How to Really Empower Women
Why financial intelligence is the key to female strength
Yesterday we celebrated International Women's Day. All over the world, people came together to celebrate and honor the contributions women make to all areas of society.
My favorite part about the day was reading about the newest addition to the bull statue on Wall Street. Overnight, a bronze statue of a young girl appeared opposite the bull. Her face and posture are confident and strong as she stares down the raging bull.
The statue, named "Fearless Girl", was installed by State Street Global Advisors, as part of their efforts to increase the number of women on corporate boards. The statue's creator was quoted saying, "The whole project is about girl power. I love that phrase, because it makes us a lot stronger if we are in unison."
"Fearless Girl" means many things to many people, but to me it's an important symbol of female strength in the face of the often-intimidating financial world.
For over two decades, I've been in the business of helping women find the tools and inspiration to lift themselves out of their present circumstances and achieve great things. From day one, I've believed that the best way to encourage female strength and independence is by helping them increase their financial IQ
If we all could be like "Fearless Girl", standing proud and confident as we stare down our fears and challenges when it comes to money, then I have no doubt that the world would become a much better, more united place.
All it takes for us to get there is finding our courage, and building up our confidence in ourselves.
Control your money
Female empowerment encompasses many different things, but for me it all hinges on a basic and total control of your finances. When women are in control of their money, they have the freedom and power to make their own decisions, without anything or anyone standing in their way.
Many women are held back from controlling their money, for many reasons. I often hear women complaining that they can't invest because their husband won't let them. I am always astounded when I hear this, wondering how women ever got into the situation where they had to ask their spouse's permission to pursue financial freedom.
Other women who earn their own money believe that they don't make enough to begin their financial journey. But as Robert and I have said time and time again, it's not a lack of money that holds people back, it's a lack of education.
With a greater financial IQ, and understanding of how money works, women everywhere could discover their own path to financial freedom. If women claimed this knowledge and strength for themselves, the gender pay gap would disappear completely.
What is financial IQ?
Financial intelligence, or financial IQ, is made up of knowledge from four broad areas of expertise:
Accounting is financial literacy or the ability to read numbers. It's fundamental to understanding every facet of your finances. Without the ability to read and understand financial statements, assess your income and liability statements, and identify strengths and weaknesses, you will have no hope of being in control of your money.
Investing is the science of "money making money." This involves understanding the different asset classes and learning everything you can about the different types of investing. Once you know how to grow your money through investing, you will be on the path to financial freedom.
3. Understanding markets
Understanding markets is the science of supply and demand. You need to know the technical aspects of the market, which are emotion-driven, in addition to the fundamental or economic aspects of an investment. Does an investment make sense or does it not make sense based on current market conditions?
4. The law
A person who understands the tax advantages and protections provided by a corporation can get rich so much faster than someone who is an employee or a small-business sole proprietor. It's like the difference between someone walking and someone flying. The difference is profound when it comes to long-term wealth.
Increase your IQ
Unfortunately, the things that make up financial IQ, are the very things that send many women running in the opposite direction. We often fear what we don't understand, and for women who weren't taught about finances in school, skated by in life until they got married and then allowed their spouses to control the money, these four areas are terrifyingly foreign.
But in the end, knowledge is power, and the first step to controlling your finances is being able to understand them. You will never be truly free and independent until you are able to confidently understand and wield your money.
All it takes is determination and education. Like "Fearless Girl", you can stare down your fear and find your power.
Begin by studying and learning about the four different areas of financial IQ. Increase your financial literacy using our Rich Dad Glossary. Learn the language of money and start applying it by examining financial statements. Don't be afraid of numbers; conquer them, and learn to read the story they tell.
Next, learn about the different investment classes. Find one you're interested and learn everything you can about it. Take classes, read books, find a mentor who has successfully invested in the same assets you are interested in. Little by little, build your knowledge until you are ready to invest.
Begin following the markets. Keep up to date with new developments. Study the way they change based on global events and emotions. Find how they impact your investment class of choice.
Finally, meet with a lawyer who specializes in tax codes and take them to lunch. Make sure you find a knowledgeable and honest lawyer you can trust who can teach you how the rich legally use tax codes and corporations to their advantage.
All of these are small steps that, when combined, make great strides towards independence and financial freedom.
Support the women in your life
Support the women in your life today by encouraging them to take the steps towards financial freedom. No matter your age, career, or financial situation, every woman has the ability to improve her financial situation. We are stronger together, and by helping one woman find her strength, we all find our power.