"At the extremes, our minds turn to Bill Gates or Mark Zuckerberg, true geniuses who leveraged their intellect to establish ultra-successful companies. Extremely successful founders and entrepreneurs do often skew as highly intelligent. But we also intuitively understand that having a high IQ doesn't automatically mean a red carpet path to riches is going to unfold in front of you. Factors like luck and social networks play a key role."
"A researcher analyzed the IQ, income, financial difficulties, and a host of relevant lifestyle variables 1 of thousands of participants, all U.S. baby boomers whose information was part of a dataset called the NLSY79. The researcher found that IQ is a strong positive predictor of earning a higher salary. To put the effect size into perspective, he found that a 1-point increase in IQ translates to a $234 to $616 increase in annual salary."
Data from the NLSY79 cohort of U.S. baby boomers show higher IQ predicts higher income, with each IQ point associated with roughly $234–$616 more annual salary. The association remains after controlling for race, gender, parental wealth, and education. IQ shows a smaller positive relationship with net worth. Higher intelligence does not prevent financial distress or bankruptcy. Non-IQ factors including luck, social networks, entrepreneurship, and behavioral money skills substantially influence wealth outcomes. Extremely successful founders often have high IQs, but many wealthy individuals are not the smartest in their networks. Financial competence requires more than raw IQ.
Read at Psychology Today
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