How to build the wealth you want FASTER.
Getting rich overnight would be a dream, but more than likely it’s going to take you some time to build the financial picture of your dreams.
But that doesn’t mean there aren’t proven strategies to get you there faster and easier.
(In fact, most billionaires have already implemented these.)
Tune in to the latest podcast episode to discover exactly what these strategies are so you can start using them to your advantage.
Get all the details here.
Hey there. Welcome back to the Heart of Your Money podcast this week. Let’s dream. You are a billionaire. What are you doing with your money right now?
Most billionaires take years to create their wealth. It doesn’t happen overnight. It takes good decisions and some good investments. Now, you might not have billions to your name, but there are things we can do to copy those ultra-wealthy and get ahead.
They work hard for their money. We work hard for our money. They wanna protect it and make more. Same here. So let’s do the same thing. I’m gonna share five things that billionaires are doing and we should be doing.
Number one: They diversify. There’s proven research to not put all your eggs in one basket. That means making sure your money is spread out among different allocations. Diversify by region, different stocks, mix of different assets. The 1991 Nobel Prize was given to a group of three researchers that confirmed that we can increase returns and reduce risk through the use of strategic asset allocation.
What that means, in very simple terms, is diversify, diversify, diversify. They also revealed that the choice of an individual stock is among the least significant factors— about a 3% impact on overall return. So it’s about those micro-decisions ongoing and diversification.
Second thing billionaires do that we can do too, they invest in equities. The most affluent understand that equities represent the engine driving and investment portfolio equities will outperform inflation and that is mandatory right now.
The third thing: think tax shelters. Billionaires use tax shelters, and I know where your brain is going right now. The Cayman Islands and hiding money. Now that might be true for some, but they start with the simple tax shelters, the same that you and I can start with. That’s registered savings plans, Tax-free savings Accounts and principal residences, so your home, and a little more complicated, but not for everyone; if I’m talking uber-rich, then let’s include life insurance policies. These are all things that have tax shelters and can be utilized.
Fourth thing that billionaires are doing that we can do too: They have estate plans written down and well thought out. This is so important to keep money in the family and away from a loss to taxes and fees. I mean, we don’t want to give CRA our money, let’s leave the most to our family that we can.
Nearly 90% of the wealthy have an estate plan that includes an up-to-date will. They seem to understand that without a will, their assets will be distributed by the public trustee and then they have lost control. They can’t put it where they want to, so it’s so important to have that will/ estate plan that includes reducing probate fees with planning and having beneficiaries listed. Doing a little bit of that pre-tax planning before something happens.
The other thing they have that we should have too: A power of attorney for financial assets and personal directive for healthcare. It seems from these statistics that the wealthier are not only determined to grow their wealth, they are also determined to preserve it.
A little something for us to think about. If you had hundreds of millions and bought an insurance policy that cost you a million or two, you can afford the cost because you just ensured that upon your death, your children will inherit another 20, 30, or 40 million. That is a great investment to help perpetual wealth.
So, you know, when I buy the odd time I buy a lottery ticket, usually when I’m getting gas or if I’m on a road trip and heading to Alberta or a different city or a small town. When I get gas, I’ll get a lottery ticket and I don’t do it often because I get too excited thinking of one. But that’s when on the drive I do that whole planning of what would I do with that money.
Or if I had a client come to me and they said, you know what? We just won 30, 40 million. What would we do? We would take a million or two out of that and buy an insurance policy so that we could create perpetual wealth as a legacy to the family. So of course, you know, my brain’s already scheming on how to invest like a billionaire.
So number five, the last thing I’ll share that the billionaires are doing: They use a financial advisor. Really good ones, experts, and you can do the exact same thing. According to one study, the wealthier are three and a half times more likely to use the services of a financial advisor than the rest of the population.
Many stated categorically that the advice they received prompted them to take actions that assisted them to becoming wealthy and creating a balanced portfolio. Acquiring equities for their portfolios, investing in managed money. Think about pursuing tax shelters and developing estate plans. We know that with good, proper financial advice, your rate of return versus you doing it on your own can be up to 3% more.
So take these five things and translate them to your own financial strategy. Let’s do the same things the billionaires are. I suggest you think like one and take action with these five steps.
Hope you’ve learned something new today. See you back here next week. Don’t forget, if you need, you can check our website, astrafinancial.ca for show notes, or send me a note with any questions or comments. I’d love to hear from you. Till next time, I’m Zena.