Would you rather be in the top 1% of the wealthy, or top 1% of the intelligent?

I often write on Quora.com, where I am the most viewed writer on financial matters, with over 434.9 million views in recent years.

In the answers below I focused on the following topics and issues:

• Would you rather be in the top 1% of the wealthy, or top 1% of the intelligent?
• What is the cheapest but most developed country to live in (2022)?
• Why should we fear losses in investments?

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Source for all answers – Adam Fayed’s Quora page.

Would you rather be in the top 1% of the wealthy, or top 1% of the intelligent?

Is intelligence the same thing as being cultured and highly-skilled?

Does intelligence guarantee happiness?

Does it guarantee wealth and high-income?

The answer to all of those questions is no. Intelligence merely increases your odds of becoming wealthy.

IQ tests are flawed, but there is a correlation between high-IQ and more wealth and income.

If you are already wealthy, it is very unlikely that gaining more intelligence, and starting out again, will make you wealthier, or happier.

Would Bill Gates be wealthier and happier if he started out again with higher levels of intelligence?

Why the “everyday millionaire” in your street be wealthier, happier or get any extra benefits from the intelligence, if they started again?

It is doubtful. Wealth, if used intelligently, gives you more options. Those options include the ability to read more, and therefore become more cultured, and trade some money for enhanced time if that is your wish.

What is more debatable is if you gave people these choices:

• Being in the top 1% wealthiest people alive but be young again
• Being in the top 1% wealthiest people but be healthy again
• Being in the top 1% wealthiest people alive but have more free time again
• Being in the 1% wealthiest people alive but having a higher income. This one is more common than you think. You only need about $800,000 of wealth to be inside the world’s top 1%, even though that figure is much higher in most developed countries. Plenty of those people are asset rich, cash poor.

The number of wealthy people who would give up their wealth to regain youth and health would be high.

Yet that is because most wealthier people are older, and plenty of older people would make the same choices, regardless of levels of wealth.

Why should we fear losses in investments?

It is natural to fear a loss.

A loss isn’t a decline. A decline isn’t a loss until you sell.

A loss means you have actually sold a declining position. It is rational to fear that, unless you are doing it on purpose.

People only do it on purpose if they engage in strategies like tax harvassing – deliberately taking a loss in some situations to lower taxes.

What we shouldn’t fear is:

• Tiny losses. How can you learn in investing, business or life, if you never lose or make mistakes? It is better to fail with smaller amounts of money though.
• Losses which are inconsequential in the grand scheme of things . In business investments, as an example, it doesn’t matter if many go wrong, if a small percentage more than make up for that.
• Volatility. All of the best performing assets in the world have been quite volatile, with numerous periods of huge declines. Here Warren Buffett’s business partner Charlie Munger being asked about whether he is concerned with the fact that Berkshire Hathaway’s stock is down 50% when he was asked about a decade ago:

• If it takes years to recover from the decline (paper loss). There have been many occasions when even the best investments have taken a long time to recover.

So, people should fear significant losses, but not big declines, especially whilst you are young or at least have five years before retirement.

As you approach retirement, especially when you are retired, it makes sense to take many risks off the table.

What is the cheapest but most developed country to live in (2022)?

This is what some parts of LA and New York look like:

And this is what some areas of Bucharest can look like:

The GDP per capital of LA is over 80k, versus something like 15k for Bucharest.

So, it depends how you define developed. If you define it in terms of great infrastructure and something that “feels” developed, then probably a capital (or at least big) city in South East Asia or Eastern Europe.

Somewhere like Bangkok in Thailand

Or KL In Malaysia

In these places, you can live what “feels like” a developed life for less.

If you define it in terms of places with high GDP per capita, then I would say:

• Taiwan
• A few oil rich nations, if you get a job there, like Saudi Arabia. This is due to the subsidies on oil and other things.
• Most poorer areas of developed countries. For example, some parts of the North of England or Eastern Germany.

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Adam is an internationally recognised author on financial matters with over 830million answer views on Quora, a widely sold book on Amazon, and a contributor on Forbes.