Controlling your financial affairs requires a budget or cash flow statement. Budgeting and tracking your expenses gives you a strong sense of where your money goes and can help you reach your financial goals, whether they are saving for a down payment on a house, starting a college or university fund for your
children, buying a new car, paying off the credit cards or planning for retirement. A cash flow statement provides you with the following benefits:
1. Know where you stand - A cash flow statement allows you to know exactly how much money you have. The statement shows you how your funds are allocated, how they are working for you, what your plans are for them, and how far along you
are toward reaching your goals.
2. Communication - A budget is a communication tool with other family members to discuss the priorities for where your money should be spent.
3. Control - A budget is the key to enabling you to take charge of your finances. With a budget, you have the tools to decide exactly what is going to happen to your hard-earned money—and when.
4. Identify opportunities - Knowing the exact state of your personal monetary affairs, and being in control of them, allows you to take advantage of opportunities that you might otherwise miss.
5. Extra money - A budget may produce extra money for you to do with as you wish. Hidden fees and lost interest paid to outsiders may be eliminated. Unnecessary expenditures, once identified, can be stripped out. Savings, even small ones, can be invested and made to work for you.
6. Other benefits:
• Indicate your ability to save and invest
• Let you analyze your standard of living
• Indicate if you’re living within or beyond your means
• Highlight any problem areas
August 12, 2011
August 11, 2011
How To Address The Concern of Outliving Your Retirement Savings
One of the worst nightmares for an investor is to outlive his/her retirement savings. However, there is a solution to this concern through the purchase of a longevity insurance product. A "Longevity Insurance" provides guaranteed income typically starting after you turn 85, in exchange for an initial investment made some 20 years earlier. Payouts are fixed and cover you and your spouse for as long as you live. With some variations of this product, you can also opt for a death benefit, which guarantees that your account will hold a certain value that can be paid out to your heirs if you die before the payout age.
One of the main concerns of many individuals approaching the retirement age is the valuation of their current retirement savings and how to catch up. One solution is to increase the risk to and exposed your retirement account to equities in order to bring enough growth in the portfolios. However, this can come at a costly price. One solution to consider is a longevity insurance product. These longevity insurance products are effective in combination with an investment strategy. With a guaranteed income starting at a predetermined point in time, you'll basically take the biggest unknown out of your retirement-planning strategy; "how long your money should last?". You could be more aggressive with your investments and fine-tune the size of your withdrawals without the fear of running out of money.
Recently Mr. Peng Chen, Morningstar’s president of the investment management division, reported the following:
1. many investors do not estimate how long they will live and end up shorthanded on retirement funds.
2. people who are overly optimistic about how long they will live may have a too-frugal existence in retirement.
3. roughly half of retirees live longer than their life expectancy.
4. financial markets are far more volatile than many financial planners account for, and
5. retiree’s exposure to stocks and bonds can put their retirement savings at risk.
One alternative is to combine a traditional product like a mutual fund in combination with a longevity insurance product. As an investor you should consider when saving for your retirement the following:
1. age
2. financial market risk tolerance
3. retirement expenses
4. longevity, and
5. bequest goals
If you're someone who is concerned with the possibilities of outliving your savings, you may want to consider longevity insurance. However, this must be done with careful analysis of the risks. I strongly suggest that you meet with your financial advisors before you make a decision to purchase this type of product. Finally, consider the following final notes:
1. longevity insurance products are not for everyone and should be carefully reviewed before you sign any documents to ensure that they meet your specific needs, and
2. when choosing this type of insurance product, you're buying income that that will start in for 20 years or more. Therefore, make sure that company being considered has a good reputation and solid financials. You can check a company's credit rating with services like Standard & Poor's and A.M. Best.
One of the main concerns of many individuals approaching the retirement age is the valuation of their current retirement savings and how to catch up. One solution is to increase the risk to and exposed your retirement account to equities in order to bring enough growth in the portfolios. However, this can come at a costly price. One solution to consider is a longevity insurance product. These longevity insurance products are effective in combination with an investment strategy. With a guaranteed income starting at a predetermined point in time, you'll basically take the biggest unknown out of your retirement-planning strategy; "how long your money should last?". You could be more aggressive with your investments and fine-tune the size of your withdrawals without the fear of running out of money.
