3 keys to doing Wealth Well

11 January 2024, 12:14 am

3 keys to doing Wealth Well

At Finwell Group, we run regular events to help educate our clients on various financial planning and wealth creation strategies.

One of the most popular has been our Wealth Done Well Event.

In this article, we’ll share the three keys to doing wealth well and a little of what we cover in this regular education event.

It all comes down to 3 key areas:

• Mindset
• Knowledge
• Routines.

Let’s dive into these key areas.

 

MINDSET

Starting with mindset, you will find it incredibly empowering if you focus towards a specific goal.

When you have a goal in mind, you can work towards it clearly and effectively. It’s important that you to take the time to clarify your goal and make it real to you so you are excited and passionate about working towards it.

A good goal can transport you into the future where you can feel, see, touch and taste what it will be like to achieve it. In addition, a good goal is one you are willing to sacrifice something to achieve.

For example, you might decide to give up the daily takeaway coffee or some other short-term desire to pay your mortgage down in a shorter time.

On the tough days or the day when it feels like a grind, you can use your goal to continue to inspire you to persist.

Despite what the media portrays with overnight successes and examples of celebrities, we do not live in a magic bullet world. For most of us, it will take effort and you will have to do something to create your wealth.

At Finwell Group, we talk about the concept of EXCHANGE with the following simple formula:

WEALTH = CONTRIBUTION minus CONSUMPTION

What that means is that your Wealth is the sum of the contribution you put in, minus what you consume on the way to getting that wealth.

An example is you want to have a paid-off mortgage in ten years, and you need to contribute $800,000 in work or investment growth whilst spending $500,000 to support your lifestyle, to create the $300,000 ‘gap’ that you need to pay off your mortgage.

 

KNOWLEDGE

The second key to success in wealth creation is knowledge. It’s important that you learn as much about money and finances as you can, so you can make informed decisions for your own situation.

This is why Finwell Group run educational events for our clients every fortnight. Throughout the year we have thousands attend these events to learn more about their goals, financial planning, property investment, and self-managed super. The first key topic in knowledge is cashflow – and our strong advice is that you need to do cashflow well or you will run into trouble on your journey. Cashflow is king!

Another area of knowledge that is important to know is how government decisions – such as immigration policy – can have a huge influence on interest rates and other economic indicators.

Inflation isn’t because you’ve spent too much, or because the price of vegetables has gone up. It is because governments around the world printed money (also called quantitative easing) to support massive social spending, particularly during the recent pandemic. This isn’t the only time in history that the printing of money has caused inflation. Governments want to believe this will put energy into the economy but it also results in inflation.

 

ROUTINES

Now we come to the third and final key to success in wealth creation.

You have to have routines that you follow. Identifying the key successful actions that you should undertake on a regular basis will ensure you remain focused on your goals and don’t get distracted by unsuccessful or inefficient activities.

Make sure you measure and review your results periodically. This will give you both the opportunity to celebrate your progression but also take action where needed, ensuring you stay the path to your desired successful outcomes.

Finally, make it a routine to sit down with your financial advisor to review the performance of the strategy you have put in place and get guidance on any adjustments that may be needed to react to changing market conditions.

We hope these tips will help you make the journey towards your goals and creating your own wealth a little easier and clearer.

To get help with your current circumstances and identify what you can achieve, call the Finwell Group team on (03) 9017 3235 for more information or email us at better@finwellgroup.com.au for a free, no-obligation initial review.

We also encourage you to attend one of our free education events on a range of financial planning and investment topics including wealth creation.

The information in this article is general in nature and does not take your specific needs or circumstances into consideration, so you should look at your own financial position, objectives and requirements and seek financial advice before making any financial decisions.