Why do most educated people struggle financially
Strangely have you ever noticed that most rich and wealthy people are minimalists and frugalists?
They love to wear comfortable cotton tees and dresses without much branded stuffs to show off.
Buy second hand cars and drive around unless the cars are required for branding purpose.
Stay at rented places unless really required to have your own space and enough money to afford the liability.
On the other hand, if you have observed, majority of the middle class working professionals (irrespective of their earning range), they want everything first hand, cars, gadgets, house, etc and get into the never ending trap of loans, loans and loans.
(Although there are good debts and bad debts, we will speak about that in a separate blog may be)
I remember this person who was my colleague long back came one day to office and started distributing sweets.
I congratulated him and asked what’s the occasion? He responded that he bought his house of 2 bhk. I said that’s a great news and how much was the cost.
He responded it was 1.85 Cr INR and continued to add ‘happily’ majority of it was loan from the bank.
First of all I could not understand what’s there to be ‘happy’ about in this kind of decision, was it the flat or was it the loan??
Anyway then I subtly responded ‘Oh okay, that means that flat owns you and not the other way round’. He got frozen for a few seconds, gave a nervous smile and went away.
In the name of ‘what should be done at a particular age’, like degree, marriage, settling down, children, do-nothing good for the world and then die, this entire loop has left humanity paralized.
Unfortunately the educated people (only through degrees and no practical life lessons) are the ones who fall into this trap and get into a never-ending loop. Because in schools and colleges typically the practical things about life are never taught.
So few things that needs to be kept in mind when it come to finances –
- Clarity about your life
- Once you have the clarity, have a financial plan in place
- Define what sort of lifestyle you want to have, frugal or minimalistic or maximalist
- Set financial goal and strategy for 1 year, 5 years and 10 years (It’s funny how people underestimate the power of what they can do in 10 years and over estimate the same for 1 year!)
- Number of streams of income and the sustainable model for it
- Automation and compounding plan for your finances
- Up-to-date on the changes in the market and economy
Whatever you do ensure that you educate yourself in terms of finances which is also a huge part of your self-development process.
Whether you run a business or not, does not matter. You need to know and understand how finances work.
Most importantly shed off any negative limiting belief if you have towards money e.g. money is the root cause of all evil.
No. It’s not.
It’s just a medium. Money is spiritual.
It only enhances who you are as a person.
If you are more on the negative side of life it will enhance those qualities, if you are more on the positive aspects, it will enhance your respective qualities.
Think of it like this – if you get a vegetable knife today, what will you do? Chop vegetable?
If the same vegetable knife is given to a terrorist, what would that person do? Chop human beings!
So is the vegetable knife evil or faulty? You know the answer.
Think about it.
Would love to listen to your thoughts about it.
Intensify Life!