Are You Smart About Money Issues?

June 21, 2013 | By More
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Are You Smart About Money IssuesIf you’re an adult reading the Post today, how long has it been since you took a science class? I don’t know about you, but the one memory that stands out for me is the science class I took in grade school.  The countertops lining the edges of the classroom were filled with all kinds of stuff.  Glass jars, Bunsen burners, clips, boxes, and a myriad of other strange looking items scattered along the surfaces.  I have to admit it was an intimidating sight.  Since I never had taken a science class before and didn’t know anything about it, I made some immediate assumptions.

Assumption #1:  I don’t want to do this.  It’s going to be too hard.
Assumption #2:  I’m never going to need to know this in real life.  Why bother!
Assumption #3:  I’m not going to feel comfortable working with the tools and equipment.

The funny thing about assumptions is that if you’re not careful, they can become self-fulfilling prophesies.  In other words, what I think to be true becomes true because I think it’s true.  (How’s that on a play of words!)  You know what?  I made it through my first science class just fine.  It actually turned out to be fairly interesting and helped me get to know myself better.  Even at that young age, I knew that the sciences wouldn’t be an area I’d consider as a career.  I was a right brained person, that is, a creative individual drawn to music, the arts, and history.

When I talk about my work as a personal finance writer and researcher, people often share their assumptions about their relationship with money.  The assumptions are as varied as the individuals I talk with.  If you strip away all the excuses, I’ve found it really boils down to the individual’s self-perception as to whether they are “smart enough” to understand issues about money.  Let me give you a couple of examples:

Money Assumption #1:  I don’t know who to trust or where to begin, so I don’t bother.
Money Assumption #2:  It’s too complicated, so I let my spouse deal with the money.
Money Assumption #3:  Interests rates are too low, I don’t trust the stock market, and I can’t save enough to make a difference, so I’ve given up.

To be frank, many of the money assumptions people tell themselves are completely and utterly without merit.  It’s really unfortunate, too, because you can be smart about money issues.  It really just comes down to what you tell yourself.  Really!

A few years back I was an active member of the public speaking group Toastmasters International.  One of the most rewarding aspects of my membership at the time was mentoring others on the skills of public speaking.  The one secret I shared with everyone I worked with was this – speaking in front of others is a mind game with your head.  Most people afraid of speaking in front of others are scared they will look foolish, make a mistake, say the wrong thing, whatever, but it all comes down to what they think is going to happen.  Being smart about money is really no different.  It’s a mind game with your head.

If you think you’re smart about money, you absolutely can be.  The secret about being smart about money is gaining knowledge, using the right tools, and being a little gutsy or, in other words, build up your self-confidence.  And, sorry, building your self-confidence comes back to ramping up your knowledge and using the right tools.  It all comes full circle.

Here’s the deal.  We are only as smart about money as we believe ourselves to be.  You have to believe you can be smart about money.  Once you tell yourself that truth, then it’s really a step by step forward process.  I’ve said this before, but I’ll say it again.  This is why we created MoneyBasicsU.  We’re going back to the very basics about money.  Daily we post on a variety of topics that are all related to money.  If you read a Post every day, do the homework, and apply what we talk about, you will absolutely be smart about money.

Let me just say this one other thing to hammer home the point.  Don’t think for one second that money issues are too complicated to understand.  And, let me be frank here.  Not doing anything about learning the basics about money is a HUGE mistake.  Putting off important personal financial decisions will not only cost you money in the long-run, but take away your option for choices.  Never let anyone, particularly yourself, tell you that money matters are too complicated to comprehend.

Okay, I guess that’s it.  The next time you ask yourself the question – am I smart about money – say a resounding YES!

Homework:

No homework today!

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Category: Banking, Financial Literacy, New to Banking

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