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Millionaires Focus on Freedom
By JLP | October 29, 2007
The title of this post is also the title of an article I just read on Yahoo! Finance (originally from Bankrate.com). A quote from author Keith Cameron Smith really struck a chord with me, and I want to share it with you:
The very poor and the poor are stuck in survival mode; they just want to survive. The primary goal of middle-class people is comfort; I just want to have enough; I just want to be comfortable. When you get into the rich and the very rich, their primary goal is freedom; I’m going to do whatever it takes to experience freedom. That’s the biggest difference.
It’s OK to have a plan for survival, it’s OK to have a plan for comfort, but just make sure that most of your mental energy is focused on freedom. Then you’ll start experientially understanding the old saying, “Seek and you will find.” If you seek to survive, you will. If you seek to be comfortable, you will be. But if you seek freedom, you will find it. It just takes longer to create freedom in your life than it does to create survival. Does it take longer to grow a weed or an oak tree? Financial freedom is like an oak tree, where survival or comfort is like growing a weed or a little bush; it doesn’t take too long.
This is a very interesting and important consideration. I agree that the poor are focused solely on survival and that the middle class is focused on comfort and a basic sense of security (“sense of” being the operative phrase). I also agree that those mindsets inherently limit financial and career potential of those people, as a group.
However, I’m not sure that all (or even most) of the poor and middle class can acheive financial freedom simply by “seeking” it. I strongly believe in individual responsibility and the American Dream, but the fact is that many people from those classes lack the education (formal or otherwise) and the ability to become a successful entrepreneur, which the article implies is really the only way to become financially free. Many also do not have the academic preparation, resources, or motivation to go to college, after which they could arguably obtain a decent-paying job.
Financial planners and “experts” love to look at people as individuals in a vaccuum. “Get educated!” “Save money!” “Start a business!” they preach, as though everyone is perfectly capable of doing such things but are somehow simply choosing not to. That advice may apply to many of us who typically read and write about finances–those who are already more or less financially comfortable. We grew up being told we can do and be anything we want. We were read to and educated constantly; we were taught how to handle and save money; we were expected to make good grades, go to college, and have a career (as opposed to a job).
It’s important to remember that millions of Americans never get that kind of education and guidance growing up. Many people never see or hear of a single positive financial role model. They are not expected or encouraged to become financially comfortable, much less “financially free.” Things like payday loans and savings jars (as opposed to accounts) are what they are used to–things like IRAs, savings bonds, and 529 plans are not even part of their vocabulary. And hearing about the tax breaks that a 401k has to offer is not going to change their reality or their financial situation. The poor and the middle class get their financial education from the same place the rich do–from friends and family. The difference is that their friends and family are more likely to be sorely mis-guided.
The point is not that there’s no hope for individuals from the poor and middle class to succeed. There are countless success stories (including all four of my grandparents). The point is that many of those people may need a different kind of financial advice and guidance. It’s not as simple as telling them to seek financial freedom.
More from Meg at The World of Wealth
Topics: Financial Planning, Getting Going, Kids and Money | 14 Comments »
October 29th, 2007 at 10:16 am
Hi – I had to write a reply to your article. While I agree that what people focus on is what they tend to achieve I disagree with the assertion that people lacking a certain education or similar training are ill-equipped to succeed in today’s world. All people really need they already possess. Everyone is the creator of their own reality. If people desire to have a better life and they focus their thoughts on living in a better way then they will begin to discover newer opportunities that will eventually propel them forward. How many stories have you heard of people that have pulled themselves up from poverty and are now living a better, richer, life? Countless. How did they do it? They simply new there was a better way and they desired to have it and they NEVER gave up. If you tend to think that your situation is hopeless then by all means it is. If you tend to see the good and what can be then the universe opens up and you begin to meet people here and there that wind up creating opportunitities that you would have otherwise missed out on. This is truly a universe that is based on feeling and emotions. If you think the glass is half empty…then it is. If you think that the glass is half full…then guess what…..you’re right too.
October 29th, 2007 at 10:43 am
“Many people never see or hear of a single positive financial role model.” simply put, imho opinion, a cop out. was thinking about this very same thing reading an article about gang violence in a nearby town yesterday – a really beautiful idyllic place – you might have heard of it – sonoma, ca. the whole gang thing is another world, of course, for those of us who read blogs like this. one can take the reasoning of the quote above to explain gang type behavior. i’ll take the other side. there are ample enough moments in one’s life to reject the poor/gang/cycle. no sympathy from me if you take the wrong path.
October 29th, 2007 at 10:43 am
“Many people never see or hear of a single positive financial role model.” simply put, imho opinion, a cop out. was thinking about this very same thing reading an article about gang violence in a nearby town yesterday – a really beautiful idyllic place – you might have heard of it – sonoma, ca. the whole gang thing is another world, of course, for those of us who read blogs like this. one can take the reasoning of the quote above to explain gang type behavior. i’ll take the other side. there are ample enough moments in one’s life to reject the poor/gang/cycle. no sympathy if you take the wrong path.