Recently Mr. Peng Chen, Morningstar’s president of the investment management division, reported the following:
1. many investors do not estimate how long they will live and end up shorthanded on retirement funds.
2. people who are overly optimistic about how long they will live may have a too-frugal existence in retirement.
3. roughly half of retirees live longer than their life expectancy.
4. financial markets are far more volatile than many financial planners account for, and
5. retiree’s exposure to stocks and bonds can put their retirement savings at risk.
One alternative is to combine a traditional product like a mutual fund in combination with a longevity insurance product. As an investor you should consider when saving for your retirement the following:
1. age
2. financial market risk tolerance
3. retirement expenses
4. longevity, and
5. bequest goals
If you're someone who is concerned with the possibilities of outliving your savings, you may want to consider longevity insurance. However, this must be done with careful analysis of the risks. I strongly suggest that you meet with your financial advisors before you make a decision to purchase this type of product. Finally, consider the following final notes:
1. longevity insurance products are not for everyone and should be carefully reviewed before you sign any documents to ensure that they meet your specific needs, and
2. when choosing this type of insurance product, you're buying income that that will start in for 20 years or more. Therefore, make sure that company being considered has a good reputation and solid financials. You can check a company's credit rating with services like Standard & Poor's and A.M. Best.
August 10, 2011
Warning: Check Your Beneficiary Designations
Here is something that many people do not think about; including poorly trained financial advisors. With federal tax exemption at $5 million, many are not be thinking about their estate planning at the moment. Big mistake!
How many of you have looked at your beneficiary designations in the last 3 years for your:
* bank accounts,
* brokerage firm accounts,
* retirement accounts,
* company benefit plans,
* life insurance policies,
* annuities and
* 529 college accounts.
I am almost certain that most of the people reading this will have to honestly say they have not. If you haven't submitted your designate beneficiaries forms, do it NOW!. If your forms are outdated, update them NOW!. This is something serious and should be something that is discussed with your financial planner as part of your annual financial checkup. However it is commonly overlooked.
It is sad to see families losing to their entitled benefits due to forms with outdated addresses, beneficiaries, etc and creating unnecessary headaches for the families. It is sad to see the horror stories of many of these families. Just imagine your ex-spouse being the one receiving your company pension funds proceeds. Here is a warning to you; The U.S. Supreme Court ruled that the beneficiary designations trumped state law that would have automatically disinherited the ex. So she got the money, and the kids got the bills for an unsuccessful legal fight.
In another case, The US Supreme Court ruled in favor of an ex-spouse collecting $400,000 from a savings and investment plan from her former husband. What makes this case interesting is that as part of the divorce decree (signed seven years prior to his death) stipulated that the ex-wife "waived any interest in the plan". The man failed to update the beneficiary forms to make the necessary updates and transfer the beneficiary rights to his daughter which was his wish. The plan document stipulated that beneficiaries could only be changed by submitting the form. Once again the U.S. Supreme Court ruled that the outdated beneficiary designation trumped the divorce agreement.
Conclusion, do not depend on your will to override outdated beneficiary designations. If you want your life insurance proceeds to go to your church after your death, you must update your beneficiary designation forms. As a general rule, whoever is named on the most recent beneficiary form (which may not be nearly recent enough) will get the money automatically if you die -- regardless of what your will might say.
How many of you have looked at your beneficiary designations in the last 3 years for your:
* bank accounts,
* brokerage firm accounts,
* retirement accounts,
* company benefit plans,
* life insurance policies,
* annuities and
* 529 college accounts.
I am almost certain that most of the people reading this will have to honestly say they have not. If you haven't submitted your designate beneficiaries forms, do it NOW!. If your forms are outdated, update them NOW!. This is something serious and should be something that is discussed with your financial planner as part of your annual financial checkup. However it is commonly overlooked.
It is sad to see families losing to their entitled benefits due to forms with outdated addresses, beneficiaries, etc and creating unnecessary headaches for the families. It is sad to see the horror stories of many of these families. Just imagine your ex-spouse being the one receiving your company pension funds proceeds. Here is a warning to you; The U.S. Supreme Court ruled that the beneficiary designations trumped state law that would have automatically disinherited the ex. So she got the money, and the kids got the bills for an unsuccessful legal fight.
