Issue 27.11
Part 1
In my line of work, I often have deep and meaningful conversations with families about the things which they care most about. I LOVE those conversations. I believe understanding these deeper passions is important when it comes to developing an estate plan or managing finances.
As I do so, I also run into people’s attitudes about their wealth.
I’ve made a close study, over the years, of how money “works”, and just what it is that propels certain individuals and families into great quantities of resources … and what also brings them down.
I’ve compiled a group of behaviors characterizing the financially-strapped.
It’s something to watch out for in your children — For example it may give you a clear picture of what might happen should you bequest your resources to them without a clear estate plan.
You may have resources NOW … but are you:
* Spending money on things you really don’t need: I’m sure we’ve all got one of those friends who just loves to spend money, and buy things just to say they have them. The newest iPhone just came out? They buy it even though they already have an older version.
That may be fine for a certain amount of time, but there is something deeper happening in the heart which, if left unchecked, can signal a decline in wealth. Because it starts with the iPhones … but where does it end?
* Ignorant about where your money is going: Far too often people who are broke find themselves short because they’ve never tracked their monthly cash flow and their small expenses are adding up to consume everything they bring in. They really need to track their expenses for a month or two so they can have a plan.
But the wealthy sometimes begin to believe they’re immune to such proletarian concerns, and allow the same bad habit to encroach into their portfolio. Don’t let up — but, of course, don’t fall into obsession (e.g., are you checking your accounts every day? That’s also a problem!).
Next month we will continue with the remaining characteristics of the financially strapped.
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