Money Sensitivity Why be sensitive? By Mo2

Money is a sensitive topic. When you talk about it a lot of people get uneasy. You can lose your best friend or fiancee with an argument over money. People commit criminal offences to get their hands on money. When it comes to financial education, most people have little to none. Few people know the differences between a chequing and savings account at a bank, never mind creating and maintaining your own investment portfolio. Why do you think so many people get suckered into paying bank fees for services they never use?

Confidence
One part of money being a sensitive topic has to do with how little confidence people have in their income. Of course, if you compare yourself to the likes of Bill Gates, you could be making 6 digits annually and still think you're poor. However, if you have a good grasp of your financial net worth and monthly budget, you actually could be wealthier than people that make significantly more than you. Sound like I'm contradicting myself? Not at all, just because you make more money doesn't mean you're actually wealthier than another.

Wealthy vs. Rich
One of the people I respect greatly is Robert Kiyosaki, well known for his Rich Dad Poor Dad series. He defines wealthy as someone that has more passive income than expenses. Basically, that means you have financial freedom. That doesn't necessarily mean that you're rich though. Rich people make a lot of money but they could be spending more than they make. The average US consumer is said to be spending more than they save, they're actually accumulating debt! I'm Canadian, but we aren't too far behind in terms of accumulating debt.

Your goal should be to become wealthy first and then rich second. If you can pay your bills just from your investments then you will have no problem increasing your net worth. (Take a look at my Net Worth Article for to understand net worth.) If you invest intelligently then you can watch your money grow as long as you can keep your expenses reasonable. .

My Favorite Investor
Take Warren Buffet for an example. Despite being the second richest man on Earth, he lives conservatively. Sure he has a private jet, but that's to avoid people like me who would hound him with the million questions if I were to bump into him. But he still lives in the same old house he bought a long time ago and really doesn't buy anything crazy, well except for the couple billion-dollar company here and there, nothing serious.

Face Reality
Money is here to stay and so is your financial health whether if it is good or bad. So get used to it and don't be sensitive about it. You don't have to tell everyone person you walk by how bad a credit you have, just be realistic and don't stray away from who you are financially. Don't say, "I'll do it eventually." Think about it, now! The more you think about your financial well being and the more you educate yourself, the greater your chances of being successful.

 

Mo2 Thinks...
We all have different tastes for food and clothes. Money is no different. Some might consider a $1,500 monthly paycheque to be enough and quite frankly it's more than enough in plenty of countries in this world. For some a million dollar annual salary may not be enough. What with the two Porche 911s and four Subaru STis they buy annually of course it's not enough.

You need to grasp the idea that you can control your living style. It doesn't matter if your next-door neighbor has a tennis court, swimming pool, bowling alley, and a rooftop movie theatre, guess what your next-door neighbor might be completely in debt. Understand what you need to live comfortably and strive to become wealthy. If you aren't at that stage yet, have the thirst for financial knowledge! Don't be shy to talk about it with people who care, don't be sensitive about money. Be confident with it and surely you're financial health will improve.

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If you would like to comment on this article or anything on this website, please feel free to e-mail Mo2. He can be reached at Mo2@Mo2Thinks.com. Thank you for visiting!