From our piggy bank in our room to our credit card statements, we are never far from the topic of money. It provides us food and things to allow us to live comfortably. We use it as a measure of our reward for hard work and sometimes, sadly, as a measure of who we are.
Money is a great example to see how many different types of knowledge there can be for one topic.We grow up believing we either know something or we don’t.
Can you see the differences in knowledge with respect to money that I list below?
1) How to obtain it. For someone who is industrious, this comes easy. For those with a knack of selling, it becomes a challenge. For others who are smart, years of schooling to specialize in a difficult subject makes it easier to obtain.
2) How to manage it. We all have used our credit cards to spend more than we have. The savers in the group would argue that they know how to manage money because they don’t spend it. Others would spend and save by managing the balance of what they have versus what they need versus what they want.
3) How to use it. The quick answer is that we all know how to use it. We do it everyday when we go to the store. But what I am referring to here is how to use it so that it grows on its own. Where to invest? When to refinance? When to switch credit cards because the rates got too high? When to buy a stock? House? Option? When to spend it where it looks like it is excessive but the return on the spending is remarkable (think advertising for a product that sells)?
4) How to record it. This is the domain of accountants. Of balancing our checkbooks. Of figuring out our net worth.
5) When to enjoy it. Whether foolishly or planned.
Having knowledge about money takes so many different forms. Most things in life do. This is never obvious to us with respect to any topic or domain. Think of money the next time you say “I know” about anything to be reminded that there probably are different types of knowledge about a topic that you aren’t even aware of.