In another case, The US Supreme Court ruled in favor of an ex-spouse collecting $400,000 from a savings and investment plan from her former husband. What makes this case interesting is that as part of the divorce decree (signed seven years prior to his death) stipulated that the ex-wife "waived any interest in the plan". The man failed to update the beneficiary forms to make the necessary updates and transfer the beneficiary rights to his daughter which was his wish. The plan document stipulated that beneficiaries could only be changed by submitting the form. Once again the U.S. Supreme Court ruled that the outdated beneficiary designation trumped the divorce agreement.
Conclusion, do not depend on your will to override outdated beneficiary designations. If you want your life insurance proceeds to go to your church after your death, you must update your beneficiary designation forms. As a general rule, whoever is named on the most recent beneficiary form (which may not be nearly recent enough) will get the money automatically if you die -- regardless of what your will might say.
Estate Planning With A Christian Base
Most people avoid the subject of estate planning due to their fear to death. However, Christians avoid the subject due to taboos/misunderstandings that still exists about the subject on money and accumulation of wealth in the Christian community. However, as followers of Jesus Christ, we need a different view and understanding about estate planning with a Christian base. As Christians we must view estate planning as an important act of our stewardship.
References to estate planning are found throughout the bible, starting from Genesis 15 when Abraham expresses to God his concern over his lack of an heir. Wanting to take matters on his own hand, he goes outside God’s plan and conceives an heir with his wife’s servant, Hagar (Genesis 16). Later we see how Abraham creates a plan that is pleasing to the Lord, and it is recorded in Genesis 25:5-6 as the first recognizable estate plan—after giving gifts to each of his other children, Abraham then gives the remainder of his possessions to Isaac. In the Gospel of John we are provided Jesus’ estate plan. While hanging on the cross, Jesus hands over the care of his mother to a trusted friend.
As Christians we are taught from the beginning that God owns everything, and this includes everything titled in our name. Throughout the Bible we are called stewards (managers) of the assets the Lord has given us. From the beginning of Bible we are called to oversee those assets for and on His behalf. Therefore, the preparation of an estate plan actually serves as the distribution clause for the assets He has entrusted to us. Estate planning should be part of Christian stewardship program. The Lord expects us to manage the assets God gives to us for management with the conviction that they belong to Him. Therefore, this requires not only the proper management of the assets during our life; it also requires that those assets are properly passed to the next generation to continue expanding his plan and kingdom.
It is possible that you do not realize it, but the lack of an estate plan is against our stewardship role that our Lord has called upon us. Make sure that your estate plan is prepared in accordance with Christian principles. Finally make sure that your estate planning advisor is properly trained and prepared to advise you and execute your instructions after you are called to join our Lord.
References to estate planning are found throughout the bible, starting from Genesis 15 when Abraham expresses to God his concern over his lack of an heir. Wanting to take matters on his own hand, he goes outside God’s plan and conceives an heir with his wife’s servant, Hagar (Genesis 16). Later we see how Abraham creates a plan that is pleasing to the Lord, and it is recorded in Genesis 25:5-6 as the first recognizable estate plan—after giving gifts to each of his other children, Abraham then gives the remainder of his possessions to Isaac. In the Gospel of John we are provided Jesus’ estate plan. While hanging on the cross, Jesus hands over the care of his mother to a trusted friend.
As Christians we are taught from the beginning that God owns everything, and this includes everything titled in our name. Throughout the Bible we are called stewards (managers) of the assets the Lord has given us. From the beginning of Bible we are called to oversee those assets for and on His behalf. Therefore, the preparation of an estate plan actually serves as the distribution clause for the assets He has entrusted to us. Estate planning should be part of Christian stewardship program. The Lord expects us to manage the assets God gives to us for management with the conviction that they belong to Him. Therefore, this requires not only the proper management of the assets during our life; it also requires that those assets are properly passed to the next generation to continue expanding his plan and kingdom.
It is possible that you do not realize it, but the lack of an estate plan is against our stewardship role that our Lord has called upon us. Make sure that your estate plan is prepared in accordance with Christian principles. Finally make sure that your estate planning advisor is properly trained and prepared to advise you and execute your instructions after you are called to join our Lord.
