Why Jewish People Are Financially Stable: Unveiling the Secrets
Jewish Financial Stability
Have you ever wondered why Jewish people are so financially stable?
On average, Jews report higher household incomes than other ethnicities in America.
According to a recent study by Pew Research, 23% of Jews say they earn up to $200,000 or more. That’s one in four people. In comparison, only 4% of U.S. adults were able to claim such high levels of household income.
Jewish Household Incomes Compared to Other Ethnicities
But here’s the thing: it’s not a myth, it’s not a coincidence, and it’s not luck. There are strict financial rules hidden in the holy books that Jewish people have passed on from generation to generation right from birth for thousands of years.
And guess what?
These secrets are timeless, foolproof, and cut across businesses, social interactions, money management, and wealth. In this post, I’ll spill the beans on these secrets down to the last detail, how they cut across their daily lives, and how you can apply them using a really simple and practical blueprint.
If you want your finances to take a 180° turn, you can’t afford to miss this.
The Role of Financial Rules in Jewish Culture
There’s a common misconception that the Jews embrace righteousness and have no issues with being poor, given that money is materialistic. But that’s just way off the mark. Poverty isn’t attributed to holiness; it’s kind of like a disease that no one wants, and the rabbis saw no virtue in it.
As a matter of fact, instead of being considered virtuous and desirable, rabbis describe it as pointless suffering. It’s neither admired nor considered a positive value by the writers of the Tanakh.
Misconceptions about Poverty and Virtue
Get this: because poverty is something the Jews desperately avoid like the plague, they never fail to earn a worthy living through meaningful employment or a business, depending on the context. In Jewish law, everyone is to do everything in their power to be self-reliant and not be a burden on others.
Even when the rich give a helping hand through philanthropy or charity, the beneficiaries never consider it to be a reward for simply living. They are still expected to earn a living for themselves.
Self-Reliance and Employment in Jewish Law
Even as many Americans and Europeans struggle with credit card debt, student loans, auto loans, mortgage problems, and so much more, the Jews, despite now being scattered all over the world, still thrive in their businesses and personal finances.
But the question is, how?
How are they so effective?
Jewish Financial Success Despite Global Challenges
The idea that Jews run the financial sector and the global economy is among the oldest and most damaging anti-Semitic concepts to date. Hitler even cited it as one of the reasons to annihilate the European Jewish community.
And what about the condescending stereotypes?
Jews are often seen as being cheap and greedy, both of which are just not true.
Debunking Anti-Semitic Stereotypes
When it comes to money, many Jews, especially the religious ones, look to the Torah, which is the Old Testament Bible, for direction. It teaches them so many things like kindness, benevolence, and love for one’s community.
And the amazing thing is that it starts from childhood. Proverbs 22:7 says, “Train up a child in the way he should go, and when he is old, he will not depart from it.” It isn’t just talking about frequent lessons; it means regular practice and applying them over and over again.
The Torah’s Guidance on Financial Management
Jews train their children to be independent thinkers and self-reliant enough to make sound financial decisions. What we do is we give children Kanuka. We start educating children about money. The gift we like to give children on Kanuka is money, and we also accompany that with discussions of what money is and what it’s about.
And you have to divide your money into three: one part is for charity, one part is for you to spend on things you need, and the other part is to put away and save. So yeah, Kanuka is the money time of the year for us. It’s passing on to the next generation the principles of money that are so important.
Training Children in Financial Responsibility
They do this by using five jars, each carefully labeled: tithe, investing, savings, charity, and spending. Think of this as the piggy bank you likely have at home already, but with greater purpose.
The Five-Jar System for Money Management
How about a practical example using just $10?
After the child has given the money, he quickly calculates how much he needs to put in each jar, starting with the biblical instruction of him giving back 10% of any earnings to God. He’ll place $1 in the tithe jar, leaving him with $9. This is really important to Jews as it teaches them not to be greedy.
An act that’s emphasized by the next step: placing an extra 10% in the charity jar. Jews believe that giving wholeheartedly is life and that they are building the community by doing so.
Practical Examples of Financial Education
But here’s where things get really interesting. Beyond the charitable desire to help those who are needy, do you want to know why this second jar is so important?
They believe that the more generous a person is in giving without expecting anything in return, the more trust the community passes on to the giver and will want to support him whenever he makes an enterprise.
The benefits of this cannot be emphasized enough. Support from a deep network is crucial to any business. Imagine learning such a powerful business principle at such a young age. You may want to remember this point because it will make even more sense as we go on.
Jewish Perspectives on Spending and Lifestyle
Moving on, though, the third jar is for investments. In the Jewish training system, kids are trained to place 20% of their money into this jar to practice anything they want, provided that it will give them more money in the near future. This isn’t savings; it’s strictly for investments.
Yeah, you might think $2 is too little to make an investment, but how about something as simple as lemonade?
When the jar racks up, they can start it. What I like most about this jar approach is that kids will be given full control and autonomy over when and where to invest their accumulated money.
The Importance of Saving and Investment
The parent wouldn’t even intervene when the kid made a mistake in order to let them learn from their failures. This improves the child’s decision-making and sense of responsibility.
Just think about the difference it’ll make when they get older. Increasing revenues will almost be too easy because it’s like a habit.
As for the fourth jar, Jewish kids are instructed to have 10% of their money saved for emergencies and unforeseen challenges. Yep, the hands-on training even covers unplanned expenses.
The Role of Social Circles in Financial Success
The fifth jar, however, is where they save the remaining 50% that hasn’t been accounted for. The kids can use this for whatever they like, however they deem fit. But that’s just one part. There are many other lessons where that came from.
The Jews have such a special way of viewing money. They spend within their means and always have to adjust their lifestyle to fit their income. Instead of being wasteful and spending carelessly, they’d prefer to do meaningful and valuable things, such as supporting their community and family and investing in their skills, knowledge, and education, creating more value and wealth.
Learning from the Wealthy
Just think about this for a second: Do you treat money carefully, or are you a spendthrift?
Do you create more value with your money, or is it solely to make you look better?
You may think that they’re just being too frugal or stingy, but the truth is that they know money is not eternal but is always subject to risk and change.
The Importance of Mentorship
There is a saying in the Talmud that efforts to earn money or actions and attempts to save money are a reflection of throttling. Great wealth requires hard work to pursue, and at the same time, it is necessary to eliminate loopholes in order to accumulate.
This statement tells us that if you want to be rich, you have to do two things well: work hard to make money and work hard to save it. When you think about it, it’s quite true.
If you want to amass wealth, you will have to increase your income while doing all the things you can to keep it going and spending less than you earn.
