Most people want to move up the career ladder, and most of them want to do that to earn more money. But do people who are high up in their careers know their way around money? It may be possible that top executives still turn to private money lenders to take out loans occasionally.
So, is career advancement connected to financial literacy? Let’s find out.
What is financial literacy?
When can you say you are financially literate? In a nutshell, you have achieved financial literacy when you can make wise choices with your money. This means that you know how to designate each dollar you earn for useful purposes, including wealth building.
If you are financially literate, you know the value of having an emergency fund and savings. Also, you know how to use investing to grow your money over time. More importantly, you know which investments sound and which ones are scammy.
Ultimately, if you are financially literate, you are on track to achieving financial freedom. In other words, you will have little to no worries about money. Whenever a need arises, you will always have the money for it. Also, you will have the money to spend on some of the things you want, like holidays abroad or your own home.
But the question remains. Is financial literacy connected to career advancement? The answer goes both ways.
Yes: If you are financially literate, you will make better career choices
Financial literacy can lead to more sound decisions in your career. For instance, if you have financial goals, you can steer your career path toward achieving those goals.
Also, as you advance in your career, you will remain wise with your money. You will not be vulnerable to money-draining practices like lifestyle inflation. Instead, you will use your higher income to fulfill your financial goals faster.
Part of financial literacy is making wise borrowing decisions. Here, you choose to take on good debts and avoid bad ones. Bad debts are those that help you acquire liabilities, like cars or other expensive things. These things do not earn you money once purchased. Good debts, on the other hand, help you acquire assets. These are things that earn you money once they are purchased and continue to earn money long after. When you use loans to purchase assets, the income from it can easily pay off the loan.
If you are financially literate and in an advanced stage in your career, you become an asset to your company as well. Most likely, you will be tasked to make decisions involving company finances. Because you know how to deal with money wisely, you can always make decisions that will benefit the company financially.
No: Some people who are advanced in their careers are not financially savvy
Unfortunately, not everyone who ranks highly in their careers is financially literate. It is possible to be a top executive in a reputable MNC yet have a lifestyle that invites financial trouble.
For instance, if you are a CEO but use most of your salary to buy expensive cars, jewelry, clothes, and expensive trips out of the country, you are not practicing financial literacy. You may be earning a lot of money, but your lavish lifestyle will drain your finances quickly.
In this regard, career advancement is not a guarantee of financial literacy. It is better to develop financial literacy first, and then move up the career ladder as you go along. This way, you can make sure that you live a financially sound life not just in the present, but also in the future.
Conclusion
Career advancement may or may not be connected to financial literacy, depending on whom you ask. But if you have financial goals to achieve, it is always better to develop financial literacy first before advancing in your career. At first, you may need the help of lenders like 111 Credit to get ahead, but later on, you will be able to achieve career advancement that will benefit your financial life.
