Use These 3 Tips to Speed Up Your Wealth Building

Most people I speak with are anxious to speed up the process of building their wealth.

Here are 3 tips I’ve developed over the years that are effective at doing just that.

1

Treat your investing like a business.

Successful investing is not a casual activity. When investing is treated like a real business, the level of success skyrockets.

What does a business have that your investing should have? Here are a few items:

  • Vision statement, mission statement and values
  • Systems that provide specific guidance on how things are done
  • A team consisting of advisors, vendors, customers (tenants) and employees
  • Agreements with your team members
  • Reporting that allows you to make informed, proactive decisions
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2

Focus.

When my team and I first talk with someone about their wealth strategy, we usually find they are interested in many different types of investments.

They may want to start a business, invest in real estate and do some stock trading. Our role is to help them narrow their options so they can focus on a single type of investment.

Some people become uncomfortable when I suggest focusing on a single type of investment. This may be because the only way they have been taught to reduce their risk is to have many types of investments. The idea behind this approach is that risk is reduced because the investments will go up and down at different times so overall there is “balance.”

While I’m all for reducing the downside, this approach also limits the upside. I would much rather limit my downside through education – focusing on a single investment type – and not limit my upside.

Or, they may be concerned it will limit their options and success.

Focusing on a single investment type in no way means limiting the number of options. Within any type of investment, there are hundreds, if not thousands, of options.

By focusing, it becomes clearer which investments will work in a wealth strategy and that contributes to the success of the wealth strategy.

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Leverage your tax savings.

Tax savings can be worth more in a wealth strategy than just the actual amount of tax savings.

If someone reduces their taxes by $20,000, then that’s $20,000 more that is available to invest in their wealth strategy.

That alone is good news, but it gets so much better!

That $20,000 can be leveraged with other people’s money to buy an asset worth more than $20,000.

Take real estate as an example. A $20,000 investment could buy a $100,000 property by getting an $80,000 mortgage.

Take it even one step further and invest in assets that generate even more tax savings and put those tax savings through the same system.

Start today

Identify one thing you can do today to power up your wealth strategy. It can be one very small thing. Then, build on that every day.

Tom Wheelwright, CPA

To ensure compliance with requirements imposed by the IRS, we inform you that any US federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and it cannot be used for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein. If you are not the original addressee of this communication, you should seek advice based on your particular circumstances from an independent advisor.

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