Smart Earnings vs Money Wisdom

Shaan Puri shares his perspective on the distinction between being smart and being wise, particularly in the context of financial decision-making and life choices. He emphasizes that many successful people are intelligent but lack wisdom in their decision-making.

Key Points:

• Smart vs. Wise Decision Making:

  • Intelligence doesn't guarantee good judgment
  • Wisdom or good judgment is in short supply and highly valuable
  • Being wise is more important than being smart

• The Power of Good Judgment:

  • Don't need to be the hardest worker or smartest person
  • Good judgment acts as a lever in life
  • Poor judgment can't be overcome with hard work or intelligence

• Real-World Example:

  • Friend with significant wealth wanted to focus on finding a partner and starting a family
  • Instead, started 4 new companies simultaneously
  • Shows intelligence (capable of running multiple companies) but lacks wisdom in prioritization

• Personal Application:

  • Canceled workout despite fitness being #1 priority
  • Recognized this as unwise decision-making
  • Shows how even when aware of priorities, can make poor judgments

• Earning Power vs. Wisdom:

  • Many young successful people have higher income than most their age
  • Their earning power often exceeds their "wisdom power"
  • Money-making ability doesn't automatically translate to wise decision-making

• Impact of Poor Judgment:

  • Can lead to misaligned priorities
  • Results in actions contradicting stated goals
  • Creates disconnect between intentions and behavior