October 29th, 2007 at 10:45 am
Meg – I was going to write a post on this topic as well. I tutor kids from poor Chicago neighborhoods and see that their financial education vs the financial education of many middle to upper class people get is vastly different. Survival is definitely the game of the poor, although I would suggest that complacency is the game of the middle class.
I have to disagree with Bill, though. In tutoring those same kids, sometimes having a vision of greatness of the future isn’t enough. I’ve seen kids do all the right things, but their environment and lack of direction (financial or otherwise) works against them. What to do about those kids? One could have all of the drive in the world, but without the right direction their energy is wasted. That’s not to say I haven’t seen kids who pull themselves out – they have had to sacrifice much for their own gains.
Fantastic write up. Thanks for sharing.
October 29th, 2007 at 11:16 am
[...] Mark Thoma wrote an interesting post today onHere’s a quick excerptMany people never see or hear of a single positive financial role model. They are not expected or encouraged to become financially comfortable, much less “financially free.” Things like payday loans and savings jars (as opposed to … [...]
October 29th, 2007 at 11:27 am
[...] unknown wrote an interesting post today onHere’s a quick excerpt“Save money!” “Start a business!” they preach, as though everyone is perfectly capable of doing such things but are somehow simply choosing not to. That advice may apply to many of us who typically read and write about finances–those … [...]
October 29th, 2007 at 11:33 am
Right on!
Recently I saw an interview with Donald Trump, and even he was saying that not everyone has what it takes to be an entrepreneur, but that you can become the very best employee if you aren’t able to start a business on your own. Everyone can do something to make their situation better, and being focused on a goal is the right place to start (motivation), but ultimately, like you said, it’s all up the individual to actually follow through and act.
October 29th, 2007 at 11:46 am
[...] YouTube Millionaires Focus on Freedom » This Summary is from an article posted at ? AllFinancialMatters on Monday, October 29, 2007 This article’s contents are copywritten by the author of ? AllFinancialMatters. Please click "View Original Article…" below to view the article. Summary Provided by Technorati.comView Original Article at ? AllFinancialMatters » 10 Most Recent News Articles About Yahoo [...]
October 29th, 2007 at 1:13 pm
Personal finance is definitely personal. So it has to take into account how people are raised. You’re absolutely right to point out that some people haven’t been brought up to look at the world in a way which will help them succeed financially. A few might have innate aptitude, but others won’t.
What do you think would be the best way of educating such people? Personal financial counselors (who actually care)? Schools offering night classes?
October 29th, 2007 at 2:51 pm
I am happy to see an article such as this (first one with this message I’ve read on a pf blog and I’ve been reading them for a while). I may not agree with it point for point, but I very much like the overall theme that context is important, background is important, obstacles and circumstance and environment do make a difference, and a vision, dream and perseverance are not always enough to make a dream come true, regardless of the degree of positive thinking, hard work, etc.
Like “Him,” I have a lot of experience working with kids as well as with people with a vast range of socioeconomic (and other types of) diversity, and I have had the opportunity to learn a lot from those (and other) experiences. Additionally, looking at statistics and research on these issues has added a new level of insight into the issue as well.
I have far too much to say on the issue to be able to fit it into a comment (I have a post in the words on a similar topic) so I will just say that I think you’ve done a great job explaining your views and that you’ve made an important point here. Great post.
October 29th, 2007 at 10:43 pm
Meg-
What a phenomenal article! I argree with you wholeheartedly. Everyone is not blessed with the same abilities to assume so is very short sighted. I agree with the Donald on this one. If you don’t have the skills to be an entreprenuer, you CAN be the best employee possible.
I have also had a decent amount of exposure to individuals facing huge hurdles. It is really tough. Not impossible but tough. I think it is our responsibility as individuals to help those less fortunate learn these skills.
Nicole
October 29th, 2007 at 10:44 pm
Mrs. Micah-I thought about trying to address possible solutions and ways to educate those who start out at a distinct educational disadvantage…but the truth is that I don’t have the answers–plus my post was getting really long anyway.
I used to want to be a financial planner because I am passionate about helping those who really need help–or at least those who could really benefit from my advice. But the truth is that it’s difficult to make any money (much less to make a decent living) teaching poor people to manage their money. And that’s the problem. Though many nonprofits are doing some new things to help people and communities overcome poverty.
Recently, I found out about a local non-profit that helps the poor in my city. They really focus on integrating poor individuals into the rest of society–they teach proper grammar and etiquette, provide decent clothing for job interviews, and provide other basic training and necessities. They also coach people to think in terms of a career rather than a job–they make the individuals identify their dreams (a concept new to most of them). Say one of them, in their wildest dreams, would love to be a doctor. The nonprofit gets them a job in the cafeteria of a hospital and connects them with a mentor who is perhaps a nurse or technician in the field–someone who has also overcome poverty. Sometimes that individual is happy just having the decency of a uniform and is happy with their new “professional” job.
October 30th, 2007 at 9:07 am
[...] Read the rest of this great post here [...]
November 6th, 2007 at 11:02 pm
[...] Meg at All Financial Matters explains:Millionaires Focus on Freedom http://allfinancialmatters.com/2007/10/29/millionaires-focus-on-freedom-2/ [...]