Financial Planning Fridays #43: Three Key Ways to Grow Your Wealth

Today we wanted to discuss three key ways to grow your wealth throughout your lifetime, and throughout the inevitable ups and downs, and uncertainty, that we all will experience with the market and in life.

To begin, it is vital to have a financial plan.

It is equally vital that this plan is regularly updated and that you clearly understand the inputs and outputs of the plan as the decisions that we make today can impact your wealth many years into the future. Your plan must account for this and include an action plan to work towards achieving both your short and long-term goals.

The second key is Behavioral Coaching. This may be the thing that has the biggest impact on your investment performance and, therefore, your financial plan’s success.

We can’t control or predict what the market will do – no one can – but there are proven ways that have historically improved long-term performance. These include things like, keeping most of your wealth in the types of investments with the best long-term returns, like stocks, as well as rebalancing your accounts regularly to both take advantage of market volatility and to avoid becoming overly concentrated in any one area of the market.

However, the real key is to buy stocks or to at least continue to hold them during times of extreme uncertainty, when everything seems bleak, for example when the market fell 30% in one month like it did as recently as 2020.

During times like this, it is especially beneficial to work alongside a trusted advisor to keep you from making the Big Mistake. This includes both keeping you invested in the market, but also ensuring that ahead of any volatility that you are well-positioned to benefit from it.

Third, minimize taxes.

Our goal is to shrink the total amount of tax that you owe over the course of your investing lifetime by employing various proactive strategies. These may include regular tax loss harvesting, Roth Conversions, and wisely choosing which of your accounts to draw from each year, alongside charitable giving strategies.

At Presilium, we are constantly reviewing these for you to make sure that you are benefiting from all of them.

By following these three keys to growing your wealth before and after retirement, you should not only see your account balances rise significantly over the long-term, but also enjoy life with much less financial stress.

Be on the lookout for our next Financial Planning Fridays episode. Subscribe to our Youtube Channel so you never miss an episode. Or contact us directly; schedule your 15-minute call with us today.