There is something funny about the word "Money". It is a very powerful word that signifies a lot of things including power, freedom, affluence, and connection. Some have mastered the act of making money, some are chasing after money with the aim of getting it at all cost, while some do not even know what to do to get it. While a lot of people will think that money decisions and making money has to do with mathematics, understanding spreadsheets, and numbers, it will surprise you that a lot of money decisions are done in places where there are no calculators at all, and one of those places is around the dining table or in house parties where things like previous history, ego, pride, and fear are looked into.
While we are all in the same planet, we all come from different generations with a little percentage being silent generation, a few being baby boomers, a reasonable percentage being Generation X, a large number Millenials, and Gen Z, and we all live in different parts of the world and all come from different cultural, financial, and religious background. Let's not also forget that we were all born into different part of the world where different values are held even as we live in different economies, and have different opportunities.
The financial decisions we make are based on the information that we have at the moment which has been passed by parents and each individual experiences. While the decisions might not be completely right or they might even be wrong completely but at the moment it is the best thing to do, and it aligns with their thought, experiences, and personal stories. While people have different ways of using, spending, and making money, we all strive to making more based on our knowledge and what is available to us, remember that there is no universal way of making, spending, and investing money.
Some people have decided to choose compounding as their own route in investing. People like Warren Buffet and Jim Simons. This strategy has proven to be king when it comes to investing ones money for a long period of time. People who do this put into perspective time, and increasing what they have in their assets by compounding. These people are not interested in short term gains, they would invest like their lives depends on it, and they will take their minds off it like they didn't invest at all. These people will invest in companies that they believe have the ability to grow and overcome the test of time. They do not focus on quick high returns, rather they are interested in steady long term goals.
The chances of being a billionaire based on opportunity is 1 in 1million and this is visible in Bill Gates journey and his access to a computer at an early age as well as access to an advanced one as at the time in his school Lakeside where only 300 out of 300 million high school student attended. Opportunity is key to success but when there is a competitive advantage, there is a high chance to succeed and this is why children born into homes with competitive advantage tend to do well financially than those without.
Talking about competitive advantage, we cannot but mention that luck and risk plays a great role in ones financial success. In the sailboat of financial growth, luck is very important and this is because there is no one person who would say that they attained their financial status without a share of luck and this luck will always be accompanied by risk either from the person who is giving the opportunity or the person who got lucky. When we talk about risk, it goes beyond what a person can control as most times it is based on external factors but it is important to always mitigate it.
We are all on this journey with little to zero understanding of what is next to come. I always tell myself that no one has it all figured out, we just do our best based on the information we have available to us, while standing on the legs of competitive advantage, as we harness luck and mitigate risk, and we hope that the best comes out of it financially.
For financial issues, for the issue that inflation exists, not being interested in finance is like letting yourself go. Not having a financial education is like letting yourself go and losing pieces little by little. At a certain point we need to start understanding the financial system we live in. Excellent topic. As you wrote, you learn along the way, none of us know the future.
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I think you have said this perfectly because a lot of people really need to learn this most especially. We need to know much more before we can achieve financial success beyond what we can ever imagine of
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