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The Seven Enemies of Wealth

The Seven Enemies of Wealth  By Bimal Shah, CLU, CHFC, CASL

The Seven
Enemies of Wealth

By Bimal Shah, CLU, CHFC, CASL

The Seven Enemies of Wealth are Enemies that can take any, all, or some of your wealth much faster than you can imagine.

Enemy 1: Lack of Planning & Discipline
Lack of Planning & DisciplineLack of a Systematic Financial Decision-Making Process: Without proper planning & discipline, it is impossible to build wealth. 94% of the time the failure is because of an improper planning.

The first step is to create a Budget and to find out any expenses that aren’t necessary for your lifestyle. Those unrequired expenses are your Hidden Assets. The purpose of doing a budget for the wealth is to allocate the spending of money where it brings happiness and meaning to life.

The next step is to maintain 3 types of primary personal bank accounts.

  1. Lifestyle Account: Checking account where we pay everyone else.

  2. Planning Account: Bank account from where all your planning takes place.

  3. Wage Account (Emergency Account): It holds wages of up to six (6) months for emergencies.

Planning for this is a foundation to being
WealthY(Wealth + SecuritY = WealthY)

Enemy 2: Debt
Debt to Liquidity RatioMany misunderstand debt. Some might feel we should live debt free others believe leveraging debt is good. There are two rules of thumb.

Rule #1: Debt to Liquidity Ratio: At a minimum, you should maintain at least 10% liquidity to debt, and 25% is very good.

Rule #2: Differentiating Good Debt & Bad Debt: For any debt such as home loan, equity line, and property loans that are below 6%, there are tax advantages, and small business loans or lines of credit that are good debt.

Enemy 3: Taxes
It is absolutely imperative to pay the least necessary tax. In order to ensure this, you should work with a team of CPAs, Independent Third Party Administrators, attorneys, independent Insurance agents, benefit experts, and Independent financial advisors.
Enemy 4: Unexpected Events
It is very important to be fully prepared for the unexpected as it could turn your life, family, business, or livelihood around.
Enemy 5: Losses
The best way to make more money is to lose less money and by understanding the system of market cycles. And not putting foundational retirement and college education funding assets to very high risk.
Enemy 6: Lawsuits
It is imperative to protect your assets from lawsuits. A good attorney can provide the best asset protection planning according to your needs & objectives.
Enemy 7: Unintended Heirs & Separation
It is very important to plan your legacy to secure inheritance. A multi-generational legacy planning is also possible. Regarding separation, it is an extremely sensitive issue. Divorce can be worse than Death.
Bimal ShahAbout the Author

Bimal Shah, as a financial advisor for 21 years, has helped the community to preserve and protect their assets, build lasting legacies, increase their income, and reduce the taxes they pay. To contact him, please email him at info@bizactioncoach.com or call him at 561-208-4032.