When it comes to investing, what comes to mind of most people is where to get the best returns on their money. But while that is important, it is secondary.
There is this joke that when person with money meet someone with experience, the person with the experience ends up with the money while the person with money ends up with experience. That is a hard way to learn.
Your best investment is investing in your financial education. When you are attempting to cut a giant tree, your best investment is in sharpening the saw because blunt saw will dissipate the energy in you.
The more you invest in your financial literacy, the greater your returns. Hence, it makes sense to invest first in your financial education. Buy books on financial literacy and attend seminars that will sharpen your skills on managing finance. It will cost you a little but, in the long run, you will benefit from it when you manage your business well.
If you want to drive, it makes sense to learn how to drive first (and getting driver’s license) before getting behind the wheel. Observing others and jumping into our car may seem like a short cut but you may end up spending a lot of money repairing damages from avoidable accidents.
Hence, it’s obvious that education is cheaper than ignorance in the long run. While your accountant will help put your books in shape, it is your responsibility to manage your finance. This function cannot be outsourced, as many celebrities have learned the hard way.
Uko is author of Practical Steps to Financial Freedom & Independence and can be reached at [email protected], www.financialfreedominspiration.com
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