Why don't smart people become rich?

Martijn Sjoorda

Process Designer, Facilitator, Corporate Shrink

232w ago

I am smart, by other people's standards. I am not rich in monetary terms. I do manage to live well.

The reason I am not rich is because so far, I have not been interested enough in  money itself to focus on it or allocate my smarts to that area. I do see that now that I am turning 44, who I am, what I stand for and what I have to offer to other people are starting to converge in such a way that I might end up rich after all. It would, however, be a consequence of something, not because I set my self the objective of becoming rich.

Rich people get rich because they set out be just that: rich.

I suspect that if you asked smart people why they aren't rich, they'd give you a similar answer. They simply don't care about money too much. They care about what they do and stand for and follow a passion. Those variables aren't usually the best framework for becoming rich. Unless they truly align in a particular way, in which case they end up rich.

I'll illustrate with an example: I was just asked to write an article for a leading magazine. If I chose topic A, I can make an abstract of the book I just finished writing and the phone would probably start ringing for business. If I choose topic B, I know I will produce fresh thinking and integrate two fields that haven't been connected before.

Much more interesting intellectually, zero (immediate) impact on my bank account. Oh well...

Siddhartha Bhattacharjee

Executive Coach and Leadership Consultant at C2CLEADERSHIP (2014-present)

28w ago

Does absence of smartness predict wealth accumulation ? Cant think of any example as yet.

Smartness is often understood as being agile- like first mover, manipulative- can reframe, engaging communicator - persuasive and a note worthy presence. They are intelligent - can generate ideas, solve problems, synthesise information with relative ease.

Now , the question - can intelligence and noteworthy presence predict richness. The answer is not always. One of the key determinants is exchange of value that others are willing to trade with theit money. At the core of this exchange lies - conversion of one situation to another that is better than the previous - e.g bad to good, good to better, discomfort to comfort , dark present to bright future, difficult situation to easy and more. You will note, that this more of a emotional transformation and not cognitive enhancement. Any smart person who can create emotional appeal to by solving problem , creating hope of betterment would end up sowing the seeds of successful business. Not all smart people enjoy emotional intelligence - an essential pre requisite for business success in modern times of high turbulence. Most successful smart businessmen besides being smart are also emotionally appealing. If emotional intelligence is missing - they may end up being labelled as great scientists, lawyers , doctors and engineers with high cognitive skills and domain expertise.

Hope this ansers.

Julie Gurner

I've advised startup companies, and high net worth clients.

112w ago

Many "smart" people do not acquire wealth for a few reasons:

1. They often are funneled into careers that have ceilings in what they can earn. For example: Many people believe that if you're smart you become a doctor or attorney (or other such career). People who stick in these fields traditionally might be comfortable, but they'll never be truly rich - and many will have massive loans.

By contrast, a person who doesn't go to college or just goes to some college has a lot more time and has no constraint on what they can earn.

2. Smart people are more likely to be a "wage slave." That is, they are often channeled into upper education, and high education often comes with a price....debt. Once they graduate, they are more likely to want stable jobs that can pay down that debt. While they can earn a lot...it's nothing compared with what a successful entrepreneur can make.

3. Because "smart people" are channeled into high education settings, they begin their careers later...and are less likely to take big risks.

....but saying all of this, I think that we'll see many of these factors changing as intelligent people value their time more, and technology becomes more prominent.

For example, we'll see less smart people choosing to become physicians and more choosing something like computer science. While both can earn a significant living...a computer scientist also has the potential to work from home, have stakes in entrepreneurial ventures, and less educational commitment for a significant income.

Dan Kanivas

compound interest rules everything around me

111w ago

Because some smart people don't pay attention to the Micawber Principle:

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery."