The most well known yet often ignored truth in finance is that compound interest works best over time: If you start with just 1¢ and double your money each day for an entire month, at the end you would have over $5,000,000. But if compounding was stopped midway through, there would only be a mere $163 after the first 15 days. The difference in outcomes is stark, and its a perfect illustration of the importance of uninterupted compound interest.

 

When most Americans do get a chance to set money aside, life still eventually happens: new car, kids braces, college tuition, down-payment on a home, etc. And as a result most drain their savings or worse put many major purchases on credit cards. Leaving you to start the process of compounding interest all over again, from the very beginning.

 

It is vital to find a way to cover these life events and major purchases without draining your tank, a way to spend money and still continue to reap the benefits of compound interest. Learn to become your own bank and let your money truly work uninterupted for you.

 

If what you knew to be true about home ownership turned out to be false, when would you like to know?  

 

A home can be an asset or a liability, the choice is completely up to you. Most of the traditional approaches to home ownership have created a great deal of wealth for banks and man individuals except one person, the actual home owner.  The realities of inflation, appreciation and most importantly opportunity cost will give you an entirely different perspective on what it means to be a smart home owner.  

 

The average lost opportunity cost for homeowners in California is $1,500,000 - $2,000,000. This signifacantly missed fortune could have otherwise been used for strengthening your retirement, enjoying your golden years, or left as a legacy to your heirs. Take a few moments to learn how to avoid these critical mistakes.

If you were headed to play in the Masters Golf Tournament, and could choose to have either Phil Mickelson's clubs or his swing, which would you choose? The swing of course, because with Phil Mickelson's swing you could use any set of clubs and have a fighting chance.  The swing is much more important than the clubs.

 

In retirement planning, many often don't use the same logic.  Financial products are the clubs, and you need a club to play the game.  But how you use the clubs, the swing, makes all the difference, and is where the bulk of your efforts should be concentrated. Perfecting your swing means avoiding unnecessary taxation, providing yourself with liquidity, taking advantage of opportunity cost, maximizing leverage, and much more.

 

The only way to get the most out of any financial product or qualified retirement account is to go to the practice-tee and gain an understanding of how to properly maximize them in accordance to your overall financial goals.