I always wonder why no school taught us on personal wealth management. We go to school for around 20 years but nobody mentions the topic. I believe very few people have the knowledge of how to handle finances and therefore I will introduce the ‘Financial Wealth Management Pillars’.
1. Gathering wealth
This pillar talks on creating multiple sources of incomes.
You have to create several sources of income beside your main source to increase your income and to caution in case your main source is cut.
The next step is to budget the income gained. Budgeting helps to stop living beyond your means and to enable save a few coins for future developments.
Point to note – Savings make financial growth if well invested and therefore it is important to look for proper ways of investing your savings. Consulting professionals is important so as not to burn your fingers.
You start growing slowly and finally you get yourself there.
2. Conservation
Conserving the savings we have accumulated in pillar one is very important. Many things happen in our lives which end up eating the savings we make.
For example, once we get a job we start advancing in life. We buy cars, we move houses, and we marry and start creating family. All these start creating demands on our income. Families need your provision and protection, cars need fuel and insurance, houses need rent and insurance.
All these calls for your attention and they can exhaust your savings completely.
So how do we protect savings? Remember our multiple sources of income? This is where it comes in because your main source would be exhausted. Another thing is not changing your lifestyle as income increases to help you save and build wealth.
Insurance also comes in this pillar. This is where you become friends with your insurer; you transfer the risks to the insurance so that the journey for your financial freedom is not disrupted.
Take insurance to protect your children’s education and include different riders to guarantee your child’s education. Take medical insurance; medical can wipe away all your savings. Start with what you can afford and advance as you go by.
Insure your properties; have you ever imagined your house on fire? Where would you start?
Protect your property! Don’t go back to square one. Always consider insurance.
Set aside emergency funds; l always advise everyone to have a little savings in liquid which would be used for emergencies. With this you are able to sort yourself out without touching your savings.
3. Distribution
A dream with no continuity is as good as dead.
I wonder how many of us prepare our children in advance to inherit our dreams. Many motivational speakers have pointed out that we are producing a consumer generation rather than children who can continue our dreams.
We need to do proper upbringing of our children and instill the right seeds in their lives. I love the Indian community way. Most Indian children grow in their parents’ business watching and doing what they know best. Mentorship of your dream inheritor is very important to ensure there is continuity even when you are not there.
Another thing I have noted on this pillar is that it’s the most difficult pillar in our lives today. We watch prominent families fight for wealth, which ends up being held in trust while the owners are busy fighting in courts.
Everyone, including me, should do a will and deposit them with our Trust to avoid those fights while you are gone. At the time of resurrection I would love to wake up and find the wealth I left multiplied into billions and put into proper use by children of my generation.
YOU MAY ALSO READ:
By Lucy Mugo
Proprietor- Ryma Investment and Insurance Agency.-rymainsurance@gmail.com
You can also follow our social media pages on Twitter: Education News KE and Facebook: Education News Newspaper for timely updates.
>>> Click here to stay up-to-date with trending regional stories
