what is your wealth creation strategy

By Barry Fisher on KPRL Radio

As noted in my December 27, 2021 blog, 78% of business owners plan to fund their retirement through the sale of their business. Therefore, knowing the value of your business in real-time and ongoing is a critical aspect of an effective overall financial strategy. However, as we help entrepreneurs maximize the value of their enterprise, we’ve learned many owners have multiple business interests and assets that can be better aligned for desired results. So, while business valuation is important in itself, we employ a holistic approach to see how the business fits into the owner’s overall financial plan now and in the future.

It should come as no surprise that the number one wealth-creation tool is the consistent application of safe and competitive compounded interest. However, it is not atypical for a business owner to pay cash for everything or stash significant sums in low-yield savings or checking accounts as contingency funds. While it is sound business management to have a cash reserve, by always using your own money for major purchases, you may be sacrificing compound interest growth and accumulation. Simply stated, this very common business strategy creates lost opportunity in the long run.

I get it: procuring financing for significant purchases can be an arduous task, and most folks don’t like paying interest to a bank or being in debt. However, there are alternative financial vehicles that provide safety, easy access, and competitive tax-deferred growth you can use to self-finance your business activities without paying the lost opportunity cost of consistent compounded returns. We call this our Private Reserve Strategy.

In wine and whiskey making, private reserve connotes the best mix of elements and conditions to create optimum results. When creating a private reserve of cash, what elements might we look at? Here are some examples:

· Safety with no-loss protection
· Tax-deferred growth
· Tax-free distribution
· Competitive returns
· High and flexible contribution limits
· Easy liquidity, use and control
· Easy collateralization
· Guaranteed loan options
· Unstructured repayment provisions
· Consistent growth that maximizes the impact of compounding

For you, creating a personal private reserve may only be a matter of repositioning cash that you have stashed in an underperforming “mattress”. The Private Reserve Strategy will complement your current business and personal money management and allow you to maximize the power of consistent compounded interest.

If you’d like to discuss our business services and/or see how the Private Reserve Strategy can work for you, email me today at [email protected] or call (805) 635-7200.

What is your wealth creation strategy

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Categories: Business Owners