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If you are reading this, then you are obviously interested in what the most important financial skills are and want to know how to acquire them.

Well, never fear! I have written down my top choices. I have listed why I believe they are important and how you can start using them to propel you to success!

There are some simple rule of thumb that come to mind, but they are so simple that I think they are overlooked and taken for granted.

Making money is simple, people are complicated.

With that, here is my top 5 financial skills list…

1. Money Management

This should go without saying, but the way we manage money can differ from person to person.

I was personally brought up with T. Harv Eker’s money management system that he talks about in his courses and books.

I also use a budgeting system that tracks my transactions, separates categories for my money, and has great back-end tutorials. This wonder of a resource is called, Mvelopes.com

If you have never used them, you are missing out big time! They are my favorite money managing tool and have forever impacted my life for the better!

Plus, sign up now and they will give you 30 days free to try them!

I can’t stress this enough. Money management is easily the most important thing to learn financially and can be the root cause of success or failure in any business or financial venture.

What good is getting 10,000 dollars if I don’t manage or handle it any better than I do with 1,000 or even 100 dollars?

The real value of someone financially eventually comes down to how well they manage their money, not how much they make.

2. Credit Card Management

Don’t get me wrong, I have a credit card and will most likely get another down the road, but the main reason I got one was so that I could build my credit score, not so that I could start getting in unnecessary debt.

This is what most people don’t realize about credit cards, that it is based on your “credibility” to pay back the mini-loan that you took out to make a purchase.

Credit cards can be very useful for business and many investors use them to finance their deals. They are easy to apply for and if you setup auto payments online, many of them are very easy to pay back or keep track of their transactions.

The reason I place credit cards on this list is because too many people fall back on them and don’t realize that they are going into debt rapidly.

I don’t advocate getting a credit card if you have a tough time paying back money or intend to use them as a substitute for a regular debit card or cash.

Credit cards should not be used lightly, however, they can be great tools and very good to have in hard times… as long as I know what I’m getting into.

3. Asset Vs. Liability

The key to success is knowing the difference between an asset and a liability. I don’t care who you are, what your background is like or what you believe; if you don’t know what brings you financial freedom and what takes it from you, you will never be truly successful financially.

Robert Kiyosaki’s Rich Dad Poor Dad is an exceptional way to lay a strong foundation for your financial knowledge, and much of this concept is due to his written works.

He talks about how knowing what puts money into our pockets vs. what takes money out, and what we need in today’s society vs. what we think we need today, are absolutely key in becoming financially free.

This may seem overly apparent, but if you have never read about the differences between these two things, this will seem very foreign to you, if not downright stupid!

The idea that a car, a house, or your cell phone are not assets, but are in fact liabilities, will completely re-shape the way you look at anything in your possession.

4. The Cashflow Quadrants

This is also an idea Robert came up with in his book The Cashflow Quadrant, and boy what a stellar book it is!

The next book after Rich Dad Poor Dad, it compares each working class, their strength’s weaknesses, and why the right side of the quadrant is better than the left to achieve financial freedom.

The reason I believe that everyone needs to understand the Cashflow quadrant is because all too many people have absolutely no clue when it comes to investing, being a business owner, self-employed work, and how these compare to being an “E” employee.

When I first saw this diagram, I became incredibly engrossed with financial freedom and what that meant, I think many people found me odd as I grew up because no one my age was talking about these ideas. (I learned these concepts at age 12 or so)

Understanding that simply being a doctor who makes a lot of money, but pays a ton in taxes and loses any revenue when he is no longer practicing, impacted me greatly, and that is just one example!

5. Mindset

While I am sure some would argue that this not a “skill”, but if I have read anything about mindset, I have learned that holding a good mindset is a daily habit and practice. It is something that can be learned, but it is not something that comes naturally.

I’ve said it before and I will say it again, read T. Harv Eker’s Millionaire Mindset book, you need a book like this to help you overcome those internal blocks that so easily trap us in negativity and passivity while opportunities pass us by.

The reason I listed this is because without proper mindset, any tool, business, or investment we use can end in ruin not from external circumstances, but from our own self-doubt and self-sabotage!

There is a saying, it goes something like:

“Your greatest opponent is yourself.”

This is only true if I understand and believe that I am powerful, limitless, and that I have the ability to do anything I choose.

With that in mind, who can stop me?

Well, I can. I have the ability to not do something, and wreck anything. Are there consequences? You bet.

Let me know in the comments below with any questions, and I will get back to you asap!

Best regards,

Jacob Highley

Jacob@financialsuccessbook.com

  1. You make very good points in establishing a good relationship with money and what to keep in mind when developing your financial skills. Thanks for a succinct and helpful post.

  2. That’s a solid list of skills of money management for anyone to have to day. I especially liked where yo stated, “The real value of someone financially eventually comes down to how well they manage their money, not how much they make.” This such a true statement. I mean just like you said if you can’t handle a hundred dollars. How the heck could you handle $10,000. Your in depth look into what it takes to be finically responsible today is impressive.

    • Thanks, Sean, I am a strong advocate of money management. If there was anything that I thought was the most important to have today, that would be it. There are many amazing books that have helped me greatly, and to be honest, I think I take this information for granted sometimes since I was brought up with it, so I’m glad that this was useful for you.

  3. Hey, this is very interesting and something I can’t read enough about.

    Too often people give them selfs up into a situation where they can not make real money. They don’t believe in the possibility and then they don’t invest in their skills.

    I believe the knowledge, including the mindset, is the greatest asset we can have. Once we realize learning is living and money is the fertilizer that powers us getting more knowledge we should understand that money making is normal and moral too.

    After that the road is open and we can use the skills we learn to make more money.

  4. Great post!
    You definitely hit the nail on the head, people need to understand investments. Making money is one part of it, but understanding how to leverage tax breaks and how to make money work for you is super important.

    thanks for sharing!
    Looking forward to more on investment!

  5. Hi Jacob, Am so impressed that one so young could be so knowledgeable about finance and after reading your bio can see you have had a wonderful upbringing. Learning not only from you very wise parents but going on to read all these great books which really help one to understand how to handle money wisely. To take control of what you have and not let it control you. This was a well written and thought out post and I would recommend everyone to read it. Best wishes for you future, Jill

    • Thanks, Jill! I credit much to my parents. If it weren’t for them, I would have given up on my pursuit for financial freedom a long time ago.
      It is always encouraging to know that someone was inspired by my story, it means a lot to know that what I write is helping people in some way!

  6. This article reminded me to look for that Millionaire Mindset book which was given to me as a gift by a very good friend and advisor. I started reading it but never got the chance to finish for some excuses, lol. I’m also a book reader and have read those two books of Mr. Robert Kiyosaki as well. With advanced technologies and increase exposure in social media, it’s not that easy to actually discipline one’s self in managing their income. I agree with you, no matter how much or less you make, the key is in managing your expenses. This is one of the reasons why I have been curious about minimalism. Anyways, aside from positivity blogs, sites about success and financial tips are my favorites. Thanks for this. Great article!

    • As my dad would say, “When is now a good time to start doing what you should be doing?” Of course my reply was always, “Now”.
      It is never to late to start moving forward and correct and continue. There are some great quotes from individuals who pressed on and overcame unbelievable odds. Check out my post Here, to read about them. Regards.

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