The goal should be to increase the latter relative to the former. Realized income is highly taxed unrealized income is not. Tax is the single largest expenditure therefore its minimization is valuable. Used vehicle buyers are extremely patient in finding the right deal. Half don’t spend more than $24,800 US for a “new” car. First, it establishes a modus vivendi and, second, longer term compounding pays off.Ĩ1% buy their cars the balance lease. The most successful business people share one trait in particular: they enjoy what they do. They don’t sell advice on thrift and budgeting because they find it embarrassing to tell clients that their lifestyles are not sustainable.
The best accountants initially served within a large accounting firm and then went out on their own.įinancial advisors often have too narrow a focus they sell investment and tax advice.
There is a high correlation between wealth accumulation and having high-grade financial advisors, including accountants. Their most trusted advisors are their accountants and lawyers. This includes learning about investment management, budgeting, seeking financial counsel and spending time with them. Middle-income PAWs show the same propensity to plan and budget as high-income PAWs. For others, budgeting is less formal and is controlled by creating an “artificial economic environment of scarcity”. For some, budgeting is a formal, time-consuming process of keeping track of what they spend. “Offence” refers to going out and making money: “Defense” refers to not spending it, the anchor of which is budgeting and planning. These people have the wrong focus: they assume that the means to high net worth requires focusing on generating high incomes. High income occupations often do not have high wealth accumulators. Under accumulators are also described as high income/low wealth. Divide by ten and subtract inherited wealth.Ĭategories are prodigious (PAW), average and under (UAW) wealth-accumulators:Ī PAW has at least 2 times the wealth in the above formula. Multiply your age by realized pretax income from all sources except inheritance.20% of wealth is in stocks, which are held long term.They invest approximate 20% of household income.Only 17% attended private school 55% have children in private school.80% are college grads: 38% have advanced degrees.Half have occupied the same home for twenty years or more.Annual income is approximate 7% of wealth.Half of the spouses do not have outside careers.They are proficient in targeting marketing opportunities.Their adult children are economically self sufficient.Their parents did not provide economic outpatient care.They believe that financial independence is more important than displaying high social status.They allocate their time, energy, and money efficiently, in ways conducive to building wealth.Synopsis: Affluent people typically follow a lifestyle conducive to accumulating wealth. This book is a must-read for you or a family member if you’re struggling to find financial sense in your life.
Authors: Thomas Stanley and William Danko
0 kommentar(er)
