27 Oct Financial skill set to have…
When friends gather to discuss about finance, I would say majority will be complaining they are broke. Regardless a person if a person is a high income earner or not. So the question is back to why is this so. In my previous blog, I discuss about sportsman millionaire being bankrupt or a lottery winner lost it. So is income the only skill set 1 person needs to know or there are more to that. So basically there are 3 financial skill set set a person need to have in order to be successfully financially:
First financial skill set. Ability to EARN. This is most or majority of people is focusing on. Regardless a fresh graduate just came out from college or someone in their retirement age. Thinking of how to have more income to sustain our life/lifestyle. Example of skill set we need to have in this area is where our tertiary education focuses too and hence all of us have been focusing on this only. Find a good employer that gives good income, gets more certs to have a higher salary or work multiple jobs to have more. No doubt this skill set is important to have, but this is not the only one we should focus on. We will need to have a balance skill set for all the 3 areas that I will be discussing in this page. Only having a high income skill set without having the rest is equivalent to a high income earner which complains he is still broke.
Second financial skill set. Ability to SAVE. This is my weakness area. As easy it sounds, you cannot learn this by reading books nor any youtube channel. In most cases, financial guru will teach you about budgeting or using the envelope system with the main goal of teaching you how to save. This is psychology area and self control. There is nothing much can be taught in this area but how you need to prioritize what you want in life and not trying to keep up with the joneses. This is also where my thoughts of starting this financial coaching program to help people in this area. Having a person to help ensure you do not go off track isn’t a bad thing after all.
Third financial skill set. Ability to INVEST I think this is the word flooded all over the internet. Plenty of courses teaching you how to invest, where to invest and the more popular question which gives you the highest return. But again, don’t forget this is the just 1 of the financial skill set we need to have. Even though you can have the highest return from your investment portfolio but subsequently making stupid decision which is against your financial goal, all your hard-work will go into the drain.
Hope that give you a glimpse why people consistently complaining they are broke. They might be able to earn but unfortunately, instead of spending on real assets, they start purchasing unnecessary things and at the end of the month all their income goes to the drain. On the other hand, an average income earner, spend wisely save their money and invest smartly he/she will certainly more successful than the high income earner end of the day. I have also embedded this end to end skill set in my coaching program to ensure you know your goals and can achieve your financial goal end of the day.
Have fun learning & growing & more importantly make smart financial decision.