Wealth Creation Blog

When people read a post like the last one, or read a mentor like Jamie McIntyre who tells them that they are the ones who really control their money, they are, understandably, reluctant to agree. They have been trained for too long to believe that the banking establishments call the shots. They have been brought up to be responsible citizens who pay their bills—even at their own expense. And as we said, it is not wrong to meet your financial obligations (although you will learn through wealth creation there are more ways to do that and still get out of debt, build wealth, and be a financial success). What is wrong is to relinquish that precious power of choice that we talked about.

What Happens When You Call The Shots

When you call the shots with your finances and income, you make a priority of you. That frees monies to invest and build wealth upon. That wealth attracts more wealth (Law of Attraction), and together they lay the foundation of your future financial freedom and capabilities. And over time, you become a wealthy person with money in the bank.

Now that you are that person, then what? That power of choice grows by percentages, with every dollar saved and made.

Having money, being wealthy, gives you control—leverage—over banks and creditors. These establishments don’t really like people to be wealthy because they lose control themselves when that happens. Suddenly you cannot be scared off by the need for a creditor’s approval, or the necessity of keeping a clean, high credit score. Suddenly you have people coming to you, clambering to get your business. Suddenly you are a powerful, wealthy, financial being with a great abundance of choice and options before you.

Now think this through a bit more. What if you did do some damage to your credit and finances in the past? What if prioritizing you upset some of those financial powers that be? What is to become of you?

Nothing. You, as a now wealthy, motivated financial being, still have all the benefits of wealth. You still are a person to be sought after and valued. You still have great choice and control.

Money has a way of healing past financial wounds. This means that no matter what occurred in the past, building wealth will repair that in the future. It won’t happen, though, if you do not build that wealth and power to begin with, and that won’t happen if you do not embrace the choices given to you and prioritize your financial future.

The reason that investing turns bigger profits than traditional bank accounts is that the investment markets are riskier—you are rewarded for investing in something that is not a sure bet. Therefore, inherently, wealth creation through investment is somewhat risky; without risk, though, all you have is marginal growth through savings.

However, your overall wealth creation strategy does not have to be risky. By using a simple strategy for wealth building designed by Jamie McIntyre, you can spread risk thin so that there is little to no chance of losing it all.

Baby Buckets

Jamie starts us off with the analogy of a big bucket of wealth. From that store, the money you have is divided into four smaller “buckets”, or “baby buckets” as Jamie likes to call them.

Each baby bucket is purposed for a different type of wealth. First you have your

• Security (cash) bucket

• Growth bucket

• Momentum bucket

• Lifestyle bucket

Each of these buckets, as you might have guessed, carry a different level of risk and are to be used for different types of investments (or for different strategies, as you choose).

The purpose of the baby bucket strategy is to create a personal investment portfolio of sorts. Taken as a whole, these baby buckets give you the ability to both secure a firm financial foundation and grow funds without the risk of losing it all. It’s risk and security all rolled into one.

In a future post, we’ll talk more about what goes into each of these wealth creation buckets and what the different levels of risk are. For now, start thinking about this concept. Strategies like the baby bucket principle are an important part of developing financial intelligence. These are the types of strategies that will help you start thinking about the big picture and the kinds of spending/saving/investment changes you need to make in your life so that you can work towards achieving sustainable wealth and financial freedom instead of gaining a few big investment wins that will last only temporarily.

Sean Rasmussen
Wealth Creation Blog
UniversalWealthCreation.com © 2004 - 2008

How many years in a row has this happened to you:

• The New Year comes, you set a resolution to improve your financial future

• You start off well, but quickly get sidetracked by life

• By February, you start promising to get back to that resolution as soon as life settles down

• By the end of the year, you are no better off than you were the year before, and you start to regret the time you have lost, and the time that you see yourself spending working and struggling in the coming year

Don’t feel bad, this is probably the case for the majority—year, after year, after year. The only way to break that cycle of regret for next year is to do something now.

This Is Your Year For Wealth Creation

Whatever your starting action is, take it now. Set time aside today to do something—anything- that will lend towards your wealth creation goals. This can be a simple start—read about opportunities in wealth creation, sign up for a wealth creation newsletter, subscribe to a blog, order a wealth-building program. Whatever it is, take a small step today, and commit to growth from there. Don’t stop with today, though; plan to make this your action on a regular basis for a long time to come.

• Set aside time during your week for researching and working on wealth-building programs (daily is excellent—every few days or even once a week will work, too, and will at least get you somewhere!)

