Wealth Formula: The Secret To Wealth Creation
Question about wealth
How much wealth would it take to acquire bliss?How much wealth would it take to acquire bliss? And how would you proceed in spending it?
The Wealth Formula succinctly depicts the components that are necessary for you to create real wealth. The Wealth Formula is shown below:
M+K+P+A=W
It identifies four essential wealth creation stages and the relationship between them. These are:
Wealth Mindset
Wealth Knowledge
Wealth Planning
Wealth Action
It links each of these four component through the plus sign, +, which signifies that each of the four components are necessary for you to create wealth. In other words, missing one or more of the four wealth components will dramatically impact your ability to generate wealth.
For example, you could mentally prepare yourself, learn everything you need to make enormous wealth and create the most detailed plan to achieve your desired level of wealth, but if you don’t action it then all that preparation is worthless.
Similarly, if you mentally prepare yourself, learn everything you need to make enormous wealth and run off actioning your newfound mindset and knowledge but fail to make a plan it is like setting off in your car to go somewhere you’ve never been without taking a map. What’s your wealth destination? How will you know if you’ve achieved what you wanted to achieve? How do you know your using the right investment vehicle? How do you know if you’re on track or not to reach your target? Are you surpassing or underachieving against realistic milestones? All of these questions would be easily answered with proper planning.
So let’s look at each of the four wealth creation categories in turn.
Wealth mindset:
Wealth Mindset is the first of the four wealth creation categories and examines the importance of the correct mindset to creating wealth and financial freedom. Wealth mindset covers the interaction between you and your environment and the process of adjusting your thought process to think like the wealthy.
For example, the poor and middle class generally think that money is scarce and hard to come by. Saying such as “Money doesn’t grow on trees” and “I can’t afford that” spring to mind. The wealthy see a world of opportunity and abundance. They see money as little more than a concept and simply the by-product of providing value to others. They also know that offering value to others is only limited by their imagination and thus money must too only be limited by their imagination. The wealthiest people of the planet simply understand this and have incredible imaginations that create amazing value to others.
For example, Jeff Bezos realised that bookstores were severely limited in the amount of books they could offer their customers due to geographic and physical constraints. In other words bookstores could only service customers that lived near them and could only offer a limited amount of books, which fit in their store. He saw an amazing opportunity to solve these two problems by giving access to anyone anywhere via the Internet and offering a catalogue that is 40 times the size of a large bookstore. Jeff founded the multi-billion dollar company Amazon!
Wealth Knowledge:
Wealth knowledge is the second of the four wealth creation categories and examines the financial knowledge that is essential to create wealth and financial freedom. It is essential for wealth creation that you are knowledgeable about your own personal finances, the economy, the psychology of markets, compound interest and the asset classes and investment products available to you. Further, you need to understand how to interpret financial statements, investment strategies and risk management all from the wealth creation perspective.
Wealth Planning:
Wealth planning is the third of the four wealth creation categories and examines the essential component of planning to create wealth and financial freedom. Wealth planning is absolutely essential, yet on 3% of the population has clearly written goals and plans. A Harvard Business School study found that this 3% earned 10 times the average of the other 97% and they accumulated 98% of the wealth.
Wealth Action:
Wealth Action is the forth and final wealth creation category and examines the element of action in your wealth journey to create wealth and financial freedom. The importance of action to achieving wealth is obvious. Nothing can be achieved without action.
By using the wealth formula you can easily learn where your wealth creation strengths and weaknesses are and where you need to concentrate your efforts at improving.
Video related to wealth
This video basically sums up the distribution of wealth throughout the US population. The distribution of wealth in other countries, like the UK, is very similar. These figures are more than a decade old. It’s even more concentrated now.
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Tags: Financial Freedom, making Money, money, rich, wealth
Posted on June 20th, 2010 at 8:13 am
@theSeductionKing..Thats true.. and its funny you said that.. My brother just told me the same exact thing 2 days ago.. Right now while I am sending this message I am watching “THE SECRET”… VERY INTERESTING..
Posted on June 20th, 2010 at 8:33 am
a stereotype has been created of wealthy people
Posted on June 20th, 2010 at 8:36 am
@dlee4life actually it is “The Love of money” is the root of all evil..and the love used here is worship.
I do not worship money.
Posted on June 20th, 2010 at 9:21 am
I can't believe that you asked that question. All a lot of money does is cause trouble. As long as your bills are paid, a good roof over your head, food on the table and a little in the bank, you should be very happy.
