PROVERBS 13:11 (NET)
Wealth gained quickly will dwindle away, but the one who gathers it little by little will become rich.
29 years in business have left me with a lot of knowledge about how people obtain wealth. In all those years, I have come to learn that most people have obtained wealth like a lot of others. I have come up with the ten most common ways that I have seen people gain wealth. Some of these strategies can be used by anybody. So take a look and see what changes you may be able to make to acquire and keep more wealth. I will share five of them with you today and five of them next week.
- The Disciplined Approach
Though you may not think it to be glamorous, saving and investing is by far the most common way that I have seen my clients gain and keep their wealth. Most of them have saved for 20-30 years, and even if there is no rate of return, you will eventually have a good nest egg. Anybody can save and small sacrifices go a long way.
- Employer Matched Contributions
I commonly have prospects and clients coming in that have gained wealth by having a 401k or another retirement account through their employer. While they are saving, like the situation above, some of the funds contributed to a retirement fund are matched by their employer. This compounds the savings. The more you save, the more you receive.
- Successful Entrepreneurs
Successful and established businesses take years to develop. The business owners that I have managed wealth for became financially successful by never giving up or giving in. Take into account all of the risk, innovation, hard work, stress, determination and faith that it took for their business to begin to be profitable. All of this eventually pays off.
- Lump Sum Pension Retirement
While this method was very big 7-10 years ago, it has since lost some popularity. This acquisition of wealth occurs when an employee is paid a large sum at retiring from a large corporation, rather than a fixed guaranteed income for life. Many companies chose this route to limit the financial risk if the employee lived many many more years. Many employees chose this route to limit the risk of the company one day being dissolved, sold, shut down, etc, along with all of their “guaranteed income.”
This method of receiving wealth is becoming one of the most common ways. As Tom Brokaw calls them “The Greatest Generation,” our seniors are passing on their wealth to the Baby Boomer generation. Sometimes millions left behind, “The Greatest Generation” worked hard and saved much.
Stay tuned for next week’s blog; I’ll share the rest of the most common ways I’ve seen wealth obtained. Read Part Two