• Take that time! Don’t excuse it away or let other commitments get in the way when the time comes. Treat your time for pursuing financial freedom as any other commitment, and act as though your life depends upon it (after all, it does, really, doesn’t it? Your secure, comfortable, financially free life does).

• Draft a plan and a set of goals, and track them as you go.

• Join a wealth creation program that will guide you and your efforts at making more money this year.

• Build upon your forward movement, and enjoy the motivation of routine and achievement.

Do you see a theme here?

You haven’t been given a list of absolutes (because wealth creation is individual); you’ve basically been given a call to action. To stop the cycle of wealth creation regret, you have to start on your way. Do something today so that lost wealth-building opportunities are not a regret next year. Do something that sets the standard of forward movement in wealth creation. Do something today that makes your life better tomorrow!Oh—and feel good about yourself, too, because you just did! You just read this blog on wealth creation. Now go do something else for you!

Sean Rasmussen
Wealth Creation Blog
UniversalWealthCreation.com © 2004 - 2008

Now that you have the general idea of what Jamie McIntyre’s “Baby Bucket” strategy entails, let’s talk about what goes into each of these buckets.

Security Bucket

The security bucket is your security net. This is not a foreign concept to most people, but it is one that is largely ignored. This is your physical cash and savings, as well as anything else that lends you security—insurance, retirement accounts, annuation…

Don’t expect to make big returns on the investments in your security bucket. You should see some small percentage returns, but keep this money as fall-back money. This bucket gives you the security to afford larger, riskier investments that will net better returns.

Growth Bucket

Your next wealth creation bucket is earmarked for growth. Fill this bucket with the things that will grow your investments—the things that are a bit more risky than those in your security bucket.

Your growth bucket might be filled with things like companies (good quality companies), residential properties, share renting, etc.

Momentum Bucket

The momentum bucket would be filled with monies that will continue to support your investments—money that makes money. This is the place for the big risks. You may put a smaller percentage of your money into this bucket, but it has the potential to net the biggest returns, and so can perform as well or better than any other. Each gain in this bucket will snowball to even bigger and better wealth, but you have to take care not to fill this bucket first and not to place everything in this bucket, or you will be wiped out—you’ll defeat the whole purpose of the bucket concept.

Lifestyle Bucket

Creating wealth is really about creating the means to support the lifestyle you want, yes? It makes sense then that one of your buckets should be a lifestyle bucket—an investment that may make a meager return, could possibly be turned into a more modest return, and that meanwhile helps you achieve the lifestyle you want.

Your lifestyle bucket might include a farm or ranch property, winter retreat, restaurant, inn, and so forth.

You have to take care filling your lifestyle bucket, though. This is sort of like when we talked about the appearance of money—just owning a lifestyle investment does not make you rich. Don’t jump into filling your lifestyle bucket too quickly. Start small, and first make sure you fill the financial bucket that can support that kind of a lifestyle property.

I hope you are starting to get the idea and starting to see how this type of diversification can create a firm financial foundation for your wealth creation plan. Attending to each part of the wealth creation puzzle will ensure that you have the things you want, the money you want and need, and the investments to back them.

Sean Rasmussen
Wealth Creation Blog
UniversalWealthCreation.com © 2004 - 2008

The “Baby Bucket” principle shows you how to spread risk. And we talked about the fact that the bigger returns are on the riskier investments. So why not just go to the end game and start enjoying big returns right off the top? Why bother with these smaller securities?

“…the fastest way to become wealthy is determined by the speed at which you get yourself into a position where you can afford to lose money.”
–Jamie McIntyre

Success in wealth creation doesn’t just come from having access to money to dump into a stock. Wealth is built when you have money to back you so that you can afford to take the big risks—so that you can afford to lose the money on your investment.

The Baby Bucket strategy aligns your money and investments in a way that allows you to create wealth in smaller intervals and also builds an investment base. When you have the smaller bucket working for you, you have a self-sustaining financial program that brings in investment money and works as a fall-back should a single large investment go bust. This is what the wealthy do, and this is what you should do if you want to find an easy path to investment and wealth creation.

The bucket concept is more about being able to afford to invest and lose than it is about gains (which will come naturally later). The bucket strategy is about building financial intelligence and sustainability.

Note, though, that being able to afford loss does not mean you have to lose

It just means that you will not be wiped out and back to square one if you do. This concept of spreading risk is about creating sustainability in your wealth creation program, and securing true financial freedom by having all the bases covered.

Sean Rasmussen
Wealth Creation Blog
UniversalWealthCreation.com © 2004 - 2008