|Wealth Building Information|
Building Wealth: A Wealth Building Strategy Is More Than Simply Diversifying Your Investments
Wealth - an abundance of values. Each of us determines what is or is not of value to us. He or she may not be wealthy even though they may have a great deal of money because they have no honor, no happiness.
I measure wealth not only by the numbers but by holding it up against my happiness level at any given time. Building wealth is fine, but most people assume you are interested in building wealth to become secure, stable, and happy in life.
Assuming you are happy, just not thrilled with your current portfolio returns, you should know that there is more to diversification beyond what the average person thinks is all you need to know.
With a successful wealth building strategy comes the understanding of what kinds of diversification offer you the protection you need from taking great losses in the short and long term.
"Wealth is when small efforts produce large results. Poverty is when large efforts produce small results."
Financial wealth involves the ownership of multiple money producing assets that flow to you, not money draining assets that flow from you.
Investing is a fundamental way to build financial wealth. The sooner you start to successfully invest the more opportunity your investments have to grow.
In order to build wealth there are four simple things you must do:
1) Control your spending.
2) Pay off debts that don't produce some form of income to you.
3) Create or acquire wealth building assets or income streams.
4) Acquire the knowledge to learn how to leverage your TIME and your ENERGY.
Try seeing "diversification" in an entirely different light. As an example, David Futrelle, Money Magazine, wrote a great piece on this entitled "Build Wealth in any Market."
In it he discusses that diversifying investments in your own country's stock market may not be diversified enough.
"More than half the world's stocks are traded outside the U.S. We think it makes sense to keep at least a quarter of your stock money in foreign equities." David Futrelle, Money Magazine, August 12 2004.
Futrelle goes on to give tips on diversification. This is a good exercise in building wealth in the unstable world of stock investing.
Additionally, think of how you can diversify the following sets of capital:
1) Human Capital (your job and career),
2) Physical Capital (your house and other possessions) and
3) Financial Capital (those stocks, bonds and cash).
All these components should work together in your wealth building portfolio.
Diversifying financial assets alone will not offer you enough protection without understanding what kind of diversity offers true protection against avoidable losses.
Learn How to Bank Like a Banker
The business of banking has changed dramatically over the last decade. Because the cost of doing business the old-fashioned way is no longer effective, banks are interested in changing their customers' behavior by encouraging electronic banking alternatives whenever possible. They have done this by charging high fees for services that were once free. If you pay $200 or more in annual fees for banking, it's time to do some competitive shopping.
Re-discovering the Fundamentals of Financial Planning
To lose weight in the 80's, we went on low-calorie diets. In the 90's, we switched to low-fat diets, and now, in the 21st Century, we are completely convinced that it's all about the low-carb diet. What ever happened to just eating healthy?
Investment Techniques For Creating Passive Income
There are many wealth creation strategies and investment techniques available to those who are looking to create a passive income. These fall into three main categories. Running a business, investing in property and investing in the share market. Although there are many options in each of these areas, finding the right wealth creation strategy for you is not that hard.
Jobless? You Stand To Be Rich!
This is a true story about a homeless man from Illinois. This man slept in alleys, park benches and wherever else he could find enough space for himself. This man used to beg for food and money. He had nothing but time to himself.
Financial Intelligence - Natural Marketing For Lone Rangers
"Ooooooh," you may say, "I could NEVER be good at marketing, I'm just not that sort of person. I'm just not pushy enough".
10 Ways to Save $50 Per Month: The Art of Pinching a Penny Until It Screams
1. Save up to 50% per month on convenience cleaner cloths by cutting them into half, i.e. dryer softener cloths, face cleanser cloths, etc.
The Wealthy Mindset
What is the difference between wealthy people and poor (even average) people? It is not all the money that wealthy people have and the average don't, nor the luxury, nor the lifestyle. It is their mindset.