August 9, 2011
Warning Against Financial Investment Scams
Today I want to address those of us that have chosen the advisory profession as well as those who seek professional advise. The current environment has created the perfect scenario for scammers to attack a fragile niche; the retirement market. With 10,000 baby boomers turning 65 every day it is an attractive niche for them to target. According to a recent study by Metlife, elder fraud is a problem of approximately $3 billion per year. These scam artists prepare their sleek marketing materials and spoon feed these information to the untrained financial advisors, who then presents this information to their clients causing not only damages to thousands of families, it also destroys professional careers.
Due to the decline in asset values that many of the baby boomers have suffered in their retirement accounts in the past few years, they have an urgent need to catch up in their financial plans. This is understandable and provides the opportunity for predators. Also, poorly trained financial advisors feeling the need to bring new products/alternatives to their client fall victims of these well trained predators.
The problem we are encountering is that many of these non-traditional investments are unregistered products. They come in different shapes and forms, however the main goal is to create the illusion of legitimacy. Some examples of these unregistered products are:
1. unregistered limited partnerships
2. hedge funds
3. oil & gas deals
4. real estate products
Some times above products are legitimate and well founded. However, the investment decisions should always be made on a sound analysis of the investment potential. As financial advisors, extensive due diligence must be performed to ensure that the products being presented meet the risk assessment and financial plan of the clients. Financial advisors must not think that they are "too smart to fall for anything like that". Financial advisors must exercise a healthy level of skepticism. If the financial advisor starts from the premise that these guys are legitimate, it takes almost no effort for them to confirm the "legitimacy" of the products being presented. Financial advisors must start from what I call a healthy level of skepticism; start from the basis that this could be a scam, then perform due diligence and leave no rock unturned and if after looking under all the rocks the financial advisor cannot find evidence of fraud, then and only then we can feel that the deal is OK and could be presented to the appropriate clients. Furthermore, it is important that you as the client of the financial advisor be comfortable with the understanding of the products by your financial advisors. Is He/She well prepared on the subject matter? Does the company that they represent have a solid background? Has your financial advisor performed sufficient due diligence on the opportunity/product before being presented to you? Is your financial advisor keeping up with the required training? With clients still wincing from the declines of 2008, faith and trust is running low. While there are benefits to alternative investment programs, they should only be implemented after performing diligence to ensure the trust of our clients bestowed in us continues to be well deserved.
Due to the decline in asset values that many of the baby boomers have suffered in their retirement accounts in the past few years, they have an urgent need to catch up in their financial plans. This is understandable and provides the opportunity for predators. Also, poorly trained financial advisors feeling the need to bring new products/alternatives to their client fall victims of these well trained predators.
The problem we are encountering is that many of these non-traditional investments are unregistered products. They come in different shapes and forms, however the main goal is to create the illusion of legitimacy. Some examples of these unregistered products are:
1. unregistered limited partnerships
2. hedge funds
3. oil & gas deals
4. real estate products
Some times above products are legitimate and well founded. However, the investment decisions should always be made on a sound analysis of the investment potential. As financial advisors, extensive due diligence must be performed to ensure that the products being presented meet the risk assessment and financial plan of the clients. Financial advisors must not think that they are "too smart to fall for anything like that". Financial advisors must exercise a healthy level of skepticism. If the financial advisor starts from the premise that these guys are legitimate, it takes almost no effort for them to confirm the "legitimacy" of the products being presented. Financial advisors must start from what I call a healthy level of skepticism; start from the basis that this could be a scam, then perform due diligence and leave no rock unturned and if after looking under all the rocks the financial advisor cannot find evidence of fraud, then and only then we can feel that the deal is OK and could be presented to the appropriate clients. Furthermore, it is important that you as the client of the financial advisor be comfortable with the understanding of the products by your financial advisors. Is He/She well prepared on the subject matter? Does the company that they represent have a solid background? Has your financial advisor performed sufficient due diligence on the opportunity/product before being presented to you? Is your financial advisor keeping up with the required training? With clients still wincing from the declines of 2008, faith and trust is running low. While there are benefits to alternative investment programs, they should only be implemented after performing diligence to ensure the trust of our clients bestowed in us continues to be well deserved.
