Wealth in Words

“Someone is sitting in the shade today because someone else planted a tree a long time ago.” – Warren Buffett When it comes to conquering the challenge of living financially free you must make saving a priority. In other words, it is essential that you create excess cash reserves to put toward paying down your debts and investing in your future. This can be accomplished through earning more income or, more immediately, by putting a plan in place to minimize expenses. Jim Rohn has a simple formula  for savings that can be used effectively to start growing your reserves. As a result, focusing on saving will train your mind to think about abundance. Focus on all the things you can do with what you have right now. Remember, the more you save the more you will be able to invest and, in turn, you will be able to exploit compounding of interest . Putting your money to work for you is a key element in your quest to acquiring wealth . “The rich invest their money and spend what...

Since their inception in 1993, Exchange Traded Funds  (ETF’s) have increased exponentially in popularity with institutional and retail investors. The advent of ETF’s to the investment landscape is analogous to the introduction of flat-screen TV’s to the home entertainment arena. In other words, in the investment product space ETF’s function like the sleek, flat-screen High Definition TV’s, while their predecessor, the mutual fund, is big and clunky just like an old TV set. Accordingly, record assets have been invested in these products with hardly a sign of slowing down. This relentless demand is being fueled for a few reasons. First, ETF’s cost less than their primitive counterparts, the index fund and mutual fund. The costs to run a fund are ultimately passed onto the investor in the form of an expense ratio and, with mutual funds, additional sales and load fees. Since ETF’s offer a comparable investment strategy to an index fund (that is, both products are built to mirr...

We all know these people. They seem to have an endless amount of money as evident in the way they live, what they own, the places they go on a whim, and by the topics of their conversations. But what are some of the distinguishing characteristics between the truly wealthy and regular people? Moreover, how can regular folks like us who aspire to attain this level of financial freedom make these aspirations a reality? Below are a few key ingredients to understanding how to acquire a mindset for wealth accumulation. First, the wealthy are owners of their assets. From my work experience in wealth management, most high net worth (HNW) investors have acquired wealth through owning a family business. For those of us not born into a family with its own enterprise, you can still think like an owner at your place of employment. As you progress through the corporate ranks your compensation package will begin to include a number of additional income opportunities. For example, corporate e...

Dollar cost averaging is a simple, yet effective investment strategy. In effect, you as an investor contribute a set amount of money to an account to buy a fixed amount of an investment regardless of share price. For example, you can set aside $100 a month to invest into a particular product, thereby averaging out the cost per transaction given the fixed amount contributed over the lifetime of your investment. Using dollar cost averaging will allow for you to begin to accumulate wealth in the stock market just as setting aside a pre-determined amount each month for savings will create a financial safety cushion. Additionally, dollar cost averaging is an excellent way to eliminate trying to time the market, which in most cases can lead to paralysis by analysis. In other words, creating a systematic process for investing can help automate the saving process and focus your thoughts on long-term results. For those of you who are new to investing, dollar cost averaging is ...

In the world of investing Blue Chips are known as large, financially established companies with generally attractive stock prospects. Think of iconic American brands like Disney, Walmart, General Electric, Intel, or Visa. In fact, all thirty of the constituents of the Dow Jones Industrial Average can be considered good examples of Blue Chips. Given the financial well-being of Blue Chip companies, they often pay a tasty dividend that can be just as pleasing to your portfolio as those corn tortilla Blue Chips are to your palette. All joking aside, since Blue Chips are well-established financially they generate excess cash that can be returned to shareholders in the form of a dividend. In some cases, the dividend payment and persistent growth in payouts is the best reason for owning one of these stocks. Furthermore, dividend-rich companies can be used as an alternative to comparable fixed income products in a low interest rate environment. In addition to the stream of divid...