Money Matters But Why Do We Turn A Blind Eye?

It’s no secret that money matters to a majority of people. But why is it that so many of us turn a blind eye when it comes to our finances?

Money matters more than just what we use it for. It has the ability to create enormous wealth and also collapse an economy.

If you gave men the choice between gold and wisdom, they will ignore the wisdom and take the gold. It is because those who do not know the value of gold , will watch it fall through their fingers.

The recent headlines about Silicon Valley Bank and Credit Suisse are prime examples. Silicon Valley Bank is the second largest bank failure in the United States after Lehman Brothers in 2008.

Mismanagement of money has consequences, especially when our financial system is intertwined like spider webs. On a large enough scale, it will impact nations globally.

On a smaller scale, mismanagement of personal finances also have consequences. 2nd generation wealth rarely lasts to the 3rd generation. Unless we are taught the wisdom to handle money, and the respect it deserves we will squander it away.

I do not think that we as intellectual beings are incapable of learning from past mistakes. However, we have a tendency to forget things easily.

We cannot have meaningful impact on how large financial institutions allocate their capital. But as individuals we can do our part in ensuring that our own finances are well looked after.

Money matters and it is time we stop turning a blind eye.

Finance Blues: Old is the New Gold

New things stay shiny, until its not. After a few days, months, or years it just becomes old and something we already have. It’s not long until you are searching for the next new thing.

In a broader sense, you can see this behaviour playing out in mainstream culture. Think about the need people have to change to the latest Iphone, wear the latest fashions or a drive a brand new car.

I am not saying this is wrong, but new things will always end up being old. If it ain’t broken, why fix it? Why do we turn a blind eye to our finances and try to keep up with the Joneses?

Let’s take this to an investing view. Raise your hands if your are guilty of looking for the next new company to invest in. Eventhough you have more than enough diversification in your portfolio.

Usually the best investments are already in your portfolio. Imagine owning 15 stocks, and adding an extra 1. Assuming that the 15 stocks were your best ideas, adding that extra one is adding money to your 16th best idea. Which means that its now your worst idea.

IPO’s are a good example of why newer is not necessarily better. The majority of IPO’s lose 90% of their value after the first year of listing.

Benjamin Graham’s book, The Intelligent Investor concludes that IPO’s do not stand for Initial Public Offering. It is more accurately describes as: “It’s Probably Overpriced, Imaginary Profits Only…” and so on. You get the drift.

Sometimes the best investments you have are already in your portfolio. Before you search for the next new thing. Look at what you already have, and tell yourself; Old is the new gold.

Money Matters, Slow Down Your Finances

What you do with your money matters much more than how you make your money. There are people with salaries north of $100,000 who are living pay check to pay check.

And then there are those that earn $60,000 and live financially free. What’s the difference between these two people?

It is that the former turned a blind eye to their finances, and the latter slowed down. There is nothing wrong with delaying consumption for future gratification.

Old is most definitely the new Gold. Because the new car can wait, the bigger house can wait, the latest phone can wait and the second holiday for the year can wait.

What can’t wait is your time. Time once spent has been spent, and there is no getting it back. Every delayed spending is purchasing you time in the future.

Slow down your spending, to speed up your financial freedom.

You would be surprised how many times I have witnessed customers at cafes who tap their cards only to have them declined.

They then stand there holding the line while they transfer money around. Sometimes they whip out another credit card and that declines aswell.

It is the lack of awareness of their current bank balances that baffles me.

Are we trying to spend money faster then it comes in? If so, who are we competing against?

It does not matter how much you make. At the end of the day all that matters is how you use that money. You can either spend it freely, giving someone else an income.

Or you can invest it wisely and give yourself income. Because money matters to those that know how it works.

Smarter Finance Is Not Complicated

Money matters, but it is no surprise why we turn a blind eye to our finances when most people are just living day to day.

It is much easier to avoid the giant elephant in the room when all we have to do is tap a card or a phone to pay.

You never need to handle physical cash or see how much you have. The sense of ownership is lost.

Why are there high income earners living pay check-to- pay check, high net worth actors or athletes filing for bankruptcy or lottery winners ending up broke?

They lack the wisdom to keep their money. But let that not be us.

Financial professionals want you to think its complicated, to make you think that you need their help. We cannot blame ourselves for being financially illiterate. Society has not adequately prepared us growing up.

The best financial advice can be obtained from a $20 book, a free podcast or a simple google search. Knowledge is power and gold is reserved for those who knows its laws and abide by them.

Lao Tzu a Chinese philosopher explains it beautifully, “Give a man a fish and you feed him for a day. Teach him how to fish and you feed him for a lifetime.”

If you teach yourself how to make money and keep money, then you will attract money. How can you attract money, if you don’t know its laws?

The best investment to grow your money is to focus firstly on yourself. Secondly pay yourself first and invest. Thirdly, spend less than you earn.

It is these positive habits, repeated over a long time that will allow you to be financially independent.

Key Takeaways

• Those who do not know the law of gold, will watch it fall through their fingers.
• Money matters! Save, invest and spend less than you earn.
• Gold is reserved for those who knows its laws and abide by them.

Incognito Wealth – Investing Tools

Need help with investing in the stock market or personal finance? Visit my Etsy store for digital excel templates. Simplifying finance so that everybody can reach financial independence.

Incognito Wealth - Financial Independence One Investment at a Time