The Best Wealth-Building Tip: Safety First – Palm Beach Research Group
“I’ve made millions of dollars, and here I am again, struggling to make ends meet.”
“This is crazy,” I thought.
For years, I had struggled to manage my wealth… it was either feast or famine.
I was either rolling in millions or bumping along the bottom of the barrel… scrambling to scrape up enough money to pay my annual taxes.
And that’s when I realized all I had learned up to that point wasn’t going to be enough to get me to where I wanted to go.
In that moment, I understood I needed a new model for creating, growing, and safeguarding my wealth against the worst tendencies of my spendthrift nature.
And so, I started studying the habits of the wealthy.
One of the first things I learned was that wealthy people focus on building multiple streams of safe, passive income. They build their wealth on a base of conservative, income-producing investments. They then take a portion of their passive income and speculate with it.
This flew in the face of how I had made all of my money in the past.
But I remembered where my past had taken me. I knew I had to do something different if I wanted different results.
And so, I switched my focus from making as much money as possible from speculative investments… to building as much safe income as possible from my investments.
I made my focus safety first.
The Right Way to Build Wealth
I moved the bulk of my money into real estate, index funds, and closed-end income funds. And I started using out-of-the-box income strategies.
At the same time, I eliminated all of my consumer debt. By this time, I had picked up some wealth mentors. My mentors taught me never to use debt to acquire depreciating assets. You get poorer with each payment instead of richer.
They told me to fund investments… not cars, boats, and vacation homes.
Along with shunning consumer debt, they were adamant I must never, ever speculate with my principal capital.
They said I should only ever speculate with a portion of my investment income. This way, they explained, even if all my speculations went to zero… my lifestyle and wealth would be unaffected.
When I received the dividend and interest income from my safe investments, I could replenish whatever I lost on my speculations.
It sounds so simple as I write these words…
But for me, it was a multidecade journey that required the embarrassment of bankruptcy and bounced checks before I was humble enough …….