It's the first of the year and my wife and I were discussing where we want to go this summer with our family. I suggested a road trip down the Oregon coast. We'd start at the Columbia river and work our way down to the Redwood Forest in California, and then across the state through Nevada and back to Utah.
I'm also fascinated with maps, and while planning this potential trip I noticed the Columbia River and how wide it get's before it enters the Pacific. As a little kid I remember my parents driving across the river, and it seemed like we were on that bridge forever. It's amazing what a large river and how much volume the Columbia pours into the Pacific. The big question is where does it all come from?
The same question can be asked when you work with retiree's that have accumulated significant amounts of assets. At first glance you wonder where it all comes from because often they are retired school teachers, electricians, or had been workers at the local auto plan for 50 years. But after talking to these individuals and examining their asset's you realize there is much more to the reason they are financially secure and why most of us are not.
Like the Columbia River, many of these "rich" individuals attribute their wealth to a number of factors. The biggest being the fact that they have fantastic cash flow. The cash does not necessarily come from one source. Like the Columbia, other rivers, tributaries and mountain streams contribute to what becomes the picturesque post card we see that flows into the pacific. Wealthy individuals understand the impact of developing additional sources of income, and have taken great care to nurture and develop these resources.
Wealth comes through many sources. Many of us focus on our income, or our 401k. But wealth can be generated from a number of opportunities that come our way every day. From active investments like real estate, to passive investments like securities and life insurance, opportunity is always around us each day. The key is understanding when and how much do we invest.
Using our Columbia River analogy once again, opportunity is like the mountain streams that feed the mighty Columbia. But each stream does not produce the same in terms of run off. Some streams are "gushers" that produce once or twice a year. Others are more consistent like a job in the real world, and produce each day of the year. Others may be in drought zones that experience infrequent run off, but then go through periods of intense moisture, and every once in a while you find that stream that produces incredible returns. The key is understanding your environment, and like the Columbia developing a wide network of contributing cash flow streams, such as real estate, insurance, income, 401k's, etc....
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