Maybe the question should be, “Why isn’t every single smart person rich”?
The simple answer might be that some people do not want to be rich. Money isn’t everything. Some people choose careers that are not lucrative, such as teachers, researchers, scientists or people who choose to dedicate their life’s work to a religious organization. Different people have different priorities.
Just so we’re all on the same page, let’s look at the definitions of smart and rich.
Smart – adjective \ˈsmärt\ : very good at learning or thinking about things, knowledgeable, showing intelligence or good judgment
Rich – adjective \ˈrich\ : having abundant possessions and especially material wealth
Success is More a Function of Effort than an Idea
Not taking that leap of faith, because of the inherent risk of the unknown, is too much for some people to handle. There is a blind leap required to believe you will get to the other side that simply baffles many very smart people. You also have to consider that the “smart” person knows too much, always takes the safe road or path of least resistance to appease the fear and possibility of failure. This alone hinders their ability to become rich. Many others simply lack the business skills or intellect needed. Taking risks and being outside the comfort zone is a trait of many self-made, rich people.
IQ isn’t everything. Intelligence does not equal ambition, vision or ones inherent ability to see the endgame – having abundant possessions and especially material wealth, i.e. being very rich. IQ has no relation to wealth. You also need to consider EQ (emotional quotient). While both IQ and EQ are related, they are also opposite in their view of mental ability. Whereas IQ sees intelligence as being a single measurable characteristic affecting all mental ability, EQ breaks mental ability down into many different characteristics which include the ability to evaluate, identify, express and control emotions, one’s own emotions; perceive and assess others’ emotions; use emotions to facilitate thinking and understand emotional meanings.
Luck or Lack Thereof
Some extremely dumb people are very rich and it just happens to be based on luck. Winning the lottery, inheriting money, being born into a rich family or marrying into money are all easy ways to be or become very rich. What does it mean to be extremely lucky? I would define luck as; success or failure apparently brought by chance rather than through one’s own actions. So can being in the right place, at the right time or having the right idea and knowing the right people assist you in becoming rich?
Thinkers vs. Doers
Coming up with a good or great idea isn’t difficult – Implementing it and seeing it through to fruition is the difficult part. Being pragmatic and hands-on is a mandatory prerequisite which most rich entrepreneurs possess. Simply theorizing and not taking action is a likely rationale in understanding why the majority of very smart people are not rich. Being self-disciplined and not seeking instant gratification is also a trait of most self-made, rich entrepreneurs. Hard work and a never ending need to achieve success is an ingrained, burning desire of most smart, rich people. Individuals who are both smart and rich think differently than most and have their priorities organized differently than the majority of people who are simply smart. Creating wealth isn’t easy, even for smart people. Simply creating value doesn’t mean that you can capture or save any of it. All smart people have different driving motivations and some of these motivations conflict with wealth creation goals.
Besides a slew of other reason why all smart people aren’t rich, including but not limited to; lack of motivation, passion, poor social skills, emotional instability, the right opportunities, need or desire, not having a trusted network of advisers or mentors, you should also consider that the brightest and richest people realize that being rich isn’t a high priority, so they focus their time and energies on things which are more important to them.
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