Why Dumb People Earn More Than Smart People

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Edited By: Andrew Gonzales

Music Courtesy of: Epidemic Sound

Select Footage Courtesy of: Getty Images

All materials in these videos are for educational purposes only and fall within the guidelines of fair use. No copyright infringement intended. This video does not provide investment or financial advice of any kind.

#business #finance #careers
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Dumb people make more money than smart people and it took a study conducted by really smart people to prove it. A study out of Sweden has found that top earners have lower intelligence than the people in income levels directly below them.

The Plateauing of cognitive ability among top earners drew on data from 59,000 men who had to take a compulsory military conscription aptitude test. It then tracked their earnings over their professional careers to find the relationship between intelligence and income. Before Tai Lopez gets any ideas for more shitty YouTube commercials or the hustle bros learn how to read journal articles and use this to encourage people to drop out of college, I want you all to know how this data really works.

The relationship between intelligence and income was strong, smarter people earnt more money but only up to six hundred and seventy thousand Swedish krona or sixty-four thousand dollars per year. After that intelligence didn’t mean much anymore and at the very top end of income earners, the 1%, dumber people actually did better.

So is this a sign that watching TikTok and reality TV is actually better for your career than going to college? Well maybe actually, for two important reasons but there are also two reasons why you should probably ignore this and keep studying hard if you want to get ahead financially. Reason number one why dumb people are doing better than smart people is that smart people fill in high prestige jobs that don’t have high salaries.

Academics and research scientists are some of the smartest people in the world, but they don’t get paid well. Doctors, lawyers and elite financiers also need to be very smart to get through demanding schooling and admission exams and these professionals ARE typically compensated very competitively BUT most of them don’t make it all the way into the 1%. In the USA to be in the top 1% of income earners an individual needs to make at least five hundred and ninety-seven thousand dollars before tax and that’s just the minimum to join the 1% club.

so it’s time to learn How Money Works to find out why dumb people are earning more than smart people and why this trend is completely meaningless for your own career planning.

[williamyt]

If you saw this, and think "Ah, I'm smart, that's why I'm poor", you are not one of those smart people.

[misterhat]

My dad was a physician, he would always say that the top 3rd of med school graduates would become academics, the middle 3rd would make the best doctors, and the bottom 3rd would make the most money.

[BiscuitDelivery]

Survivorship bias is a big part. Dumb people gamble for success while smart people are slow, methodical, and disciplined. Taking huge risks with huge rewards can reap terrible consequences but if you succeed at your venture your ceiling for success is far higher. When you look at these top earners, you're looking at the gamblers who succeeded and missing the mountain of failures who you will never hear of.

[LucasSmith]

The problem we have is because Most people always taught that " you only need a good job to become rich " . These billionaires are operating on a whole other playbook that many don't even know exists.

[squawkdude]

I knew a guy at work that was forced around from job to job within the company because he was "dumb". Apparently he received a raise every time this happened because of negotiating power and a "diversified" resume.

[blueman]

I could have told you this without a study. I'm an attorney that does wealth management and protection for the 1%, so I deal with the 1% every day. Being charismatic and lucky is far more important than being intelligent when it comes to being in the 1%.

[abbysmith]

When I was in undergrad, the top students went into sciences and elite academic majors, while the B and C average students often went into business and marketing, where the material was much easier and they didn't have to try or study as much.

Years later, those lesser achieving students are often far wealthier because they received their education in a subject that would work for them economically, while the kids that were at the top of the class are now serving under the kids that were always too lazy to get higher grades. And if you want an explanation as to why management is always so awful...

[zombieapocalypse]

This brings new meaning (or confirmation) to the old adage "It's not what you know, but who you know" that makes a difference in getting ahead in life.

[RandoomDude]

Money is basically just an indicator of how good you are at navigating the social game, in most cases

[lombardo]

I love how everybody and their mother on social media always tell people to quit their 9-5 and go into business. Yeah like every body can be an entrepreneur

[i.ai.a]

The first sentence killed me 😂. "Dumb people makes a lot more money then smart people. And it took a lot of smart people doing a study to find it out"

Imagin how the scientists must have felt when reaching that conclusion. Did they feel smart or dumb.

[hankmarks]

Making money is not the same as keeping it there is a reason why investments aren't well taught in schools, the examples you gave are well stationed, the market crisis gave me my first millions, people shy away from hard times, I embrace them., well at least my advisor does lol

[YannMetalhead]

I believe luck plays a role much bigger than people are comfortable to admit. Two people with the same intellect and skills can have a completely different life based in what country they born and from what parents.

[BetaProductionz]

One thing that wasn’t talked about is that being so much smarter than the average person makes it harder to relate to average people, aka the people who make up the vast majority of the economy and from whom you have to earn your money. It helps to be a bit smarter than your average customer, but not too smart that you can’t even understand them.

[allisonirvmiller]

I remember a quote from one of my favorite TV shows which is Mr. Robot and it goes, “Power belongs to the people that take it. Nothing to do with their hard work, strong ambitions, or rightful qualifications, no. The actual will to take is often the only thing that’s necessary.”

[emiliomartineziii]

Honestly, from this, it seems that extreme wealth has more to do with luck and randomness than on merit

[JWelsh]

As someone who went to top undergrad and graduate institutions, I would add that most truly smart people are looking to accomplish something other than maximal income with their careers. They'll happily sacrifice income to feel like they are using their intellect to improve the world. I think this often stems from so many adults telling gifted children that they hope they'll use their talents to make the world a better place when they grow up. I don't think average kids are groomed to expect such things from their work and feel freer to just chase money. Then again, it could just be that smart people demand more from their work than just income or are more likely to refuse to make the sacrifices to their personal lives that chasing very high income often entails.

[gailcbull]

I love to see an analysis on how personal ethics plays into this dynamic as well. Having worked in corporate jobs, I've noticed that the people who can "turn off" their personal ethics and do things that they would never do outside the work place, often get promotions before employees who refuse to behave in unethical ways. I remember seeing a video clip of a Ted talk where the presenter said that there are more clinical psychopaths in high paid positions then in the average population, and all the "business leaders" in the audience looked shocked. My reaction was, "that doesn't surprise me." No one can turn off their ethical code as quickly a clinical psychopath.

In other words, you don't have to be clinical psychopath to get ahead, but it helps.

[operabrotha]

It’s frustrating that many still confuse the word “intelligent” with “educated”. The people described in this video as “intelligent” are actually the highly educated who tend to go into professions requiring advanced degrees. But they are still employees, which, by definition, means that there is a cap on how much they can earn. Steve Jobs dropped out of college, so he was not highly educated. But no one would ever claim that he was not intelligent. He used his intelligence, instincts and capacity for enormous amounts of hard work to build Apple and change the world of computing, and become extremely rich doing so.

[scottguitar]

Being dumb may also make you more likely to take risks. Like most things in life, you only need to be good enough and there is a factor of luck in terms of being at the right place, at the right time, with the right skill set. I think the biggest factor of success is recognizing opportunities. I see opportunities all the time, they are frequent, yet I see plenty of people oblivious to them.