August 4, 2011
The Importance of LTC Insurance as Part of Your Wealth Development Program
Many of us take for granted the good health we are currently enjoying, that is truly a blessing. Thank you to advancements made in the medical industry we are living longer. However, as we age our health continues to deteriorate. It is a fact of nature. Therefore, as we continue to age we all should plan for our senior years and the proper care during those years so we continue to enjoy life. What is certain is that our aging population, at some point, will require long-term care. Let me demonstrate a realistic scenario in our lives:
John and Jane Smith have addressed their retirement planning for the most well. Even with the recent economic situation they have a well established nest egg for their upcoming planned retirement. John is 62 and a retired accountant for the last two years, who enjoys playing golf; eventhough recently his health has not allowed him to enjoy the last couple of rounds. Jane is 58 accounting manager at a distinguished manufacturing company. She is getting ready for her planned retirement within the next 24 months. Financially speaking, John and Jane have been doing well. However, last week John was diagnosed with Parkinson’s disease. This news has Jane worrying about the care John will need and the strain this will place on their retirement savings and her current earnings.
The above scenario is a best case scenario, John and Jane have retirement savings they have developed over the years and Jane is still gainfully employed. People like John will often require home-care or 24-hour nursing care provided by a long-term care facility. The cost for long-term care is expensive and financially draining to a family. Without government assistance, many are questioning what other options are available. Long term care insurance helps provide funds for looking after a family member who is not unwell in the regular sense of the word but is still unable to go about a daily existence without help. This can include an individual requiring help walking to Alzheimer and Parkinson.
If John had LTC Insurance coverage, his policy might cover his residency in a nursing home or in a retirement home. He might also have access to any of the following: home care, adult care, respite care, and hospice care. Additionally, under his LTCI, John may be covered, for activities of daily living and stand-by assistance. All of these, can be very costly and can quickly deplete through a person’s and/or family’s savings.
The scenario above is a common one. During our financial planning one of the most common overlooked areas is long-term care. Why?
1. Denial - many people are confident they won’t get any illness or disability even if they become older.
2. Fear - people don’t want to think and become stressed with the problems that aging and long term care could bring. Also, they also avoid becoming a burden to their loved ones and families so they choose to handle this problem alone and never ask help from anyone.
3. Unaware of the true cost of LTC - many people do not understand how expensive long term care is these days and in the future.
4. Misinformed - Most Americans also think that Medicaid and Medicare will take care of the bills the time when they get in a nursing home; Medicaid and Medicare help only the low income and require those with extra assets to spend it down before they qualify for benefits in many cases causing unnecessary tax burden to the family.
Here are seven reasons why you should include LTC Insurance as part of your wealth protection program:
1. Numerous options - one advantage of long-term care insurance is that it covers a wide variety of options which can range from daycare for adults, care and taking care of for short periods, care in the hospital or retirement home, provide facilities care for Alzheimer's, home care etc .
2. Immediate help - Help is available from the first day of need itself. Depending on the policy benefit, a care giver can live in the house of the person requiring help. It'll also pay for a specialist, housekeeper, companion, caregiver and non-public nurse to go to the person needing help or stay for a few hours or days too.
3. Family savings remain secure - there isn't any need to touch family savings if a family member needs long term help. The Insurance will help cover most expenses if not all. Without insurance, the cost of providing long term care or perhaps care to a relation on a weekly basis can be terribly dear.
4. Tax repayments and inflation adjustment - Depending on the policy details, premium for long term care insurance are counted for all sorts of tax deductions. The advantages from the insurance aren't counted as earnings either. Also, an inflation adjustment actually helps increase the value of your premium.
5. Security - The sense of security is far greater in case of the insured person requiring help.
6. Daily allowance - a specific daily allowance can be opted for instead of bigger payments at longer intervals. However, this must be balanced with the premiums because the bigger the quantity of daily allowance you choose, the higher will be the premium payment.
7. Estate planning - By purchasing a policy, you not only accrue funds that would later cover long-term care costs but also preserve a portion of your money that can be put towards the cost of taxes payable on death, building an inheritance for your children and wealth preservation.
Before you choose a long term Care policy review what flexibility options are offered. LTC insurance offers many options from managed living, adult day care center, care home or home as a setting for the care that could need to be provided. Long-term care is a complex and misunderstood area of financial planning where it is easy to make costly mistakes. Deciding on an LTC insurance policy can be frustrating and confusing when handled alone. Therefore, it is important that your professional advisor be well versed in this area to properly advise you in the policy that is best for you.
