Financial ignorance or financial intelligence?

I wrote an article on financial ignorance and it opened my mind to the impact the choice of vocabulary can have on how a message is received, interpreted and misinterpreted. My goal is to deliver the message but I also take feedback seriously and this was one great experience. Instead of focusing on the overall message in the article, some readers focused on the word ignorance. It was like an insult to be called financially ignorant or financially illiterate. Our education system looks down upon failures, upon the ignorant, and the uneducated. It looks down upon illiteracy and countries will rate themselves by how literate they are. Literacy may give a false sense of national aptitude. The economic status of a country may always tell a different story. You would expect high literacy to be associated with great economies. The case for Zimbabwe makes my point. High literacy but a poor economy. Maybe I should have encouraged readers to improve their financial intelligence. The words improve and intelligence may have received more attention than the word financial. Ignorance is far from being an insult, its just refers to uninformed citizens in a specialty but crucial discipline such as finance. It affects individuals, and it affects countries. Financially ignorant citizens can not recognize the merits and demerits of financial decisions at both a personal and national level. Finance and economic development ministers are able to make ridiculous decisions without being challenged. Prosperity gospel evangelists and marketing gurus have made fortunes by taking advantage of financial ignorance or lack of financial intelligence.

But is ignorance a bad word? It simply means lacking in knowledge in some discipline, in this case in the world of finance. It means we have a limited vocabulary which shapes our emotions. The rich have a richer vocabulary because they learn the language of finance as as well as what the rest of us learn. Most people have specialized in certain disciplines according to their carrier choices. I have learnt the language of physics but I have also expanded my vocabulary by reading far and wide across the disciplines including finance. Finance is by far the most important discipline but by far the least understood. The economy depends on it, personal finances depend on it, yet many people avoid learning the language of money, finance and the economy. 

So when I put the argument that financial ignorance was a great challenge, the responses I got were consistent of a limited vocabulary that excludes financial intelligence. Financial intelligence is limited to savings as a path to prosperity. Liabilities are mostly mistaken for assets. A great example is assuming that a house under a mortgage is an asset. Try missing mortgage payments to find out who owns the house. The mortgage lender has made an investment by paying cash for your house. You owe the bank that's why they keep the title deeds. Most people believe that the path to a fulfilling life is to study hard, find a great job, work all your life and save up for retirement. Wrong. Works for some people but it can be a gamble that most people are not aware of. Most people think they are investing when they're merely gambling using an investment vehicle. The industrial revolution introduced the concept of jobs. Scientific innovation and discovery made mass production of goods a reality. As time has moved on, the Information Age has made wealth creation largely independent of actual jobs. Machines have taken over much of algorithmic processes which can be converted into computer code and assigned to a computer. The production workers are replaced by one human being with the on and off button. 

Financial ignorance or lack of financial intelligence among others has led to the many misunderstandings in debates as people debate from a position of ignorance due to lack of the correct vocabulary. The Industrial Revolution and the Prussian education model was designed to produce mechanical special practice individuals who are good for only one thing: work for the owners of wealth. Start reading!