When you begin thinking about private wealth management and financial planning, you’ll discover there are many things to learn, including how not to privatize banking. We continue with the Principles of Financial Prosperity by discussing principle #2: SEE the big picture. To maximize your prosperity, you need to see and understand the impact that each of your financial decisions.
Here is our guide to privatized banking:
How NOT to Privatize Banking
Many people wonder how to become your own banker and the steps surrounding long term financial preparation. Do you know someone who “steps over dollars to pick up pennies”? These people may have issues when it comes to correct private wealth management because they are only looking out for the short-term reward.
Thinking Just about Taxes
Some people make long-term financial decisions based purely on tax considerations. This approach to decision making can be dangerous because taxes are typically short-term. Everyone wants to pay less income tax this year, right? Our goal is to help you think about the long-term instead of focusing so heavily on the now.
Giving out Equal Shares
The impact of privatization reaches family financial planning. When devising an estate plan, some people mathematically divide equal shares to children, even though all children are not equally involved in the business. It may be more advantageous to divide your inheritance based on the amount of involvement your benefactors have with the company.
Many people take the phrase “be your own banker” a little too far. They go online for “do-it-yourself” legal forms to save a few hundred bucks. These little pieces of paper could mean the success or failure of your entire estate plan and cause thousands or millions of dollars to wind up in the wrong hands.
One of the best features of privatization is the knowledge and expertise accompanying a professional. You wouldn’t attempt a DIY approach to dentistry, power of attorney, or taxation, so why would you want to venture the tumultuous waters of banking on your own. Hiring a professional infinite banker guarantees a well-versed specialist experienced all the aspects and legalities of the job.
Trying to beat the Prevailing Theory
Many of people attempt to overcome the “Prevailing Theory,” the essence of human nature, in finance. Do you know someone who continues to amass credit card balances at double-digit finance charges, believing that they will win the game by growing their 401(k) or other savings to the point where the investment/savings account will surpass and overcome the debt? This is the ultimate rule on how not to privatize banking.
Unfortunately, math is involved in this situation.You can’t continue to grow 14% debt, building 1% savings, and expect to win. It is understandable to theoretically think it’s possible if you save a large portion of your income while carrying relatively tiny credit card balances, as long as those balances continuously reduce over time. But that is not what most Americans are doing.
Do you understand this is a losing game? Banks, finance companies, and other institutions rely on this illogic to make billions in profits. Infinite banking maximizes your prosperity and allows you to see and understand the impact that each of your financial decisions.
How to Privatize Banking with Alpha Omega Wealth
The Principles of Financial Prosperity serve as a guide on how not to privatize banking and help you through the process of successfully becoming your own banker. We’ve got all your personal management answers. Learn about asset protection and how to avoid jeopardizing your financial future and wealth.
NOTE: Our conversations about “WEALTH” will always include wealth in all its forms: educational, spiritual, cultural, community, material/financial, charitable, generational, etc.
This more inclusive, more realistic definition allows us to keep real “value” in mind and place our focus on things that matter the most.