What Are Reasonable Wealth Goals?

Avoid These 5 Traps if You Want Your Wealth Goals to Stay on Track

Several of you asked me about this trap, and wondered if I was saying it was okay to set your goals low? Absolutely not! Your goals need to be set high, they just need to be reasonable.

Let me give you an example of what I mean.

Person A & Person B have the same goal. Each has $100,000 to invest and wants to turn it into $1,000,000 in 5 years. Now, this requires an average annual rate of return of 58%.

Is an average rate of return of 58% reasonable? Some of you may be chuckling and thinking, "There's no way!" While others, like me, think a return of 58% is too low! But the truth is, it's not the rate of return that makes a goal unreasonable. It's about what you are willing to do.

In this example, for one person, this is a reasonable goal. For the other, it is not. Here's why.

Person A - Person A has had a business for 7 years. In the past 2 years, Person A has gotten out of the day-to-day operations as a result of having a strategy and systems in place. Person A understands and embraces the leverage and velocity that comes with systems. Person A is ready to apply these same systems to building wealth.

Person B - Person B has also had a business for 7 years. Person B works in his business a minimum of 60 hours per week. He would love to be able to get out of the day-to-day operations, but can't imagine how the business would run without him there. Person B wants to focus on creating wealth and has the goal to turn his $100,000 into $1,000,000 in 5 years, but right now he needs (or he thinks he needs) to be in his business 60 hours per week.

Which person is more likely to focus on their wealth? Which person has the knowledge of systems to leverage in their investing? Are you person A or Person B?

With focus and leverage, a return of 58% is attainable. It is not attainable when there is no time to focus or no knowledge of systems.

Now, Person B could achieve his goal, but it is all based on what he is willing to do. Is he willing to leverage his business so he has the time to focus? Is he willing to increase his knowledge of systems?

It is not the return that makes Person B's goal unreasonable, it is what Person B is willing to do. Some people are not willing to get out of the day-to-day operations of their business. Some people don't want to learn new things. This is what determines if a goal is reasonable or not.

Do you have the time (and money) to create wealth? Creating a wealth strategy and implementing it doesn't have to be a full-time job, but it does require focus and some time and effort. As with business, the key is treating your investing like a business which means building the systems.

These are the principles I teach when I'm speaking on stage. These are the principles I follow in my business. And these are the principles I follow in my real estate investing.

Person A & Person B have the same goal. Each has $100,000 to invest and wants to turn it into $1,000,000 in 5 years. Now, this requires an average annual rate of return of 58%. http://www.provisionwealth.com