Monopoly has been a well-known board game for decades. Many children around the globe grew up playing it, and even adults rave-up for a competition. Besides giving a way to pass a few hours happily playing fun and exhilarating game, Monopoly offers quite a lot of lessons, especially in finances.
This ultimate strategic planning game revolves around utilizing the money to put up financial assets and secure a well-furnished financial future. So, whether you are a kid, student, a housewife, a working professional, an entrepreneur, or an investor, Monopoly extends valuable lessons you can learn.
Monopoly Lessons You Should Know
The first-ever Monopoly game was played in the midst of the Great Depression, making Monopoly’s history deeply embedded along with the global economy. Through playing Monopoly, anyone could become a financial genius and turn into a property mogul.
Start dusting off your game boards and let it bring forth these nine valuable lessons you could carry off by playing Monopoly.
Always Have Cash
There is no means of knowing what the chance card will throw away in the Monopoly board. Perhaps, you could be required to pay school fees, taxes, upgrade your hotels, move forward to the closest railroad, and pay twice the rental price. Without cash, you will be forced to mortgage or put up your assets for sale.
During the Great Recession, way back in 2008, people tend to spend money like there’s no tomorrow. When the market declined, banks were left cashless, forcing people to put their assets on sale at a much less price than they initially paid for. On the other hand, those people who had cash purchased assets for a lower cost, making them save and generate more money.
In able for you to win, you should always have cash on hand. Hence, you should not buy everything you want as it will only leave you broke, having not enough money to pay for your financial obligations. If you don’t want to end up selling off your assets to pay for emergencies and living expenses in the future, make sure to keep some money in reserve for rainy days.
Making savings and creating a plan for an emergency are powerful tools to battle against financial troubles that may come in the future. So, make it a habit not to spend cash on important things.
Patience Pays Off
If you’re hurrying to get every asset you get your hands on, you will end up having no money, and you’ll have a tough time winning the Monopoly game.
Monopoly requires a thorough strategic game plan. Taking the game slow will allow you to sharpen your goals and give you an opportunity to approach every obstacle with enthusiasm. In addition, by having the patience not to buy assets impulsively, you will probably develop an eye on which assets you should buy and let go of.
In real life, you should also be disciplined, possessing long patience. Warren Buffet, one of the richest people in the world, is one of the few investors who got laughed off when they didn’t invest in the internet companies during the first internet stardom back in the late 1900s.
However, when the speculative investment faced a decline, most who put up their investment faced huge losses due to their impatience. Warren Buffet got the last laugh for patiently observing the market first before jumping into buying shares.
Cash Flow is Important
Monopoly is a plain sailing game with no complexities. You initially have money to buy assets, and your goal is simply to be the last player to have money.
Many people missed the scheme of the four railroads, which generates the best cash flow. On the condition that you possess ownership of four of them, you are in a good position. Each of the railroads costs $200 and having the right to the four gives you a 25% return or $200 in rent.
The technique to win in Monopoly is through cash flow. In reality, you have to increase your cash flow for your assets to grow bigger.
Diversify
Owning just one property and loading your Monopoly board with hotels won’t bring you victory. The same goes if you attempt to purchase every asset on the board while spreading too thin.
Victory chances will become higher once your property is spread throughout the entire board. Diversified properties will give a stronger possibility of having an opponent land on your property, capturing rents from them. You can also apply this very principle to investing.
Putting the eggs that you own all in one basket was never a beneficial idea. If you put all your hopes solely on one or two stocks, there will be a huge potential of having your investment wiped out if anything goes wrong. So, diversify wisely, and do not limit your assets around one or two.
Take a Break
Being in jail in Monopoly might seem a bad thing, but sometimes, it’s not as it keeps you from paying rents and gives you time to think of a strategy you could do to take a step forward.
In real life, you also need to withdraw from your busy schedule so you could have time to think, lie down, and relax. In addition, taking a break will help you determine the actions that are working and those that aren’t. And this will help you decide the necessary step you could undertake.
High-priced Assets Does Not Guarantee Success
Many players lose at Monopoly for buying high-priced assets without thinking about the cost. Plenty of players desires to own Boardwalk or Park Place because they give the highest returns, neglecting the fact that these pieces are expensive to maintain. Giving too much attention to cash flow without thinking about the cost to gain those cashflows is to play the game with curtains close.
When you focus too much on buying costly assets, you are positioning yourself for losses by overpaying. Possessing a Park Place or Board Walk, which are expensive, is not the key to winning at Monopoly. The secret to earning more money is buying low and selling high. That way, you could generate a pretty much higher income.
Control Your Emotions
The thought of losing money is annoying, even if it’s just a game. So, you should be aware of how your emotions affect the course of action you take in a game. For example, your emotion may cause you to be impulsive and buy every property, or insecurity may cause you to sell valuable properties to immediately make money, doing huge damage to your money reserves.
You should never allow emotions to rule the choices you make. Instead, every decision should be examined thoroughly, considering all its advantages and disadvantages. By not letting emotion dominate your mind, you can develop a more rationalized decision that leads to a better chance of earning money.
Take Risks
In Monopoly, taking calculated risk is essential in order for you to win. Perhaps, buying a house at the risk of exhausting your finances because you observed another player nearing a pay-out opportunity could be an example of risk.
Taking risks may somehow seem scary and uncomfortable, but thoroughly analyzing if the risk is worthy could put you at ease. In reality, there are also risks you need to take to step up. This could be in the form of investing your savings or leaving your previous job to get another.
There’s a potential success in every risk. However, do not jump in hastily but consider every aspect that needs attention to minimize potential losses and generate more assets.
Negotiating is Essential
Monopoly revolves around making deals and negotiating. There are circumstances that you will need to go to another player to trade properties or borrow cash. If you negotiate too harshly, no one would want to accommodate you; if you speak too soft, some may take you for granted. And that is why you need to equip yourself with good negotiating skills.
At some point in your job, there might be a need for you to negotiate wisely. For example, you are asking for a raise in salary. If you are a strategic negotiator, you could get a salary higher than the standard wage.
In a nutshell, if you desire to get the things you want in life, you need to have excellent negotiating skills, which you might learn from playing Monopoly.
