What is financial intelligence?(Part 2)
Financial intelligence and its components
Financial intelligence is a set of skills that consists of the following four components.
- Understand the foundation
- Understanding Art
- Understand the analysis
- And understand the benefits
For the heart of financial information to be fully successful, these four competencies must be put into practice. Finance is a business language that is known and used in all organizations and is a common denominator on which all organizations are measured.
Why is financial intelligence important?
As an emerging business best practice, financial intelligence is often defined as the ability to acquire and apply knowledge and skills gained from understanding financial and accounting principles in the business world. Every decision a company makes affects its finances, so understanding the principles of accounting and intelligence behind them will improve the results.
Although financial intelligence is an acquired skill, having experience, understanding and applying it in the real world is also an invaluable asset.
A company's financial statement is used to show overall performance over a period of time. Most companies report financial statements in at least three different ways every three months.
Because financial resource management is so important given the complex structure and forms of economic exchanges and investments, the importance of financial intelligence and how to measure financial success helps companies make decisions based on the positive financial impact of these decisions. Take the necessary steps.
Thinkers have defined an independent science in this field called financial intelligence. Protecting and guiding money in the right direction is one of the solutions used to solve financial problems, which is called financial intelligence. To strengthen your financial intelligence, you must develop three abilities.
Money Making Skills: Starting a business and managing it will generate revenue.
Solving financial problems and the ability to invest: When faced with financial problems, we must be able to solve it.
Ability to invest: By identifying investment opportunities, you can use your capital.
In fact, what can help us choose the best and most appropriate ways to increase and manage money and wealth is financial intelligence.
Financial intelligence leads to seeing an opportunity that others do not. In the last crisis the world faced, the Great Depression of 2008, many people lost their wealth. In this crisis, in 2008, people with high financial intelligence took advantage of falling prices and started buying apartments at low prices.
A few years after the crisis, they sold those properties and made a lot of money. At that time, when many investors were given the opportunity to invest, they said no. They were scared and did not want to lose their money. Today, they regret these decisions.
In fact, what can help us choose the best and most appropriate ways to increase and manage money and wealth is financial intelligence.
Financial intelligence leads to seeing an opportunity that others do not. In the last crisis the world faced, the Great Depression of 2008, many people lost their wealth. In this crisis, in 2008, people with high financial intelligence took advantage of falling prices and started buying apartments at low prices.
A few years after the crisis, they sold those properties and made a lot of money. At that time, when many investors were given the opportunity to invest, they said no. They were scared and did not want to lose their money. Today, they regret these decisions.
This is what happened to many entrepreneurs in the early days of COVID. While some people were scared and did not take risks, people with high financial intelligence were finding ways to take the initiative and make money. For example, in the first few months of the epidemic, some of these people and sellers sold face masks.
In fact, they used to produce the product that everyone needs. In fact, these people, who had high financial intelligence, saw an opportunity that others did not pay attention to.
In short, in difficult situations, there are successful people who use it and see situations, while others do not. This's a big difference بالاتر Higher financial intelligence. The fact is that if you have high financial intelligence, you can see where the money is flowing and be there before others.
You get the benefits of that money by acquiring assets that increase in value and provide cash flow. Then use this money to acquire more assets in which more money is flowing.
Financial intelligence starts with simple financial training. Education is important because you have to train your brain to see money. Something that does not happen naturally. The key to training your brain to see financial literacy money is the ability to understand capitalist words and numerical systems. Financial literacy is the basis of financial intelligence. I disagree with those who say, "It takes money." In my opinion, the ability to make money with money starts with understanding the language of money.
Strategies to increase financial intelligence
Lack of financial understanding will hinder career success. Awareness of financial issues will create better conditions for the individual. Here are some strategies to improve your financial intelligence.
Overcoming Fear: Through financial performance, you can measure business progress and, consequently, capital increase. Finances are very simple, so do not be afraid of financial issues and run away from them. (For more information on the position of capital increase, you can read the article "Capital increase".)
Learning financial language: Financial issues have their own language and the most important issues that need to be mastered are profitability, EBITDA, measuring income and operating costs.
Change of thinking: When you focus on spending, your financial intelligence will not grow. By thinking about how you can make more money, you can take steps to increase your financial intelligence and make decisions that will change the way you think.
Optimal use of time: Dedicating time to doing things that lead to capital also increases financial intelligence. Take time each month to write down your finances and plan how and how much to spend.
In this article, we learned that to increase financial intelligence, it is enough to follow our financial situation and be committed to it. Regardless of how we make money, we need to know how to use it to be able to invest part of it. So if you can solve your financial problem, it means that your financial intelligence has increased.
Financial intelligence and beyond is understanding the financial concepts are the first steps to acquire financial knowledge. This factor prepares managers to take a more analytical look at financial figures and make more informed decisions.
Take the time to develop your financial literacy and you can increase your financial intelligence and make money where others do not. Financial intelligence is not just an internal skill but a set of learned skills that can be expanded.