Posted on June 20th, 2010 at 2:54 pm
Great! I am very thankful for this! Thank you, Joe Vitale and Mark J. Ryan! I am rich! I am full of abundance, of love, of peace, of money, of fulfillment, of joy, of hapiness!
I love you, reader!
With joy and love, and very, very positive energy sending to you!
Greetings from Poland!
VECK!
)
Posted on June 21st, 2010 at 4:22 am
@dlee4life The meaning of the pyramid and eye are exactly what you think it means.
they don’t have any meaning of their own…only what meaning you attach…and i can promise you that what i think it means is way different than what you think it means.
Posted on June 21st, 2010 at 11:26 am
It is not a new problem, but the Internet has made it more visible. People have always created wealth and production that is not part of the market economy, and so is not measured. If you take care of your own child, clean your own house, grow your food, fix your car etc it is not part of GDP, bit if you hire it done it is. When students study, learn a skill, or a researcher creates a new knowledge it adds wealth, in the sense that it creates a productive resource, but does not show up on anybodies account as wealth. The government statistics counts both public and private education expenses as consumption not investment.
You could even argue that most of the wealth we have inherited from our ancestors that provide us with a good life are things that are not now and never were bought and sold in markets.
There is an often quoted saying " if you give someone a fish they eat for a day but if you teach them to fish they eat forever". The logical conclusion of this is that the knowledge is more valuable that the product.
Posted on June 21st, 2010 at 4:49 pm
Your question defines what is wrong with Americans.
hurry up, you in my way, honk the horn, the drive thru is backed up.
Get rich quick plans don't work!
My grandparents worked their whole lives living on less than they made, not borrowing money but paying cash after saving up for things they needed not wanted and retired with dignity.
So If you wife won't work you need a second job and turn off the cable and other thing you don't need.
Posted on June 21st, 2010 at 6:48 pm
VERY GOOD. I've been debating this for months with friends.
We have become a country where we would rather take $200 and purchase a new iPod than use it to help another American.
These taxes go to building roads, bridges, hospitals, schools, libraries, and the works. It goes to supporting our education.
America has become a place where if someone takes some money from you to help the rest of the country and you're all of a sudden not able to upgrade to that 50" plasma, that person must be a socialist…
This country SERIOUSLY needs to re-evaluate its values…
Posted on June 22nd, 2010 at 4:17 am
Thank you, I already manifested my villa with swimmingpoo, on a tropical island in Thailand now I intend to manifest a brand new Alfa Romeo.
Posted on June 22nd, 2010 at 4:27 am
He's part of this bailout anyway.
Remember, he was in on the Fannie Mae/Freddie Mac scandal from day one along with numerous other democrats.
But to answer your question, liberals believe that everyone should be brought down to the level of the poor, so it's important to punish the achievers to make the poor feel better. It doesn't help the poor any, and in fact tends to hurt them ultimately, but it supposedly makes them feel that Obama is getting back at the rich folks. The German word for it is "shadenfreude."
Conservatives have a different philosophy. They want to elevate the poor and give them more freedom to make more money so they will rise up to the level of the achievers in society.
And unfortunately, Bush wasn't a conservative. If we can ever get back to a conservative way of running this country we'll all prosper. It may not be possible, but it's worth a try for the sake of our children.
The deficit has doubled in the last week while the democrats pay off all their rich constituents for getting them the election. It's sad.
Posted on June 22nd, 2010 at 5:05 pm
I wonder about this vid … the beginning of this video is hypnotic… the pyramid and eye is the secret sign of a curse…
Posted on June 22nd, 2010 at 10:36 pm
@theSeductionKing the eye of Horus.. the all seeing @ the top of the food chain.. this symbol sends a vibrant energy to people… its all about money.. MONEY IS THE ROOT OF ALL EVIL
Posted on June 23rd, 2010 at 1:59 am
It depends how much money you have…that is how much you have in net worth. If you have more than say $100,000 you may be allowed to see a wealth manager. If you have less you will be relegated to see an FA.
Posted on June 23rd, 2010 at 6:56 am
No. Cosimo D' Medici was responsible for the rebirth of culture. He was already wealthy. The Renaissance was the CAUSE of the rapid creation of wealth, not the result.
Posted on June 23rd, 2010 at 7:53 am
Thank you for this posting!
Posted on June 23rd, 2010 at 2:52 pm
Well, there is a balance between being aware and questioning and also thinking there is a conspiricy behind every blade of grass. But it is always good to question, just be aware of your own internal motives to put a spin on something..
Posted on June 23rd, 2010 at 7:56 pm
this website is all about the distribution of wealth during the 20's:
http://www.gusmorino.com/pag3/greatdepression/