John and Jane Smith have addressed their retirement planning for the most well. Even with the recent economic situation they have a well established nest egg for their upcoming planned retirement. John is 62 and a retired accountant for the last two years, who enjoys playing golf; eventhough recently his health has not allowed him to enjoy the last couple of rounds. Jane is 58 accounting manager at a distinguished manufacturing company. She is getting ready for her planned retirement within the next 24 months. Financially speaking, John and Jane have been doing well. However, last week John was diagnosed with Parkinson’s disease. This news has Jane worrying about the care John will need and the strain this will place on their retirement savings and her current earnings.
The above scenario is a best case scenario, John and Jane have retirement savings they have developed over the years and Jane is still gainfully employed. People like John will often require home-care or 24-hour nursing care provided by a long-term care facility. The cost for long-term care is expensive and financially draining to a family. Without government assistance, many are questioning what other options are available. Long term care insurance helps provide funds for looking after a family member who is not unwell in the regular sense of the word but is still unable to go about a daily existence without help. This can include an individual requiring help walking to Alzheimer and Parkinson.
If John had LTC Insurance coverage, his policy might cover his residency in a nursing home or in a retirement home. He might also have access to any of the following: home care, adult care, respite care, and hospice care. Additionally, under his LTCI, John may be covered, for activities of daily living and stand-by assistance. All of these, can be very costly and can quickly deplete through a person’s and/or family’s savings.
The scenario above is a common one. During our financial planning one of the most common overlooked areas is long-term care. Why?
1. Denial - many people are confident they won’t get any illness or disability even if they become older.
2. Fear - people don’t want to think and become stressed with the problems that aging and long term care could bring. Also, they also avoid becoming a burden to their loved ones and families so they choose to handle this problem alone and never ask help from anyone.
3. Unaware of the true cost of LTC - many people do not understand how expensive long term care is these days and in the future.
4. Misinformed - Most Americans also think that Medicaid and Medicare will take care of the bills the time when they get in a nursing home; Medicaid and Medicare help only the low income and require those with extra assets to spend it down before they qualify for benefits in many cases causing unnecessary tax burden to the family.
Here are seven reasons why you should include LTC Insurance as part of your wealth protection program:
1. Numerous options - one advantage of long-term care insurance is that it covers a wide variety of options which can range from daycare for adults, care and taking care of for short periods, care in the hospital or retirement home, provide facilities care for Alzheimer's, home care etc .
2. Immediate help - Help is available from the first day of need itself. Depending on the policy benefit, a care giver can live in the house of the person requiring help. It'll also pay for a specialist, housekeeper, companion, caregiver and non-public nurse to go to the person needing help or stay for a few hours or days too.
3. Family savings remain secure - there isn't any need to touch family savings if a family member needs long term help. The Insurance will help cover most expenses if not all. Without insurance, the cost of providing long term care or perhaps care to a relation on a weekly basis can be terribly dear.
4. Tax repayments and inflation adjustment - Depending on the policy details, premium for long term care insurance are counted for all sorts of tax deductions. The advantages from the insurance aren't counted as earnings either. Also, an inflation adjustment actually helps increase the value of your premium.
5. Security - The sense of security is far greater in case of the insured person requiring help.
6. Daily allowance - a specific daily allowance can be opted for instead of bigger payments at longer intervals. However, this must be balanced with the premiums because the bigger the quantity of daily allowance you choose, the higher will be the premium payment.
7. Estate planning - By purchasing a policy, you not only accrue funds that would later cover long-term care costs but also preserve a portion of your money that can be put towards the cost of taxes payable on death, building an inheritance for your children and wealth preservation.
Before you choose a long term Care policy review what flexibility options are offered. LTC insurance offers many options from managed living, adult day care center, care home or home as a setting for the care that could need to be provided. Long-term care is a complex and misunderstood area of financial planning where it is easy to make costly mistakes. Deciding on an LTC insurance policy can be frustrating and confusing when handled alone. Therefore, it is important that your professional advisor be well versed in this area to properly advise you in the policy that is best for you.
August 1, 2011
How Do You Define Wealth?
When I talk to business owners and families, one to the most interesting experiences for me is when I ask them "How do you define wealth?". What comes to your mind? The answer to this simple question varies from “Wealth is an illusion", "Wealth is the root of all evil", "Wealth is hard to achieve" to "Wealth is fun and achievable". The answer is conditioned on our beliefs and experiences.
