How to make more money: Your wealthsmith suggests 5 point focus
What exactly do we understand by a wealthsmith? You guessed it right! Just as the goldsmith moulds your gold ornaments and the blacksmith moulds hard iron, the wealthsmith actually helps you mould your wealth.
What exactly do we understand by a wealthsmith? You guessed it right! Just as the goldsmith moulds your gold ornaments and the blacksmith moulds hard iron, the wealthsmith actually helps you mould your wealth. But, why do you need a wealthsmith? Let us say, you are a 35 something professional who managed to start his business 10 years back and has built the business to an enviable level. You have expanded your business operations across India, your clients are happy, your income statement is showing a healthy profit and the cash is flowing in at a steady pace. Now that your business is in auto mode, can you actually afford to relax? The answer is an emphatic ‘No’. So what should be your focus?
Your wealthsmith suggests a five-point focus:
1. You have worked for your business success and have put your operations almost in an auto mode. The challenge for you now is to make money work harder.
2. You have age and success on your side and now need to translate this income into wealth. Remember, income has a bad habit of dissipating if an effort is not made to convert it into wealth.
3. As a businessman, you are always exposed to the vagaries of the business cycle. That means your business surplus has to be intelligently channelled into creating a reserve for business and also ensuring that your own financial future is secured.
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4. You are here for the long haul, so don’t worry about the short-term returns that you can earn. Focus on how you can grow wealth over the long-term without taking on undue risk considering that you also have a business to support.
5. Balance your returns with your liquidity. The risk appetite will be lower as you do not have an automatic cheque reaching you on the last day of every calendar month. Your wealth plan must be designed along these lines.
By Vaibhav Agarwal
(The writer is head of Research and ARQ, Angel Broking)
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