Are you being strategic with your investments? Or are you randomly investing in different assets, hoping for the best?
“If you fail to plan your financial journey, you are planning to fail”– George Antone
In this episode of the Wealth Amplifier, George Antone explores the four phases you need to progress through on your wealth journey to ensure you achieve your financial goals faster, safer, and with more certainty.
Planning your wealth journey
Imagine you are planning an international vacation for your family. The first thing you are likely to do is start planning, right?
You will need to start by setting a budget. You might then do some research about possible destinations. Once you know where you want to go and how much you will spend, you can start implementing a plan. You must apply for travel visas, book flights and accommodation, and perhaps book a few activities. You can do this all yourself or use a travel agent to get the guidance and support you need to plan the best possible trip.
What does this have to do with wealth building, you might ask?
Well, anybody who has been on a poorly planned vacation will tell you it’s unlikely to be an enjoyable experience.
Building wealth is the most important journey that you will ever take. However, most investors set out without any plan in place. It is, therefore, not surprising that most investors have a very tough time reaching their financial goals.
How to start planning your wealth journey
The first step in developing a plan for your financial journey is realizing that every trip happens in phases. According to George, there are four broad phases that every investor goes through on their wealth-building journey.
As we unpack each phase, remember there is some overlap as you transition between phases. It’s also important to keep in mind that each phase requires a specific strategy to master. However, the first step is to understand each phase and identify where you are on your wealth journey.
The four phases of your Wealth Journey
Phase 1: Financial Stability
The first phase in your wealth journey is Financial Stability.
This phase is all about laying a solid foundation for your financial future. It’s critical to control your finances and manage your debt effectively. Controlling your debt doesn’t necessarily mean being debt-free; it means managing your debt responsibly.
During this phase, you should focus on building an emergency fund, managing your debts, and getting a grip on your spending habits. Dave Ramsey’s financial principles are particularly useful in this phase, helping individuals gain control over their finances before moving on to wealth accumulation.
Remember that financial stability includes an emotional component. Many people have difficulty controlling their finances because they have not adopted a healthy money mindset. Achieving financial stability is not only about balancing your budget; it’s about personal growth.
Phase 2: Wealth Accumulation
Wealth Accumulation is where most people start their wealth journey.
This phase involves investing strategically to maximize your wealth over time. The goal is to grow your money through smart investments in assets like real estate, stocks, and other income-producing ventures.
During this phase, you’ll maximize every dollar you invest and actively work towards your financial goals. Your portfolio should be built with income-producing assets, appreciating assets, and a focus on downside protection. This is the phase where you take off and start building your wealth.
This is also the point where you might want to consider using the services of a ‘travel agent.’ The most effective way to avoid expensive mistakes on your journey is to find a coach or a mentor who is well ahead of you on the journey to building wealth. They will already have overcome many challenges that could slow down your progress. By leveraging the knowledge and experience of those who have gone before you, you will be in the best position to accelerate your journey to success.
Phase 3: Wealth Preservation
Once you reach your financial goal in the wealth accumulation phase, you transition into Wealth Preservation.
This phase is all about protecting and preserving your accumulated wealth. The key objective is to minimize risk and ensure that your income lasts for as long as possible.
Imagine Wealth Preservation as a shield. You want to safeguard your assets, lower risk, and ensure that your wealth continues to grow, even in the face of inflation.
This phase requires a different strategy, focused on preserving what you’ve built and keeping your income on an upward trajectory.
Phase 4: Wealth Distribution
The final phase of your wealth journey is Wealth Distribution.
During this final phase, you’ll focus on passing on your wealth to heirs, creating a lasting legacy.
Planning for success on your wealth journey
Understanding the four phases of your wealth journey is essential if you want a smooth one.
You can tailor your investment strategy to maximize your wealth and financial security by identifying your current phase. Remember that each phase demands different strategies and objectives, so building the right portfolio and planning is crucial.
If you are ready to set out on your wealth journey and achieve your goals faster, safer, and with more certainty, join us for our upcoming workshop: