but it's by far not the only and by far not the most important attribute.

I have studied and talked to a lot of rich / financially free people and found the following attributes to be far more important than being smart:
  • Having guts, taking risks, and the willingness to constantly expand out of your comfort zone. The willingness to make mistakes and fail and learn from it. Many smart people are restricting themselves by thinking too much about the risks and then not acting upon opportunities.
  • Getting the real financial education - you typically can't learn this at school or university (most teachers and profs are poor) and neither from your parents (unless they are very rich) or from an advisor. Why would you take advice from a financial consultant at a bank. If he knew how to do it, he would not work there in the first place. You get the real stuff only from the right mentors (rich people) and people who teach this and eat their own dog food, e.g. Keith Cunningham, Robert Kiyosaki, Harv Eker.
  • A positive mindset about money. Many poor (and smart) people think money is something bad, unethical, and that they have to be ashamed if they are rich. If you don't like money and don't think you are worthy of it you will not become rich because your subconsciousness will constantly sabotage you.
  • Developing strong social skills like dealing with other people, negotiating, persuading, being a good networker. IQ is not EQ. And even intellectually knowing something does not mean you will automatically act accordingly.
  • Self discipline, not looking for instant gratification, a continuous strive for personal mastery, improvement and lifelong learning, going the extra mile.
  • Taking action vs. just theoritizing about things. Being hands-on and pragmatic. Many rich people are more Doers than Thinkers.
  • Leveraging yourself through other people's time, money, and skills. There is a nice saying: If you are an entrepreneur and are the dumbest person at your company, then you have made a great job and hired the right people. Many smart people are reluctant to use leverage. They want to solve everything by themselves.

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