Earlier this month, I saw an interesting headline reading "11 Things Poor People Will Never Understand About The World" that I expected to be a fascinating read, expecting it to twist the known habits that financially grounded individuals make that we have read thousands of times. Unfortunately, the majority of that article focused on the secret world of the rich, e.g. concierge services, renting celebrities, opting in or out of Forbes' wealthiest lists, without touching much (if at all) on where the financially illiterate population fail.
It inspired me to think of a few examples on my own that would more accurately live up to the headline.
*Know Thyself*
It is a cliché, but I watched a video from How Money Works on YouTube that concluded with a message about the importance of understanding your capabilities, your capacity and your limitations when it comes to professional and personal success. This aspect of "know thyself" is often ignored, especially in a social media world of generalized information perpetuating hustle culture and the power of positive thinking. It recaptured my common saying that "personal finance is personal." Yes, there are common grounds and a couple truisms (such as the more money you save and/or the more money you make equals the more money you will have).
For all the good that the power of positivity has brought certain people, there are cautionary tales severed from the mantra where people took on too much or set out to do the truly impossible. No amount of confidence will allow humans to fly. Likewise, all the logistics pointing to epic failures like Fyrefest, WeWork, Theranos or (most recently) OceanGate are insurmountable for that whole "fake it 'til you make it" ideology.
Individually, when an unprepared or incapable person seeks a life of wealth as the driver and enters a school of medicine to be a surgeon, that person is more likely to fall far short of their plan and end up deeply indebted in school loans. Comparatively, an average student who kept pace with the median income throughout a career and followed the recommended 15% savings into a basic index fund could end up in a better place, simply because they understood their own limitations without having to learn it through expensive lessons.
*Life is NOT Short*
This one harkens back to the 1999 film Magnolia where the wealthy but dying Earl Partridge (played by Jason Robards) lamented these words to his estranged son, Frank T.J. Mackey (portrayed by Tom Cruise). Time is a neutralizing currency, where everyone is entitled to the same 24 hours a day, irrespective of their wealth (or lack thereof), their age, or their individual traits.
My generation was hounded with "Life is short" so heavily that I feel many received the wrong message. If life were short, then it would be much easier to endure discomfort when the promise of resting in peace is right around the corner. But "life is short" is too simple to be a truism. There are some people living every day as if it were their last who become exhausted and defeated. It would be like training for a marathon by learning to sprint. Life is not as short as this overused cliché may have promised some people, and those people need to prepare properly for life as a marathon.
*Sacrificing > Suffering*
Piggybacking off the prior message, not all discomfort is endured the same. There is a big difference between sacrificing and suffering. To borrow from Dave Ramsey, "Adults devise a plan and follow it; children do what feels good." That planning can be the difference between making sacrifices to build a better life and suffering through life's challenges. The quintessential book on this topic for many could be the 2002 classic "A Purpose-Driven Life" by Rick Warren.
This message was taught to most children in my generation through ants and a grasshopper. Ants spent their sunny days stockpiling necessities for a rainy day whereas the grasshopper capre diemed the day, spending the time doing what felt good. When the seasons changed, the sacrifices that the ants had made bypassed the suffering that the grasshopper endured.
*Status Quo is NOT Static*
Personally, this one has driven me crazy when I hear my financially instable friends make plans that only resolves their current struggles. One of my favorite 1995 films was The Last Supper where the antagonist (at least, an antagonist to the main characters, but they were not the stereotypical protagonists) empathized with the struggles of the main characters by simply relating, "Life gets harder every day." I do not know where this message was lost on others, but so many people fail to realize the reality of emergencies or that struggles are inevitable. That whole "Why Do Bad Things Happen to Good People?" query is another thing that drives me crazy personally. As humans being, how is anyone too good for bad things?
Alas, I love to say "Life only gets easier when you try harder." For the uninitiated, they might misunderstand that advise as personal slander. Like a guilty man disputing his weapon of choice in court. It is not to say that those without an easy life have not tried hard nor that life improves with a little more effort. My words were construed to be understood that life will only get easier when you constantly put forth more effort than life is hard.
*All Plans Require Maintenance*
Admittedly, this one could have been tied into the non-static status quo above, but I felt the reality that all plans requiring maintenance is an overlooked lesson worthy of a separate entry. This message could be a chorus at every business school. Business schools teach students a large array of metrics to monitor the evolution of plans and how to keep them from falling off the rails, even if it requires redirecting the plans to "stake where the puck will be." Those lessons also apply to life with very little modification.
While the whole Dave Ramsey mantra of adults making plans is undoubtedly true, the unspoken understanding about plans is that they rarely pan out as initially envisioned. Plans consistently require modifications, renewed strategies and other testing. Just as the status quo will always change, planning to restore the status quo is only a temporary fix. Eventually (and probably sooner than later), the status quo will be disrupted again. By planning to maintain status quo, you are limiting your room for growth. Financial success is grounded in growth. Just as we invest our excess savings to grow, we as people must find time for plans to grow professionally and personally, lest time passes us by.
*Waiting to Next Year Is an Insurmountable Financial Mistake*
*Ignore your wealth*