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April is Financial Literacy Month, and we are thrilled about the excitement from our clients and prospective clients surrounding the Money Mastery Basics and Intensive classes, as well as the upcoming Money Mastery 8-week coaching program. If you haven’t participated in any of these classes, don’t worry. We have online courses available to take at your own pace. Check our website to learn more.
We are passionate about educating, inspiring, and igniting people into action regarding their goals. This is particularly true as it relates to financial goals. We believe that everyone who desires to amass wealth can do it. Simple strategies exist for building wealth. And once you’ve built it, plan to pass that wealth down to the next generations of your family.
The Bible tells us that “A good man leaves an inheritance for his children’s children.” Many people express a desire to create and pass on generational wealth to their children and other heirs, but they are unsure how to do it.
If done properly, passing down generational wealth can have a multiplier effect that grows exponentially over time. Generational wealth also provides your family a financial “leg up” which has the potential to change the trajectory of a family by breaking the cycle of poverty and building a foundation for future financial success.
Many people express a desire to create and pass on generational wealth to their children and other heirs, but they are unsure how to do it.
Passing down generational wealth can also create future financial support to religious organizations and other charities of choice. This allows those organizations to continue to flourish even after you have passed away.
Do not allow yourself to get overwhelmed because we are talking finances. This is simpler than you might think. As with everything, cultivate the desire to create and enjoy wealth. Then, make the decision that you WILL position yourself to create AND pass down generational wealth to your heirs. Then BELIEVE!! Finally, pray and ask God to help you with your faith as you walk out this process.
Now let’s go!! Here are seven simple steps to get started on your generational wealth building journey:
Step 1: Pay off Debts
It is important to get rid of as much debt as possible. If you have a debt, you likely owe interest. Why pay interest when you could be utilizing that money for other financial goals. Paying off consumer debt should be your first priority. Consumer debt includes credit cards, personal loans, automobile loans, and student loans.
Step 2: Purchase a House
Home ownership is one of the best strategies for building wealth. This is because homes usually appreciates. This simply means that generally, home values increase over time. This increased value equals equity, and that equity increases your financial worth.
Step 3: Start Long-term Investing
One of greatest strategies for building wealth is utilizing the power of compound interest. This may surprise you, but $100 invested with a 12% return on investment, equates to $1.2 M in 40 years. If you wish to invest more, you reach a million dollars that much quicker (at a 12% return on investment). Investing in market securities like stocks and mutual funds are impacted by market fluctuations (meaning returns go up and down) so you’ll want to engage a financial advisor, but investing long term can really grow your financial portfolio over time.
Step 4: Start a family business
Most wealth is built through business and entrepreneurship. There is absolutely nothing wrong with having a job, but most jobs don’t pay enough to live off AND also generate wealth. Selling goods and services is an excellent way to create additional financial resources. Turn your hobbies into a business or find goods or services that are in high demand and along with your family, open a business.
Step 5: Purchase Life Insurance
Proceeds from life insurance can be utilized to pay a loved one’s funeral expenses, but payments from insurance policies can also aid a family in building wealth. Some insurance policies give you the ability to build wealth during your lifetime. Consult with a licensed life insurance agent who can guide you on the best life insurance for your situation.
Step 6: Create an Estate Plan
You MUST have an instrument by which your wealth will pass to your heirs. Nothing negatively impacts a family like fighting over money. So, be kind to your family and consult with a lawyer and/or CPA to create your estate plan.
Step 7: Share Your Financial Wisdom with Your Family
Better than having the wealth to pass down to your heirs, is passing down the knowledge you utilized in building the wealth. If your heirs obtain the money and no knowledge, the wealth will likely stop with them. Teach your family about wealth strategies so they continue the legacy. This is a multi-generational work that starts with you!
To learn more about the Money Mastery classes and the upcoming Money Mastery 8-week Bootcamp, visit us at https://www.theedgeperformancegroup.com/money-mastery-coaching.
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