Wealth encompasses a lot – health, spiritual, geography, work, family, opportunity, money and more. Ask a really sick person which they’d rather have, money or health.
The trick is having a balance of all measures of wealth. And, determining which measures align with your values and your purpose.
I’ve had money and not had money. It’s a lot better having money. However, having money wasn’t the sole determinant of whether I was wealthy or not. It’s just one measure.
As you enter the second half of life, we’ll explore all of these measures. After all it’s about living your purpose and having the fuel to do so. Money is just the fuel, a tool, to live the life you want.
Here are some truths I discovered long ago from Mark Ford, and have experienced them myself, to be true about creating wealth:
Truth #1
You’ll never get rich unless you understand some fundamentals about saving, spending, and investing. My coaching program covers this in detail and some of the principles are covered in the guide – Take Control. Finish Strong. – download your free copy.
Truth #2
The single most important factor in avoiding the spending spiral that kills wealth is to stay in the house you have now. No one else talks about this. Warren Buffett has been in his same house since 1958. Why is this important? Because mortgage creep is a major factor in robbing you of cash flow. I’m not against bigger homes, but I am against the bigger home preventing you from creating wealth. Your home is not an investment (a topic for another blog post). Your home is a lifestyle choice.
Truth #3
Stock investing is an inadequate strategy for building wealth. Especially at this stage in your life. However, you have to make the most of it. It’s one of the major systems we have to work with, but it can’t be relied upon as the only system. Truer still is you can’t increase your risk because you feel you are behind and have to “catch up.” This is a fools errand.
Even Warren Buffett, the world’s most successful investor, knows this. His wealth has come not from being an individual investor but from being the principal of Berkshire
Hathaway—a business. Keep that thought in mind every time you hear his name quoted.
Truth #4
The most important single factor in building wealth is your amount of investible income. Investible income is what you have left over each month after you’ve paid your lifestyle expenses. If you spend all of your income, then you will never create wealth. This was true when you were young, it’s even truer now.
Truth #5
Investing in rental real estate is a blend of active and passive income. Next to owning a business, it provides the highest return you can get from any financial endeavor. Anyone looking to create wealth and additional income streams should seriously consider real estate. This doesn’t mean it’s right for you. I know people who are extremely rich because of real estate, some who use it to provide steady income for lifestyle and others who’ve gone broke.
Truth #6
The biggest mistake retirees make is giving up their active incomes. While this may be something you want to do some day, it could be a big mistake. If you plan correctly now, you can build a life so good you won’t want to retire from it.
To keep your wealth for a lifetime, you need multiple streams of income. Some may be active, if you love what you’re doing. Some should be passive. And there are many ways to do both.
Do these truths make sense to you? If so, how are you doing?
Download my guide, Take Control. Finish Strong. to know for sure if you’ve got a firm foundation for your second half.
