Pillars of Wealth #1 – Intro

Wealth has always been subjective for each of us. If you are healthy, with family, have roof above your head and some friends you are luckier than you might think.

As I focus here on rather financial issues, I am going to skip non-financial pillars. So what are the cornerstones of my financial strategy?

  1. Own home without mortgage
    Many of us do not consider this as so important and seek to live in a rented property. In short-term it is usually better, but long-term this asset brings you only added value. And also calm and self-realization
  2. Property for rent
    It is a great tool for BECOMING rich, but once you purchase many properties and you use no leverage (loan for purchase), it becomes lower-income asset class. Nevertheless, it is conservative, stable, possible to be turned to auto-invest
  3. Securities
    Most valued asset class for me, especially when speaking about long-term. It is more difficult to build wealth just with this because you simply need to earn the money and save them then. But with its potential around 7% p.a. with no worries, no work, stability and full auto-pilot, it is must-have part of your portfolio.

There are other asset classes which are used my many investors – like commodities, metal (gold, silver, platinum), bonds, cryptocurrencies, peer2peer both retail & corporate and many others. There are also other approaches like active trading (many assets classes), betting, casinos playing and I will get to these, later. With description why I think they do not have anything to do in a one’s portfolio.

So back to intro and show some teaser for the next time. I use just these 3 asset classes and if my target is eur 1 mio, I should end up somewhere on eur 200k in my own home, eur 300k in properties (to have stable cash-flow) and eur 500k in securities. But this is for another time.

See you soon in beginning of June with May’s review!

Categories: pillars of wealth

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