The BIGG Successs Show
Does It Pay To Be Smart?
What your IQ says about how rich you’ll be. Listen & read here.
Welcome to our 40th big success show today. We ask the question does it pay to be smart? The big success show with George and Mary Lynn There's an interesting study that came out a while back that talks about what your IQ has to do with your level of income and your level of wealth It was published in the journal intelligence and the study was done by Jay Zogorski who's an economist at Ohio State University How smart is he? I think pretty smart. We'll see in a second when we find out his answer, right? Well, the thing is he measured the income and wealth of people and then sorted that by their IQ I guess one point we should know because we'll come back to this in a little bit The study focused on people 40 to 47 years old and so we've asked the question does it pay to be smart and After reviewing this study, here's the answer. Yes, and no Well, then I guess mr. Zogorski's not so smart. He couldn't even come up with the answer So, okay, so why do we have this yes and no? What's going on? Well, what the study confirmed was what previous studies had shown and that was that higher IQ does tend to lead to higher income So what we wonder though is is that a function of the IQ or is it a function of education? And the study doesn't talk about that right because as we know more education tends to generate higher income But here's where it gets interesting George the study also shows that people with lower IQs are just as wealthy perhaps Even more than people with these high IQs. By the way, marylandi, you know that in my last birthday my age passed my IQ Oh, did it? Congratulations Well, the thing is so if we define Does it pay to be smart if we define that pay as wealth then it appears from Zogorski study that the answer is no So that's the no side now. He defines wealth as assets minus liabilities net worth in other words it's what we own compared to what we owe and The interesting thing is that few people with lower IQs below the average had high incomes However a relatively large number of them had a high net worth So it turns out that people with higher IQs according to the study were more likely to have trouble paying their bills Having maxed out credit cards even declaring bankruptcy then people with the lower IQs matter of fact if you look at a table It shows that the people with the very highest IQs were the had the most problem in all of those areas Which is interesting. Yeah, it's kind of my mom would always say smart people Sometimes they've got book smarts, but not necessarily common sense smarts right there could be some of that going on here Well Zogorski has some theories as to why this might be one is that Perhaps people who are smarter are so confident in their ability to earn more that they're willing to spend more Oh, yeah, because they're so brainy and they know they can generate money if they need it So they can take more risk well and we have a theory when you look at this age group And this is why I said we'd come back to this later 40 to 47 year olds You think about it in many cases these people may have you know, they've gone to college They've worked their way through college and then continued on in college that perpetual student kind of thing correct And so, you know, maybe you're an even PhD's or some advanced degree So isn't it possible that all the time that they spent on education while the lower IQ people were out there actually working his kind of Impacting this and as time goes by it may be that the higher IQ people catch up and surpass lower IQ's That's a possibility. Yeah, because what comes along with higher education are those bills. Yeah And so that's gonna panel student loans, right? That's gonna hit him too. So coming up the real secret that we've uncovered in this study The real secret that comes from this study the secret to accumulating wealth is simply this spend less than what you make It's so simple, but yet it can be so difficult because we are human and Smarter not we're all subject to that human trait that makes us spend as much as we make Yeah, we we want that flat-screen TV or we want that new hot computer So spend as much as we make maybe even a little more and you know like the richest man in Babylon great book Which we did a big book review on and we've got a link to that article today on our blog at big success calm Definitely a book that should be in your library and the first secret to accumulating wealth according to the book is this a part of all You earn should be yours to keep if you don't spend it you'll always have it and you'll have more because your money Makes money for you and people with lower IQ seem to do a better job of doing just that according to this study You can get a written summary of today's show on our blog at big success calm and let us know what you think What do you think people with lower IQs do a better job of managing their money? What money management tips do you have share your thoughts and ideas with us at big success calm? We'd love to hear from you and let's get our big quote for the day our big quote today comes from Ben Franklin who said Penny saved is a penny earned. Hmm. We've all heard that one. Yep It's smart to save money because being smart with your money is money in the bank And next show we'll talk about your own personal Swat analysis your strengths weaknesses opportunities and threats and this is a follow-up to two shows we did earlier on Visualizing the life you want and living your dream with purpose Oh and a reminder the big goal setting workbook an easy six-step program to help you achieve those goals this year is Available at big success calm. I can tell you I'm using it Well and the best part Mary Lynn is you don't have to have a low IQ or a high IQ to use it because It's free And until then here's to your big success the big success show at B I G G success calm You You you you [BLANK_AUDIO]