Poor Solutions to Money Problems

Robert Kiyosaki - International Bestselling Author

Poor Solutions to Money Problems, Learning at an early age that we all have money problems, no matter how rich or how poor we are, was a very important lesson for me. Many people believe that if they had a lot of money, their money problems would be over. LIttle do they know that having lots of money just causes even more money problems.

One of my favorite commercials is for a financial services company and starts with the rapper MC Hammer dancing with beautiful women, a Bentley and a Ferrari and a grossly oversized mansion behind him. In the background, high-end specialty goods are being moved into the mansion. MC Hammer's one-hit wonder, "U Can't Touch This", is playing as all this is happening. Then the screen goes black and displays the words "15 minutes later." The next scene is MC Hammer sitting on a curb in front of the same ridiculous mansion, his head in his hands, next to a sign that reads "FORECLOSED." The announcer says, "Life comes at you fast. We're here to help".

The world is full of MC Hammers. We all have heard of lottery winners who win millions and then are deeply in debt a few years later. Or the young professional athlete who lives in a mansion while he is playing and then lives under a bridge once his playing days are over. Or the young rock star who is a multimillionaire in his twenties and looking for a job in his thirties. (Or the rapper who is peddling financial services that he was probably already using when he lost his money.)

Money alone does not solve your money problems. That is why giving poor people money does not solve their money problems. In many cases, it only prolongs the problem and creates more poor people. Take for instance the idea of welfare. From the time of the Great Depression until 1996, the government guaranteed money to the nation's poor regardless of personal circumstance. All you had to do was qualify for the poverty requirements to receive a government check - perpetually. If you showed initiative, got a job, and earned more than the poverty requirement, the government cut off your benefits. Of course, the poor then had other costs associated with working that they didn't have before, such as uniforms, child care, transportation, etc. In many cases they ended up with less money than before they had a job, and less time. The system benefited those who were lazy and punished those who showed initiative. The system created more poor people.

Hard work doesn't solve money problems. The world is filled with hardworking people who have no money to show for it, hardworking people who earn money, yet grow deeper in debt, needing to work even harder for even more money.

Education does not solve money problems. The world is filled with highly educated poor people. They're called socialists.

A job does not solve money problems. For many people, the letters J.O.B stand for just over broke. There are millions who earn just enough to survive but cannot afford to live. Many people with jobs cannot afford their own home, adequate health care, education, or even set aside enough money for retirement.