Where Is Your Wealth?

Where is Your Wealth?

I have been speaking at several seminars lately on the topic of building permanent wealth. One of my favorite things about speaking at seminars is talking with the participants one-on-one. In just the past few weeks I've met hundreds of people with diverse backgrounds, various educations and different professions. All of them wanted to know how to build permanent wealth. And much like those of you I heard from last week, they wanted to know exactly what they needed to do.

Whenever someone asks me what to do to build permanent wealth, I answer that question with a question: Where is your wealth? Where is your wealth today and where is your wealth going?

In other words, where are you today in terms of how much you own versus how much you owe? And, where do you want your wealth to be?

Take a few seconds to think about your answer.

- The Answers -

It is very rare that any one answers my question with absolute certainty. Here are the answers I typically receive:

Most popular: "I have no idea"

Close second: "Oh, somewhere around....ummmmm....about...$X and I want it to be X times that"

Funniest: "I keep wondering the same thing! Where is my wealth? I work and work and work, make great money, but I have nothing to show for it! Where is it going?"

At first, it's easy to conclude that these people must just not care about their wealth because they have no idea where they are today or where they want to be with their wealth. But the people I spoke with recently are people attending seminars specifically to learn more about building wealth, so obviously they care. So then why don't they know the answer to this question?

I've concluded that most people don't know the answer because they don't know how to get started on building their wealth. I'm learning that this is a common place for people to be.

The traditional route to getting started has been to meet with a financial planner and find out when you can retire based on a certain amount of savings each month.

My approach to wealth strategies is the same approach I use when I create tax strategies. In fact, the two are intertwined. A successful tax strategy will produce tax savings and then leverage those tax savings by integrating them into a wealth strategy. This is a great way to supercharge a wealth strategy! But my approach with both always begins with (1) Where do you want to be? and (2) Where are you today? If this sounds similar to traditional financial planning, it's not.

Simple But Not Easy

This concept of starting with where you want to be and where you are today is a simple concept to understand. But, it's not always easy to do.

It's very similar to a fitness program. When I started my fitness program, I needed to establish where I was when I started and where I wanted to be. This was a simple concept for me to understand. But, when I went to execute it, I found it wasn't so easy. I knew what my weight was and where I wanted it to be, but what else was there? At the time I started, I didn't know what else there was, but since then, I've learned many other ways to measure these two points in time - body fat, key body measurements, specific goals, like completing a triathlon in a certain amount of time by a certain age. Now I can create a list that goes on and on but that wasn't' the case when I first started.

When determining where you are with your wealth, there are financial calculations that need to be done, soul searching to be done to determine what you really want and, of course, the time to actually sit down and do it! All of these are not necessarily easy to do. But the good news is that they are not impossible to do, it just requires time (and it doesn't have to be a huge amount of time), effort and focus.

So, Where Is Your Wealth?