One that tends to strike me the most is the misunderstanding that "money is the root of all evil". Many people, including Christians, believe that bible says that money is the root of all evil. However, this is perhaps the most misquoted verse of the bible ever. The Bible actually says, “The love (or worship) of money is the root of all evil.” (1 Timothy, 6:10). Huge difference!
The way you answer this simple question is paramount to your goal of achieving wealth in your life. Many times you hear people saying that they want to become wealthy, but they define wealth as something that is bad/evil/painful. Others define wealth as being rich, were the focus is the amount of money that is accumulated without regards to other aspects of life or methods used to achieve it.
What are your beliefs about wealth? What about wealthy people? Are they just like you and I? Or, is wealth reserved for other "Special people"? For example, did you receive messages growing up, like many of us during our childhood, that rich people were those “other people” and not like us or our friends. Or did you have wealthy friends and family in your life? T. Harv Eker in his book "Secrets of the Millionaire Mind" he points out, we are all living out our parents wealth blueprint or script, until we have actively done something to change it. We inherit from our parents their good qualities as well as the bad. Many will acquire their “laissez faire” attitude about credit cards and their philosophy of “spend now, worry later”.
Until you decide to take charge of your finances and challenge your beliefs about money and wealth, you will simply be carrying on what you learned growing up. You will be living your parent’s wealth script, which may not be a good idea. The sad thing is, they were doing the same thing their parents did and so on and your future generations will be doing the same thing.
Early money experiences set the stage for your current beliefs about the subject of wealth and how it relates to you. If you want to achieve wealth, you have to begin creating positive associations around the idea. You need to begin seeing yourself as “one of those wealthy people” BEFORE you can become one. The secrets of achieving anything in life is:
1. Be - See yourself being that person.
2. Do - Do the things that person would do.
3. Have - As you get comfortable being the wealthy person and doing what wealthy people do, then you will have wealth.
However, most people get it backwards. They think after I have money, then I’ll do good things and I’ll be the kind of person I want to be. It does not work that way. Remember, first be, then do, you will then have.
Share with me, your views on wealth. How would you answer this question?
One that tends to strike me the most is the misunderstanding that "money is the root of all evil". Many people, including Christians, believe that bible says that money is the root of all evil. However, this is perhaps the most misquoted verse of the bible ever. The Bible actually says, “The love (or worship) of money is the root of all evil.” (1 Timothy, 6:10). Huge difference!
The way you answer this simple question is paramount to your goal of achieving wealth in your life. Many times you hear people saying that they want to become wealthy, but they define wealth as something that is bad/evil/painful. Others define wealth as being rich, were the focus is the amount of money that is accumulated without regards to other aspects of life or methods used to achieve it.
What are your beliefs about wealth? What about wealthy people? Are they just like you and I? Or, is wealth reserved for other "Special people"? For example, did you receive messages growing up, like many of us during our childhood, that rich people were those “other people” and not like us or our friends. Or did you have wealthy friends and family in your life? T. Harv Eker in his book "Secrets of the Millionaire Mind" he points out, we are all living out our parents wealth blueprint or script, until we have actively done something to change it. We inherit from our parents their good qualities as well as the bad. Many will acquire their “laissez faire” attitude about credit cards and their philosophy of “spend now, worry later”.
Until you decide to take charge of your finances and challenge your beliefs about money and wealth, you will simply be carrying on what you learned growing up. You will be living your parent’s wealth script, which may not be a good idea. The sad thing is, they were doing the same thing their parents did and so on and your future generations will be doing the same thing.
Early money experiences set the stage for your current beliefs about the subject of wealth and how it relates to you. If you want to achieve wealth, you have to begin creating positive associations around the idea. You need to begin seeing yourself as “one of those wealthy people” BEFORE you can become one. The secrets of achieving anything in life is:
1. Be - See yourself being that person.
2. Do - Do the things that person would do.
3. Have - As you get comfortable being the wealthy person and doing what wealthy people do, then you will have wealth.
However, most people get it backwards. They think after I have money, then I’ll do good things and I’ll be the kind of person I want to be. It does not work that way. Remember, first be, then do, you will then have.
Share with me, your views on wealth. How would you answer this question?
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