The need for Financial Education

Dr. Purushothaman
November 30, 2013


Not long after the start of the global financial crisis I became aware of a material difference between the so-called wealthy and the wannabe wealthy. Apart from the obvious difference in fortunes held, I have observed there is a difference in the financial education levels and approach to life.

In the years I have spent as a financial adviser I have met only a handful of people I would consider to be in the 'wealthy' group or true 'entrepreneurs'. None of them were my clients, and in fact I don't believe any of them used the services of a financial adviser.

Not only did they have an advantage in material assets but they also had a different outlook on life which encompassed enjoying a healthy life.

On the whole financial advisers do not advise these entrepreneurs because these people already understand the importance of acquiring their own knowledge, skills and information about financial education. They take responsibility for their own investment decisions and do not let others (financial advisers) make decisions for them.

There are some other key differences between these entrepreneurs and the wannabe's which I think points to why investors need financial education if they want to become a true entrepreneur.

Some of these differences are:

* Wannabe's mostly believe what they're told. Entrepreneurs will do their own research and make their own decisions. Do your own due diligence and follow your instincts. It will rarely lead you astray.

* Wannabe's will seek a perfect plan and wait for the perfect time. Entrepreneurs will accept educated risk and take action quickly once they have compiled all the information.

* Wannabe's get distracted by focusing on positive thinking without taking appropriate action. Entrepreneurs understand the importance of positive thinking but also know that it only gets you so far. They will combine positive thinking with a specific plan for action.

* Wannabe's do not share their ideas for fear of looking stupid in front of their friends or family. Entrepreneurs will openly share their ideas with like minded people. It's important to not listen to family and friends as in most cases they have no credibility. Entrepreneurs seek out financial education.

* Wannabe's generally believe they can do anything, but have no plan or falter at the first sight of a problem. Entrepreneurs on the other hand will use all available resources to put a plan into place and find solutions to wannabe's problems.

* Wannabe's are focused on 'making money' and quite often lead lifestyles with no focus on their health. Entrepreneurs are focused on combining all elements of being wealthy, healthy and wise.

Financial education is available to everyone, particularly with the aid of the internet but also through excellent courses, publications and conferences which the true entrepreneurs seek out.

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