One Truth About Investing You're Unlikely To Hear From a Financial Advisor
Posted: Tuesday, January 17, 2006
by Loral Langemeier
http://www.themillionairemakerbook.com
Ask anyone who lost a bundle in the bust of the dot.com bubble, and you'll probably get an earful about playing it safer next time.
Diversify! That's the battle cry of the typical investment advisor. They'll prod you to ensure that your portfolio is spread between various industries and markets. You'll have some money in high tech stocks, some in pharmaceuticals, and some in the manufacturing sector.
Your investment advisor will make sure you've got a pile of cash stored "safely" away in bonds and mutual funds. This is what they call a diversified and safe portfolio.
I call it the "park and pray" method of investing, and I firmly believe that by following their advice, you are putting yourself and your children in much greater danger than you think.
Your financial advisor will likely think I'm crazy. But, which one of us is a multi-millionaire? Not only have I made millions, I have coached countless individuals and families to become millionaires, which is why my publisher named my new book The Millionaire Maker.
The one truth your financial advisor may not tell you
I didn't become wealthy by playing it safe. Nor, do I take blind risks. What your financial advisor isn't likely to tell you is that you are completely capable of becoming wealthy without a portfolio of stocks and bonds.
I took a very different route to wealth. I looked at what wealthy people were doing. Is your financial advisor wealthy? I'll bet that if he or she is wealthy, the money didn't come from taking the steps they're telling you to take. It's just not what wealthy people do.
Wealthy people don't park their money with some financial institution and hope (pray) for the best. They use a very different process, a process that I've fine-tuned through my experience in making millionaires.
The real building blocks of wealth
There are 12 building blocks of what I call the Wealth Cycle™ process. The Wealth Cycle™ encourages a more direct form of investing than the park and pray method. That is, wealthy people are much more active in the creation of wealth.
You won't get wealthy overnight, or without a clear plan and a process. That's why I created these 12 very distinct building blocks.
No two situations are the same, so when I work with people, I make sure that they get the sequencing of the 12 building blocks done in the best way possible. The order in which you take these steps will be different from anyone else. What are the 12 building blocks? Here's a quick snapshot (they're covered in detail in my book):
· Financial Baseline - where you are
· Your Freedom Day - where you want to be
· Gap Analysis - your Freedom Day plan
· Debt Management - getting rid of "bad" debt, creating "good" debt
· Entity Structuring -reduce taxes and limit liability
· Cash Machine - your primary source of cash for investing!
· Wealth Accounts - where you put your money instead of savings accounts
· Forecasting - knowing where you're going
· Assets - the real secret to wealth
· Teamwork - creating a strong wealth team to help you succeed
· Leadership - leading your team
· Conditioning - getting your mind and emotions to align with your goals
I believe any plan that requires you to cross your fingers is not a good plan. That's like dropping off your kids when they're infants, taking them back when they're 18, and hoping they turned out alright.
Traditional financial planning only ensures that you'll continue to derive 80% of your earning capacity after you stop working. Is that good enough for you? I, for one, have no desire to limit my income and become poorer as I get older.
Taking these steps requires taking on responsibility - responsibility you won't face if you just blindly park and pray. If you have any desire to see your income increase, not decrease as you age, you'll learn more about the Wealth Cycle.
Wealth building is possible for anyone who learns and uses the right skills at the right time. Loral Langemeier literally creates millionaires, and she does it using a well-honed and tested system that anyone can learn. Creating sustainable wealth does not need to remain a mystery! Order your copy of Loral Langemeier’s book, The Millionaire Maker, today: http://www.themillionairemakerbook.com
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