3 Tips to Build Wealth Independent of Your Business

Tip One:  Cultivate the skills and experience of investing so

when/if you do sell your business, you have the skills to intelligently

invest the money.

This includes picking a few areas to focus in on to build your "Advantages" in.  Your Advantages include your knowledge, expertise, experiences, contacts, financial resources, etc.

For myself, over the past 15  years I've cultivated Advantages in

real estate and my two key investment niches are currently commercial

real estate (mainly office buildings) and hard money lending.  Both of

these work well for me to generate passive, residual income (PRI) based

on my advantages.

What niches will you focus on?  A particular area of stocks?  Bonds? 

Private placement investments in privately held companies?  Index

investing?

You need to start today to create a plan whereby you accumulate the

Advantages you need to be successful.  If you wait until you have that

liquidity event (e.g. selling your company) you'll be in a rush to

invest the capital and you'll make mistakes.  I learned this one the

hard way to the tune of $3 million.

What do you need to learn about your chosen niche investment vehicle?

What books, courses, classes will you master?

What contacts do you want to cultivate over the next 24 months to help you in this area?

What experience sets do you want to gain to help you in this area?

How can you creatively craft those experiences over the next 24 months?

Tip Two: Start investing 10-15% of your working time and money NOW to your investing outside of your main business.

I will be the first to acknowledge that focusing your main efforts on

building your business is the single BEST way to accumulate net worth. 

Period. End of story.

But it isn't enough.  You need to build wealth outside of your

business, both to protect you and your family, and also to cultivate the

skills and Advantages you need to be ready if you ever sell your

business.

Start today to set aside 10-15% of your working time and net income

to invest outside of your business.  (An interesting test would be to

sit down and calculate how you are doing on this target that I laid

out.  Where is your current starting point?)

Tip Three:  Create a simple quarterly "scorecard" for how you are doing in your investing outside of your business.

Your scorecard should include:

• How

  much have your set aside to invest (both in dollar amounts and as a

  percentage of your net income).  Track this against your target

  (see Tip 2 above for my suggested level).

• How

  have you done managing your investments?  Measure your AFTER TAX,

  AFTER FEE, REAL return against an appropriate passive bench mark.

• The

  key learning goals you have for the quarter in this area of your

  life.  Track how you did to meet and exceed these learning goals.

• The key relationship/contacts you wanted to establish or deepen for the quarter.  Track how you did to meet these targets.

Imagine the impact of doing this for several years BEFORE you sell

your company.  You will be more confident and much more prepared to

wisely invest the money you get from the sale.

I'll share one more cautionary tale about this.  One of our clients

sold his business for over $4 million cash.  He knew how to build

businesses, but he never really focused on the skill of how to

intelligently invest his net worth.  The result?  5 years after the sale

of his company he had lost $3.5 million from the sale from bad

investments.  Don't let that happen to you.  Invest the time and energy

to prepare yourself NOW!

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Or for more information on growing your business visit David on the web at: www.MauiMastermind.com