Money is not something you master just because you are a human. Nor because you have interacted with it every single day. You master money only if you choose to learn how to do it.

And although the extreme poverty level has dramatically decreased over the past decades, all over the world, people still don’t know how to deal with this tool called money.

Generally speaking, people are not (that) poor anymore. But are they happy with their financial level? The usual answer is no, this is why I believe getting some financial education is super important.

This article is about 8 things that I consider super important in improving everyone’s financial life. Some of them are notes that you have to deeply understand in order to evolve. Some are just scratching the surface of subjects that you should approach more in depth. Let’s dive in.

1// Formal education doesn’t teach you about money.

During the school years, you are told to study and be the best. This continues with getting a good job, marrying and living life. Don’t you think there is something missing from this equation? Well, in my opinion, there is a problem: nobody teaches you how money works.

More than that, we live in a very old formal education system. As long as there is an accounting college around you, please be sure to doubt the system.

So, basically, the school prepares you (somehow) to live in a financial world that you know nothing about.

• You know that it is run by money, but how does this money work?
• And how should you personally manage this money?
• Are there rules that govern the money?

Well, there are rules that money follow and there are recipes for managing personal finances. You have to understand what you already know and how you can improve your relationship with money.

2// About money, you are taught at home.

Children learn from their parents what money is and how it works. At dinner, in the warm atmosphere of their house, everyone gets the basics of the economic world.

Do you think that is not applicable to you? Then think about how many discussions about the money you have heard during your childhood. From financial strengths to things that must be paid, to the cost of a vacation/new car/new home or just regular expenses. Never-ever?

If you have never heard talks about money, then you are a complete whiteboard, so start your learning process. But if you have participated to these types of talks, then welcome to the club! The club of people that have to analyzee the quality of their financial education from home.

If you learn that money are bad, you have to forget this rule. If your parents fear money, you have to overcome this fear. And if you lived in a financially limited context, you can certainly become as wealthy as you want.

Before answering the question how, let’s understand another concept: 👇

3// The rich get richer, the poor get poorer.

When I first heard that, I got really angry. I was a child and I wanted an equilibrium: people that needed money should get it and those that didn’t should step aside.

Of course, things are completely different in life. And this difference does not come from a universal voodoo law, but from a simple rule. Your wealth depends on the financial education you have.

I have met people that earn $10,000/month and they are full of debts. For me, these persons are not rich. But they have a big potential to become poor.

Rich people have a certain mindset, understand the rules of money and base their actions on these rules. Poor people don’t care about financial education. Usually, the biggest mistakes they make is the way they spend their money.

This brings us to the next point.

4// Your mindset builds your relationship with money.

If you are afraid of money, then you will run away from them. If you think money is bad, you won’t focus on making money.

But if you believe money is just a tool for you to evolve and meet the results you wish for, then you are very probable to create a healthy source of income while not making a purpose out of it.

Have you heard that “money doesn’t bring happiness”? Well, certainly it does not guarantee it. On the other hand, the lack of money does guarantee frustration. But if you think that money is evil or it will destroy your life, then you won’t search for ways to get rich.

It all starts in your mind.

If you want to become wealthy (you name what stream of income you need), then remember that​ it all starts in your mind. If you see money as a tool with rules, then there is nothing more. Follow the rules and get the income that you want.

5// Design your life based on your passions.

This is one of the biggest misconceptions​ nowadays​ from my point of view. I mean, we all dream about living out of our passions, but they're​ so little the ones that actually succeed.

And that success is not about luck, believe me.

That success is about the money rules. Once you understand a financial flow, then you can make money in literally any area. The reverse is also true: you can be in the best niche ever, as long as you don’t know how money works, you will have to get a second job.

So, think about your passion and practice it. The same time, analyze how you can make a source of income out of it, what is the flow of the money (both in general and specific for your passion). And, most important, don’t give up with the first obstacle!

Anyone, from wherever, can build an awesome lifestyle based on his passions! The idea is to educate yourself (continuously) and to be perseverent. You will find obstacles and most of them will come from your limiting beliefs. Move on, always on! And don’t give up.

At the end of the road, you will smile and thank yourself from the past for getting over the struggles.

6// The same external thing is for some an excuse and for others a motivation.

Let me give you an example. Most of the people around me have debts. And I could often hear this idea: I cannot save money because I have debts.

On the other hand, there were people saying: “I have debts, I need to save money for an emergency fund and to pay off my debts as soon as possible”.

The difference between these 2 types of people is huge in my opinion. You can see 2 completely different attitudes. As you can imagine, these different attitudes bring different results.

But the main idea here is that it is your choice the way you design your life. A problem (having debts) can either empower you to solve it, either be used as an excuse not to achieve something.

In my opinion, even having an emergency fund that is independent of the debts is a useful solution. Because the unpredictable can come into your life, no matter if you have debts or not. And having an emergency fund will save you time and, most of all, stress.

7// Financial education is not about the amount you earn, but how you manage the money.

This is, probably, one of the biggest and most important personal finance ideas that you should understand. I have mentioned before the guy with $10,000/month income that was unable to pay off his debts.

The amount of money you earn has nothing to do with financial freedom.

Ok, it has a little to do, but it is not that important.

Your lifestyle and the way you manage your income is what actually makes you rich or poor.

Spending all you earn in a month is not an option.

Big and long-term debts are not an option.

Saving with no vision is not an option.

Working harder is not (always) an option.

What are the options? Long story short: make plans for your income and spendings. If you want to see an example check rule number #4 from this list.

8// Invest in yourself.

I cannot say it enough: continuous education is a key in life and money makes no exception from this rule. You won’t finish learning​ everything in a lifetime. But this is not a reason not to start it.

Money comes and goes, but education is yours to master. Your financial education is what actually makes money come and stay or run away. Of course, there is also your mindset, but once you get educated, your mindset aligns to your new knowledge.

Always keep in mind that you and your mind are your biggest assets. In order to support that, I will tell you the definition of financial freedom that I could find while learning about the area.

financial freedom = the ability to make money from scratch if your life completely changes tomorrow.

Final Thoughts

This is one first sum up article regarding personal finance tips. Over time I could find many interesting ideas that have changed my mindset related to money.

If I were to choose 2 main things that you should take into consideration to improve your life related to your finances that is:

• build a healthy mindset regarding money;
• learn to correctly manage your income and find great solutions to any problems.