Hoarding Vs. Accelerating Money
What’s The Sure Road to Riches?
How do you create wealth? Saving at an exceptional rate while scraping by, right? Make money, then store it away in savings accounts, a 401(k), RSP, an IRA, and some mutual funds. In essence, hoard your money.
The hoarding or accumulation strategy is the money management plan most common to individuals and families in this country- and it is failing miserably. It’s what we’ve all been taught. Such has been the case ever since there have been banks in which to put your money, and financial advisers to sell you their products.
For decades, financial institutions and the people who sell their products have told people to save, scrimp, and invest in long term, diversified products so they can someday retire and live off the fruits of their wise financial planning.
We’ve been sold a bill a goods.
We’re not saying this financial strategy doesn’t work. We’re just saying it doesn’t work for the consumer. It works for the financial institutions and the people selling you their goods, in that it gives them the money with which to manage their money in an entirely different fashion – one that works.
Think about it. While banks recommend that we invest heavily and diversely, and to hoard, they do just the opposite – and they do it with our money! Instead of hoarding, banks utilize the money individuals store with them and keep that money liquid, and in constant motion.
Banks create velocity with money, and judge success based on cash flow, not on accumulated piles of money.
Financial institutions propagate the myth that financial success results from investing in material things and saving. They do so they can have money to accelerate and utilize – just as we should do with our money.
By utilizing and accelerating your money, you can maximize the effectiveness of not only your money, but your life. By breaking free of the accumulation theory, you free your money to be utilized in a productive manner, creating value and true wealth.
Just look at the difference in mindset and attitudes between the ways of looking at wealth:
- Tends toward scarcity, in that those who practice it develop the scarcity mindset through years of frugal saving, always in fear of losing their accumulated money
- Compound interest is key
- Key Indicator of Wealth is determined by net worth
- Do-it-yourself, reduce expenses, wait for the future
- Invest in material things, products, and strategies
- Security is derived from accumulated money
- Investments are unsecured and uncollateralized (money in mutual funds and qualified plans can disappear with nothing to show for it)
- Higher risk equals higher returns
- Tends toward abundance, in that practitioners learn to constantly seek ways to maximize their usefulness to the world, rather than waiting for retirement
- Velocity is the key
- Key Indicator of financial Wealth is determined by cash flow
- Utilize the abilities of others interdependently, increase production, and act in the now
- Invest in the people behind products and strategies and in clear value propositions
- Security is derived from human life value, knowledge, experience, and practical application
- Some investments are secured and collateralized (if the cash flow stops, the physical asset can be sold and/or leveraged)
- Risks are managed and minimized, which results in higher returns
- Soul Purpose
- Focused as opposed to diversification
Are you creating velocity with your money? Could you be utilizing it more effectively to not only make more money, but to live a richer life?
Want to find out how to apply this to your specific financial situation today?
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