If you want to be rich you don’t need good grades

Did your parents ever give you the advice that to become rich you have to study hard, get good grades so you can get a good job? I know I have heard this advice many times from my parents. But the fact is that getting good grades is no longer a guarantee that you will get rich. Even many doctors, who are often the ones with the best grades, are now struggling to make a lot of money. If you want to get rich, without the need for good grades, then keep reading.

One thing they don’t teach you in school is that your banker never asks for your report card. If you go to your bank and ask for a loan, whether it is for a business, a property or some other investment, then your banker is not going to ask for your report card. Your school report card has very little bearing on whether or not you will get rich. There are many highly educated people who are poor and struggling for money. There are also some very uneducated people who are millionaires and billionaires.

Schools are developed to train people to look for work, but this alone will not make you rich. Often, it is the educated people with the highest paying jobs who have the most debt and are in the worst financial situation. You don’t need good grades in school to get rich, but you do need a good financial education. Many people leave school without the slightest financial education. Many go deep into debt from school fees and spend their entire lives trying to get out of debt.

A little very simple financial education can save you a lot of time and trouble and can make you rich much faster. In fact, someone with a lot of financial education but not much school intelligence is much more likely to become wealthy than someone with school intelligence but now financial education.

In school you are smarter if you can make finer distinctions. Let me give you an example. If you can tell a car from a truck, then you have some intelligence. However, if you can tell a 1987 Ford Laser from a 1990 Ford Laser, then that’s a bigger distinction. You can understand things in greater detail and are therefore more intelligent. In school you will also be taught that there is often more than one meaning for a word. For example, the word libra means many different things. It can mean money, in the form of English coin, it can refer to weight, it can refer to a lost dog at home, or it can mean to hit hard. The word has multiple meanings.

In finance, some words have different meanings. Only in finance one meaning will make you poor and another meaning will make you rich. Neither meaning is right or wrong, just different, but they have very different results.

One of the most important words you will ever understand in finance is the term asset. Now your banker will tell you that an asset is anything he owns that has monetary value. This includes his old golf clubs, his suits, and his car. This is a correct meaning of the word active, but it will make you poor. A better understanding of the word asset is something that earns you an income whether you work or not. Simply put, if you stop working today, an asset will continue to put money in his pocket. A liability is something that takes money out of your pocket, whether you work or not.

Many people are poor because they spend their time buying assets that are liabilities. They buy things of monetary value that cost them money to own. Owning a car costs money every month. So even though, according to the bank’s definition of an asset, they are acquiring an asset, they are impoverishing themselves. The rich focus on spending their time and money to acquire assets that generate income. It is these assets that make them wealthy, and it is the ability to tell the difference between an asset and a liability that makes them financially savvy.