Your Money Or Your Life
Have you stopped to realize that although you go to school to learn about important subjects, no one teaches you how to manage your money? Money is an essential part of life in our pursuit of happiness, yet very rarely will a parent sit down and tech their child how to handle their money. This is true in grade school, high school and worst college. So what happens? Many of us end up in an extremely large amount of debt. We can't seem to get it together even if we make more money. I found myself in this trap about 13 years ago. I had an okay job, a car, and an apartment. Nice I thought soon I would buy a house and live the "American dream". Wrong! I could never save enough to buy a house. I had plenty of credit cards, so many that I never had enough money due to many payments to put aside for my dream home. What was happening to my paychecks? Well, I was over extended in credit card debt for one. The buy now pay later syndrome was well embedded in my head. That mentality had to stop! Since, I wasn't terribly behind in my payments I was able to get some help from the creditors. I simply asked for a lower interest rate and/or the ability to skip a payment. After that call, I had to cut up and dispose of the cards. No! I didn't cancel my cards but I got rid of them just the same. Next I bought a tablet just for my budget information and bills. I also purchased a software program to keep track of my expenses. I think it is important to keep something manual that you can carry as well as a computer software tool. Next, as bills came in, I wrote them down with the name, address, phone number of the creditor, my total balance, interest rate, and minimum payment due, the due date, and if there were any annual fees acquired with the card. Review the card with the highest interest rate and pay more then the minimum due. Always ask if they can reduce your rate or seek the possibility of debt consolidation buy applying for a low interest rate loan or credit card. If you haven't cut up your credit cards do not get a consolidation loan. Because most likely once your payments are manageable you'll start using your cards again. Minimizing your spending is the key to financial freedom. Make sure to start a savings plan after you've gotten your debt under control.
Understanding the Three Different Types of Income
Part of learning to become financially free is to begin to understand that there are three different types of income. They are: capital gains, passive income, and earned income. They are the three types of ways to make money, and are very easy to understand.
Increasing Your Wealth by Increasing Your Financial Literacy
Perhaps the primary message of Rich Dad, Poor Dad is increasing basic financial literacy. Perhaps I should say financial literacy for the common man and woman. The reason I say this is because the principles taught in the book are very simple--the fundamental personal finance. Some people may even say the what Kiyosaki teaches is dangerously simplistic.
How to Save Money for Retirement
Saving money for retirement can be easy or difficult depending on your current salary. If you are like 75 percent of the American population, earning just enough money in your current job to meet your monthly bills, then it's time to do some serious thinking on how you are going to live when you retire.
Financial Planning For Singles
Financial planning often gets a bad rap. Part of the problem is self-inflicted, since some industry participants would rather sell you a product than address your financial concerns. The process of planning is important, though, whether done with a professional or on your own. After all, you wouldn't leave on a long trip without looking at a map ? a poor analogy for some of us men, but you get the idea.
Why You Need To Buy and Sell Gold Coins (Part 4)
Top Investment Performance
3 Steps To Increasing Your Income
Most accountants, financial planners and wealth-building experts agree that there are really only three ways to increase your income. You can either:
Personal Budget Programs
Do you have financial problems? Then a budget is the answer if you are tired of wondering where your income went. A budget is the answer, if you don't have savings. A budget is also the only solution to getting out of credit card debt.
Top 10 Secrets of Getting Rich!
As many people have observed, "Success leaves clues." If you want to achieve extraordinary success in the coming year, study the experts, do what they do, and modify their techniques to suit your particular situation. It's easy!
I Dont Need A Financial Coach To Help Me!
You've been thinking that your financial life could probably be better, right? Maybe you think, "If I could just stick to a budget everything will be fine?", or how about "When I get that next raise or promotion, I'll have enough money to pay off my debts and save some money?" You may even be thinking,"I can do this on my own!"
7 Wonders of the Offshore World
Many people assume that the offshore world is accessible only to the super rich looking to increase their wealth, or to large multi national corporations looking to escape taxation.
The Financial Equation that Will Set You Free!
I have a good friend who works in an area of the US that has more than its share of poverty. He called me the other day with a very broken heart. He was feeling badly for the people around him who simply do not allow themselves to get set free financially. I could feel the pain he was feeling because I too, very often wonder why it is that some people experience financial independence and others do not. It really is a mystery.
Wealth Creation and Mortgage Planning - Two Great Tastes that Taste Great Together
What if I were to tell you that almost everything you have been told about what to do with your home has been absolutely wrong and that one of the worst ways to build wealth is through your home? And what if I further went on to show you that anyone who perpetuates this myth probably is not your best source for accurate financial information?
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