Future financial wealth creation is primarily hinged on adequate financial planning and budgeting in the present. Hence, individuals who seek to proliferate their wealth prospects require a well thought out financial plan of expenditure and investments. Financial planning plays a key role in our success and should be given due weightage. Financial planning and the creation of wealth by word and spirit involves comprehensive mapping of the financial elements of our lives into a master plan. It entails setting up short term and long term goals in relation to the various facets of financial planning such as asset management, investment management, cash flow management, insurance, estate planning and many other aspects of others financial well-being.
Do you have a plan in place? If not, what are you waiting for?
To accelerate your personal financial growth, you’ll need a target wealth creation plan that will help you expand your personal wealth though the following ways:
Through Income Growth
For future financial wealth creation, you’ll need to lay the groundwork now to ensure stable and growing earnings. For instance, as an employee, you’ll need to consider investing in education to better your skills thereby, increasing income. As a business owner, the stable growth of your business(s) is vital for financial security.
Additionally, you’ll also need to learn how to better manage that income. Adequate management of income as it comes in from your career or business is vital to expand your wealth. Here, we leverage time to invest and expand wealth. This is where your master plan will come into play. How you execute it matters in accelerating personal financial growth.
Learn more: How to Build a Passive Income Strategy
Through Investment Growth
For you to hit your target wealth in this lifetime, you’ll need to be making money while you’re asleep.
Target wealth creation can be achieved either by making new investments in phases or rewarding existing assets that grow in value. Though the latter is a function of decisions made in the past, it can be expanded to reduce risk, increase return and create more wealth through diversification.
If you are starting out now, there are few preemptive fallacies you need to avoid while developing your long-term financial goals:
a. Undermining your own financial needs and preferences. This leads to poor financial coverage and resource misallocation. Once you have a predefined resource list, draw a clear line between expenditure and savings targets to achieve your financial goals.
b. A single focus that limits your area of play and returns. Diversify your investments as much as you can. Consider taking on expert advise and strategically model your investments in such a way the derives maximum yields.
Learn more: No Shortcuts. No Cheat Sheet. Expectancy Investing!
Through Personal Development
There is saying that goes, “For things to be different, you have to be different. Before financial success can occur, personal growth must occur” – Jim Rohn
In order to sustain your personal financial growth, you’ll need to grow and expand your skillset. Your skills for financial management will catapult your growth to new heights and move you closer to your target wealth.
With personal development there are several other things you can leverage:
- Systems and technology. Learn how to use the financial technology that’s in the market to get more done with little effort. Nowadays, more and more people are utilizing Robo-advisors (digital financial advisors) to automate, lower cost and better manage their assets based on their goals and risk appetite. Other systems and technologies you can use budgeting assistant apps, AI virtual assistants, cryptocurrency and blockchain, insurtech, digital lending and credit and more.
- Networks. Use your network to utilize other people’s resources and connections to gain market insight and move beyond your own galaxy of information.
- Knowledge. Yes, you can expand your own skills and expertise on the subject but don’t limit yourself to just that. Also leverage other people’s talent, expertise and experience. With it, you make use of a greater body of knowledge that you can ever come to possess on your own.
All in all don’t simply manage your time, leverage to get the most out if. What we have for sure in this life, is limited time.
Learn more: Leverage: The Key to Amassing Wealth
Through Debt Management
To move even further and fast track your financial goals, you’ll need to utilize financial leverage. At some point, if not now, you will need to leverage other peoples money and expand your own financial limits to generate more in income. To ensure this option is open (if you’re not already utilizing it), keep a financial good standing. Adopt good debt management habits.
Consider the following 3 c’s of creditworthiness:
- Character. Reduce your own perceived risk by building trust. Maintain a good credit score and always pay back on time. This will help you establish good relationships with lenders,
- Capital. Maintain a healthy book of assets. This may be savings or assets that can be used as collateral. At some point, you may want to go big and will require security for leverage. Whatever assets or resources have, maintain them well and keep growing their value.
- Capacity. If you have a steady and growing income, then your present and future ability to meet financial obligations will not be called into questions. Thus, focus on income generation and growth.
Learn more: How to Build Wealth Rapidly
Key Takeaway
Creating and building wealth is a marathon that requires a holistic rather than a selective approach.
Three key takeaways:
- To move from now to your desired future, you’ll need to utilize resources that extend beyond what you currently have – expand your income, investment opportunities, personal skills and your creditworthiness.
- It is wise to consider having an expert advisor that will help you develop a holistic model of your investments for maximum returns. Every area of your life needs due consideration and adequate resource allocation.
- Don’t be restricted by your current personal limitations, there is wealth to be out there. Get it, leverage it…just go for it.
Happy Building!
Image credits: Top by Karyme França from Pexels