Big-‘E’ Number 4 – Education

Today’s Big-‘E’ is Education. (number 4 in a series based on words that start with the letter E and impact your financial future)

As I travel around Australia (and overseas) teaching people how to take control of their day to day cash flow the one common story people tell me is that “We never got taught this stuff in school!”

However, I expect you already know that some of the world’s richest people actually dropped out of primary school.

Education around money and financial matters is a huge factor in determining your financial journey (and destination) but clearly we need to go beyond the school gate when we look at the topic of financial education.

Where should you get it?

So what education do you need? Obviously schools let us down. So, do you need to do a university course and become a more highly qualified professional?

Here is a précis of an e-mail I received from an accountant who came to a recent CashFlow Clinic.

Hello David

Many thanks for the wonderful day on Saturday at the Cash Flow Clinic.

You might be a bit surprised to learn I am employed as an International Trade & Logistics Accountant for a large importer.

The reason I tell you all this is because I find it quite ironic, I am able to competently manage millions of dollars for the company I work for but have not been able to apply the same competence to my own personal funds! That is not until Saturday – my “Ah Ha Moment”

On Saturday I started a new journey ….. It is very exciting and I cannot thank you enough.

Many thanks, it is much appreciated.

Best Regards

Dawn

Obviously University education doesn’t do it either!

 

What’s the problem?

As I see it, the problem with all formal education is that it is focussed on preparing people for work. The higher up you go the more that is true. If you go to University it will be to study a specific skill so you can get employment or employ yourself in a specialised role (e.g become an accountant).

This might lead to a good income but not to wealth (If you read Rich dad Poor Dad by Robert Kiyosaki, you will find more to back up this claim). In almost all cases I know of, high wages means high expenses and no wealth.

Desire is key

So how much do you know about money and financial matters? Do you know about finance; structures; property investing; share markets and business?

Most of the wealthy people I know learnt all about these things because they had a passion to learn what they needed to know and knew it was crucial to them succeeding in the area they were passionate about. Most of them actually chose a career early in life that educated them in the area they wanted to excel in. They learnt whatever they realised they needed to know in order to remove the barriers they found in front of them.

I’ll give you an example. My friend Nhan Nguyen from Advanced Property Strategies quit University and got a job with a property company because he wanted to learn all he could about property. Every day he was working he was learning. Every night he was testing out what he learnt and learning more, going to seminars and looking for deals. He also looked for a mentor who was already successful and who would agree to teach him everything he knew.

Why would someone agree to pass on their knowledge and skill like this you might ask?

Simple; because they love to teach what they love to do and when someone comes along who is clearly passionate and driven, motivated and relentless, they can’t help themselves from wanting to pass on their experience.

Education is one of the biggest Big-‘E’s but there is education and there is education!
Chalk and Cheese

Formal education is all very lovely and you can decorate your wall with certificates and earn a good income but as I already said, this rarely leads to wealth. Yep, you will see professionals driving around in fancy cars and living in fancy suburbs but you don’t see the real truth about their finances. I’m not knocking formal education, but I am saying to just be aware it may not be all it is cracked up to be.

I have worked with some really highly qualified really high income earners who were really broke!

On the other hand you can choose your passion and decide to learn all you can about it. All valuable education comes from having the need to know something in order to solve a problem that is holding you back or stopping you from going to the next level. It gets you out of your comfort zone and into a totally different learning environment.

Nobody is there to tell you that you passed and hand you a certificate. You print your own certificates. You know when you have the solution to what is blocking your way forward.

 

Learning through passion

When you are driven to reach a goal you are not going to give up on, learning takes on a whole new dimension, and it is fun!

I spent thousands of hours researching and experimenting to learn what would help me to achieve success in an area I passionately wanted to make a break-through in. I now love to pass on that knowledge to others to help them as well.

Nhan Nguyen spent all his work time and his spare time learning all he could about property investing. When he hit a hurdle he went and found a solution and nothing was getting in his way. He now teaches others what he knows because he wants to educate them so he can save them the time and pain he went through.

 

Comparisons

Formal education tells you what you need to know even if you don’t know at the time why you need to know it. It stops at a predetermined point regardless of whether you really have all the skills, the knowledge or the passion. You accept that you need to know what the course dictates, even if you are not sure about why. You end up with a piece of paper that says you are qualified for something and then you are ready to begin the journey.

With self education you actively find out what you need to know because you are on a journey and want to achieve a particular goal. If hurdles get in your way, the only way you can get them out of your way is to learn really quickly what to do to remove them, to go around them or to go through them. You learn what you need to learn. Removing a barrier that is in your way and getting to the prize is the motivation that produces the energy and you are on a mission.

The end goal is not the education but the education is the result of the end goal. All successful people have learnt as a result of pursuing success and they want to pass on that success.

 

Solve a Problem

Big-‘E’ number 4, ‘Education’ is really important and comes from seeking solutions to problems that hold you back, motivated by a passion to succeed. The passion is probably not so evident or intense in the beginning but it grows the closer you get to the goal.

Whatever you do, to improve your financial outcomes you must focus on Big-‘E’ number 4, and my belief is that the best education is that which comes from passionately pursuing a dream or a worthwhile goal.

If you would like to begin on the path to educating yourself around money and don’t know where to start, you should look for a problem to solve and make a decision to solve it. Make it one that is really annoying you so you will find the drive to pursue it when everyone else would have given up.

If you just can’t come up with something or you feel you need to get the basics right first I recommend my Simple Wealth Steps Program as a great place to start. It is a ‘wealth basics’ education program and is activity based. Every week you have a reading and a task to complete. I have you doing something every week because nothing happens until you do something. Thinking about change does not make change happen. Taking action makes change happen.

That’s all for today. I hope you found this helpful.

David Wright