SOLVING THE PROBLEM – LIVING THE BEST LIFE YOU CAN NOW

First, you should be congratulated for some of the past decisions you have made in your life. With the information you had at that time, you probably made the best decision you could base on that information. Now – with more information, knowledge, and wisdom – you may want to rethink some of the decisions you have made.

TAKING ACTION TO IMPROVE YOUR LIFE – YOUR ASSETS

Understanding that just about every attempt to accumulate money in the future will be surrounded by risk, taxes, penalties (government regulations) and will lose buying power due to inflation and depreciation of the dollar, it will become important to discover that there are many things in your life that have value. You may be aware of some of the typical traditional financial products and possessions that you have, such as IRAs, 401(k)s, STOCKS, MUTUAL FUNDS, BANK SAVINGS PROGRAMS, ANNUITIES, your HOME and/or REAL ESTATE, GOLD, SILVER, ETC. It is very important to list all the assets you have and then discover how these assets work in your life. Take each of these assets and apply to 12 litmus-test questions of The Money Matrix discussed in the previous chapter and compare how your assets compare to your most perfect investment. You may come to the conclusion that many of the assets you have currently are a far cry from the investment that you would like.

In listing your assets, you should also consider some non-traditional assets such as the value of your family. You must now begin to view your family, your whole family, as a financial entity. You should consider any inheritances that may be possible inside your family. The value of your family should be insured and assured into the future. The value of your family should be insured and assured into the future. The family could possibly be an asset, with the right discussions and professional planning, and can increase in the value and result in tax-free dollars in the future. Inheritances and designed gift giving inside the family are discussions every family should have. The average inheritance in the United States today, upon the death of the second parent, is about $47,000. With the right discussion and preparation, that figure of $47,000 in an inheritance could be increased tremendously and could also be tax-free future dollars. The rich consider this conversation and planning pivotal to their financial success. They understand that if the financial success of the family is assured in the future then they can live the best life they can, today. The family legacy will not be a fit for every family; a qualified professional can guide you through the discussion to see if your family meets the criteria for its use.

Other assets that can be leveraged (increase in value) are businesses you may own and life insurance. With both assets, you have direct control over their value and future success. Both assets focus on the idea of ​​using the least amount of money to generate the greatest profit or financial benefit.

The first step to any plan is to understand the assets that are at your disposal and how to use them as tools to build your financial future. All too often, financial products can be disguised as the solutions in your financial life. You must understand that everything in your life has value, and you must discover the assets in your life you control and can drive forward. It is important to discover a list of all your assets. After all, how can you get to where you want to go when you don’t know where you’re at?

YOUR TRANSFERS

As we discussed throughout this book, many Americans, unknowingly and unnecessarily, transfer away much of their wealth. Once again, taxes, risks, penalties, inflation, and depreciation of the dollar are major concerns in everyone’s effort to maintain their lifestyles and plan for the future. These elements are difficult to control. But there are other aspects of your life that you do, and can, control. The way that your money flows in and out of your life many times is based on choices that you made. Understand that if you have the power to make these choices, you may also have the power to change your choices. What will determine the choices you make will be a direct result of what you know at the time of your decision. With more information, knowledge and understanding of the economic trends and shifts that will impact your life, and finally discovering how money works in your life, you may want to rethink some of the decisions you made in the past. Recapturing transfers of wealth in your life will be a direct result of what you know about how money works. Wisdom is recognizing changes need to be made.

After listing all your assets, study them carefully. Many of them contain transfers of wealth, taxes, fees, charges, penalties, interest, risk of loss, etc. It is very possible to eliminate many of these transfers in your life now and in your future. If you understand the elements that are hurting you financially, then you can avoid them and recapture money that you are giving away, unknowingly and unnecessarily.

In finding the solutions in your financial life, the first two steps of listing your assets and recognizing your transfers of wealth contained in some of these assets could lead to exciting discoveries and more options and opportunities.

APPLYING A NEW THOUGHT PROCESS

Knowledge is something you learn; wisdom is the ability to apply that knowledge to your everyday life. Many of today’s so-called solutions to your everyday challenges also continue to feed the financial problems that you would like to avoid in the future. Recognizing the challenges is the first step to solving the problem.

First, you must understand the five challenges that will impact and dominate your lifestyle, your ability to save and your attempt to plan your retirement. These five elements are:
Risk-Taxes – Government Regulations (penalties) – Inflation – The Value of the Dollar

THE DEFINING MOMENT

In solving these problems and challenges you will face, you were asked to list all the things in your life that have value. Next, be aware that all of the assets you have listed may have transfers of wealth you can avoid. Now that you understand these challenges, it’s time to apply a new thought process in solving the problems. The center point to this new thought process is the first two defining moments. Your money will never be worth more than it is today. AND, the tax bracket you are currently in may be the lowest tax bracket you will be in for the rest of your life.

For many, understanding these two defining moments will change your approach to everything you were trying to accomplish, financially. Should you be deferring taxes toa a later date? Should you be paying your mortgage as fast as you can? Are taxes going to be higher or lower in the future? Is it realistic to believe that you will retire to a lower tax bracket? Will inflation and depreciation eat away at your standard of living and your ability to save? You may discover that answering these questions will give you a new perspective in your thought process.

ASSET ANALYSIS – YOUR MATRIX

As part of your discovery, you should have a list of all your assets. Previously, we discussed all the attributes that you would want if you could create your most perfect investment. Now take all the assets you currently have and ask the following questions:
– Does this asset have a lot of risk involved?
– Does this asset have guarantees?
– Does this asset have penalties attached to it?
– Does this asset allow me to get to my money whenever I need it?
– Is this asset protected from creditors?
– Does this asset create the most amount of wealth or benefit using the least amount of money?
– Does this asset grow tax-deferred?
– Is this money in this asset distributed to me tax-free?
– Can I use this asset as collateral for other things I want to do?
– Are my deposits in the asset tax-deductible?
– Does this asset provide for payments into my investment to continue even if I become disabled?
– In the event of my death, does this asset go to my family tax-free?

You may discover that many of the assets you currently have are not as favorable as you would like them. This is a great exercise to help you discover how money works in your life. You also may now begin to understand how traditional thinking continues to “feed the problem” you face in the future, instead of actually solving the problem. Understand that the defining moments, the 10 transfers of your wealth and the money matrix should be center points of conversations that you should have with any planner.

PAYING ATTENTION TO ECONOMIC TRANDS AND SHIFTS

What you know today will be a determining factor of where you will be financially five to 10 years from now. The economic trends and shifts will play a key role in your future financial success. Remember, the future success of financial products that you own will be determined not by the product itself but by the economic trends and shifts surrounding that product. So, it makes sense to pay more attention to the economic trends and shifts and how these events will impact the products than studying past performances of the products themselves. One source of studying trends and shifts is to watch the government. The government will cause more havoc with your future dollars than you can imagine. The government’s actions will directly impact on taxes you must pay, inflation on the products you buy, the risk you must take to save future dollars, the penalties you must pay and the depreciation of the value of your standard of living.

“You can be young without money, but you can’t be old without money.” – Tennessee Williams

“Too many people spend the money they haven’t earned . . . to buy things they don’t want . . . to impress people they don’t like. Will Rogers.

This educational material is provided by the Wealth & Wisdom Institute.

“You can be young without money, but you can’t be old without money.” – Tennessee Williams
“Too many people spend the money they haven’t earned . . . to buy things they don’t want . . . to impress people they don’t like. Will Rogers.

This educational material is provided by the Wealth & Wisdom Institute.