BennyEast.Com/Blog The official blog of Kenny West

Wealth of Knowledge

So...

Today I had this phone conference thing... I learned a few insights from the people managing money on my behalf.

The long and the short of it is... I also learned something about this world, and this country...

It's almost as if there are TWO kinds of people... Those who are personally familiar with the term "Wealth Management" and those who have no clue what that even means.

If you know what that means... You know which side of the fence you're on.  Or you're at least friends with people that know people.

It's crazy though.  I mean it just blows my mind.  Basically... I now know stuff that I didn't know earlier today.  Yes, predictions can be wrong, and we're not talking about mind blowing information on what's going to happen 100 percent in the future, it's just general guidance... But the fact that I have someone, or rather, a whole team of people, working to help me basically financially have an edge blows my mind.

Why?  Because... Okay...

This is the whole thing.... If you have investments, you have access to resources and people that can help you to do even  better (AKA make even more money).  But what about the rest of the people?  What about the people that don't have personal wealth management financial planners/investors/advisors/analysts available to them?

It's just, I guess I've come to realize that there is sort of setup this whole system society that stacked the odds in favor of those in the know.  And those in the know are then better prepared, and thus more likely to make even more money on top of that money they already have.

I mean, now that I know even more about the current market conditions going forward, and tax implications going forward along with proposed changes to fiscal policy and tax law changes that could happen under the next administration... I'm MORE in the know than your standard citizen.

But the only reason I was able to be told that information... Was because I already have these investments held on my behalf, making me a client.

It's basically that you have a small fraction of the citizens in this country, or world, profiting off of a large number of citizens.

Here's the thing... Money is debt.  All money is debt.  That's just what it is.  It's debt.  The only thing that changes, is who holds the debt.

So, you have people with money, are holding someone else's debt.  And people without money, actually HAVE debt.

For example, if you have money IN the bank... That money is ten loaned out to other citizens, in the  form of car loans, or home loans.  Then you get a small part of that interest that is being charged to the person who owes the debt.

Then there's bonds... Holding a bond, or bond ETF/mutual fund, means you receive interest payments on the debt that someone else owes.

Then stocks, are SORT of debt but not really, it's complicated.  Stocks are more owning part of the company, but that means you share in part of the profits, or losses... And then you have have share price appreciation and depreciation.

But the point is, if you have two citizens, one has some fairly large accounts... They walk into a bank, or an investment firm and they have a team of people who are there to help them make their money grow.  If you have NO money but NEED money... You have a team of people who loan you money, but with the expectation that on that money you already don't have... You have to pay even more money for the right to borrow that money.

It's a system that is leaning towards those who have money, and leaning away from those who don't.

I firmly believe that one of the most important things we need to do, is to teach those on the debt side of things everything there is about personal finance and how it all works.  That, to me, is one of the best tools.  A wealth of knowledge, because that will then help them in their journey to build wealth.

It's an uphill battle for sure, but one of the things I realized today is, most of building wealth is about being in the know.  Keeping yourself informed.  And making choices with your money with that information.  Because anyone who isn't informed can also see great sums of wealth erased by simply investing in the wrong thing at the wrong time.

I guess what I said isn't new or profound... It's the old "the rich get richer" routine.  But, the real question is... Why?  And I feel like a lot of it has to do with not just HAVING money.  After all, we hear about wealthy people going bankrupt and having their cars and houses taken away... And having to go back to work...

So, I feel like an important aspect for anyone to learn, is how wealth is built and maintained.  How to give yourself an edge with a wealth of knowledge.

Most people don't even know the term Wealth Management... And why should they?  They don't have any extra money at the end of the day/paycheck.  They just make it by barely able to afford life.

But, what's interesting is, it IS possible to build wealth, even with a small income.  Even if you have debt, it's possible to build wealth!

There are ways to consolidate debt, or find a lower interest rate... There are personal budgeting sites to help you get your spending down, and most are free.  You can even use sites like www.digit.co to save even as little as pennies from your paychecks.  Then after you save a little... you can use sites like www.capitaloneinvesting.com to start investing in stocks.  That site even lets you buy partial shares, so if you have only a small amount to invest, you can still start out small.  Some stocks have seen returns over the years in the thousands of percent.  That means just a hundred bucks would turn into 10 thousand dollars over time...

Another tool is diversification.  As one stock or investment continues to appreciate in value, you can then diversify into new investments.  This is a very powerful concept.

From there things just keep going... but knowledge is the real power.  Knowing the resources you have at your disposal.

Even if you're wrong in investing, there are many tax laws that favor losing money in stocks and help people out when it comes to paying taxes on capital gains.

But the thing is, most people have no clue how money management even works on the most basic level.... Or where to even start.

Nearly anyone can start with Digit.co and Capital One Investing.  And given enough time... They could end up having a private investment bank advising them or managing their accounts on their behalf.  The key is to get that knowledge to the people that need it the most.  Turn a wealth of knowledge into actual wealth.

So, the saying goes... Everything is easy if you know the answer.  I feel like the best way to be prepared for anything, is to just be as informed as possible.