🛡️ Building Wealth that Lasts

Quick Update

Long-time readers may notice that this email doesn’t look the same as usual.

No, I didn’t lose my template, I changed email providers.

I have swapped from Constant Contact to Beehiiv, and so far, I’m loving it.

Plan on seeing this new format in the future, barring a catastrophe.

Why Worry About the Long Term?

As humans, we tend to think in the short term.

What will I have today? How much do I have today? What can I buy today?

However, what we all really want is to live a life of freedom.

To live that kind of life, you need to be thinking long-term. Think 10, 20, 30 years out. By that time, you want to be able to be free enough to work when you want, where you want, or not at all.

Buying those new fancy shoes today may seem important. But in reality, living a life where you live on your own terms is more important, even if you don’t realize it yet.

For many people, the long term may also be future generations. To have anything to pass down to your children, you need to have effectively protected your wealth.

Isn’t Making Money Enough?

The traditional wealth-building path says to make money from your day job and you’re set. Keep all of that money in cash or a savings account and you’re golden.

Money sitting by itself is also left unprotected from theft. If you keep all of your savings in a single place, you can go broke from a single mishap.

Level 1: Growth

The first and most obvious method to protect your wealth is to generate more of it.

I won’t spend too much time on this but things like getting a raise or bonus, investing, starting a side hustle, or increasing your profits are all great ways to generate more wealth.

All of these methods will simply pile onto your walls of money so you don’t notice the leak of inflation as much.

This is a great start, but it’s sort of like trying to fix a leaking bucket by pouring more water into it. You have to put in the effort to continue pouring, trying to outpace the leak.

Bonus if you generate wealth through tax-advantaged means such as retirement accounts.

Level 2: Recurring Passive Income

This level is similar to the first. However, the key difference is the passive aspect.

This is like someone else coming in to help you fill your bucket, with no effort on your part, while you continue to put in work.

As for your wealth, recurring passive income usually comes from:

• Stock dividends

• Rental income (assuming someone else manages the property)

Both of these forms of income will add to your active income (day job), working for you even when you stop.

As a bonus, this will protect you even when you retire. You will still continue to receive and compound dividends even after you stop working.

One of the best ways to add investment diversification is through real estate crowdfunding. My favorite platform for this is Arrived. With a minimum deposit of $100 and great residential housing options, start earning rental income and appreciation returns without the headache of managing tenants yourself.

If this sounds like a good fit for your portfolio, you can easily sign up here. Feel free to start off by just entering your email and getting a feel for the platform before depositing money. Get the ball rolling.

Level 3: Diversification

Now we can take a step towards truly protecting your wealth.

In terms of wealth, diversification means spreading out your wealth over multiple platforms, sources, and/or sectors to protect from a single failing platform, source, or sector.

Let’s go back to the water bucket analogy. Imagine someone is randomly shooting a hole in your buckets. If you have all your water in one bucket like we did before, and they happen to shoot that one bucket, game over.

If, instead, we spread our water across several buckets, even if we lose some from one bucket, the others are safe.

In finances, this can mean:

• Investing in an ETF or multiple individual stocks

• Generating income from multiple sources

• Holding wealth in multiple types of assets (real estate, stocks, bonds, etc.)

Any or all of these methods will spread out your water (wealth) over more and more buckets. This will protect your wealth for decades to come.

Level 4: Build a Business/Brand

The big kahuna. The most difficult to achieve but also the most effective.

Building a business or brand is not only the most lucrative, fulfilling level 1, but it can also become extremely passive if properly set up, fulfilling level 2.

Books like The 4-Hour Work Week outline how you can build a business towards requiring as little input from you as possible.

Regardless of how you build your business, you can protect your wealth behind the walls of an LLC and external assets.

If you’re able to take advantage of level 4, you’ll be far better off.

If you’re interested in more personal assistance with these kinds of topics, I now offer:

• FREE Money Minute Call (quick questions, 15 min)

• Investing Foundations Coaching (30 min)

• Wealth-Building Coaching (45 min)

• Excel Consultation (1 hr)