Managing, Preserving and Maximizing Wealth

 Wealth can be defined as purchasing power.  Purchasing power is the amount of money you need to purchase a certain amount of goods and services.
Managing one’s wealth includes how you put your money to work.
Keeping costs down, getting the most value for the money you spend and investing wisely such that your purchasing power continues to grow beyond inflation.
Preserving wealth has been a passion for me.  It is not always how much you make, but how much you keep.  Keeping current and future costs down, by spending wisely, can increase how much you keep.  Since income taxes can be a large percentage of what you keep, minimizing these taxes can have a significant effect on your wealth.  Long-term income tax strategies, starting at an early age, can have a disproportionately large positive effect on wealth.
Maximizing wealth includes investment allocation, risk tolerance, rate of return and time.  Investment allocation is a strategy based on alternatives with different characteristics.  Risk tolerance is the degree of ups and downs an individual is willing to withstand.  Rate of return is the gain or loss on an investment over a specific period of time.  Time is how long you expect to invest.
A good way to get started is to formulate goals.  Write them down.  Then study alternatives and refine your goals.  Then write them down again.  Then do it again.  This should be a lifelong habit.
Having good advisors that you respect and whom respects you are very important.  The value you receive from a good advisor will far exceed the costs.
Jerald Schneider is a Certified Public Accountant providing tax, accounting and financial advice for more than 30 years.  He can be reached at 661-297-1072 or by e-mail at jerald@jeraldschneider.com.