Wealth is a choice, a concept, an attitude, a way of life. Wealth does not just happen. A couple must choose to be wealthy. Couples rarely succeed in building wealth without the strong commitment of both partners. The Law of Attraction states that you can create your life through your thoughts. Think wealthy thoughts and you are on your way to leading a wealthy life.

Making the choice to be wealthy sets into motion forces that will put you on the path of wealth accumulation. Study wealth, model wealth, choose wealthy habits, be wealthy. Wealth, in monetary terms, can be measured in terms of Capital. Capital is useful to the degree that it generates cashflow, which is what you use to meet your day to day expenses. The key to wealth accumulation is to build capital that generates cashflow. Once the cashflow from your capital is greater than your day to day expenses, you have solved the wealth equation. The wealth equation: Income – Expenses = Capital

Build capital by:

1) Increasing your income or your incoming cashflow.

2) Decreasing your expenses.


How do you build capital while raising a family, paying a mortgage, a car loan a student loan, saving for education and so on? To accumulate wealth, you need to systematically build capital on a daily basis. Many of your expenses are not going to go away, without a major lifestyle change. To build capital then, certain new habits will have to be developed.

Forced savings must become a part of your daily routine. Repetitive, unnecessary and frivolous expenditures need to be eliminated. Specialty coffees, snacks, regular takeout or delivery, cigarettes and other expenditures make it virtually impossible to build wealth. If you constantly expend all of your income, then you will be unable to accumulate wealth. You will not build capital as there will be no cash left. You need to divert a portion of your income, on purpose, to a capital accumulation pool in a systematic and repetitive manner.

Capital can be equated to freedom. Freedom is your ability to live your life as you please (within the boundaries of societal and moral codes) off the cashflow from your capital. Develop habits that build your wealth rather than erode your capital/freedom. The greater your capital, and the security of it, the greater your freedom. Some examples of wealth building habits are:

  • Daily deposits to a Capital Freedom Jar.
  • Weekly transfers to a savings account.
  • Monthly transfers to a savings account.

Use your electronic organizer to remind you to do your transfers and employ internet banking for convenience. When you do spend money, spend cash. Save the change. It adds up. Put it in your capital freedom jar. When you use a bank machine, pull out an extra $20. Sell off redundant items. Put the cash in your capital freedom jar. When you make a deposit into your capital freedom jar, praise yourselves for a job well done by saying “We are great builders of capital, we feel wealthy and free, we are wealthy and free.” Deposit the money from your capital freedom jar into an high-interest savings account every time you reach as set amount i.e.: $200.

Understanding how to calculate and manage the increase in your net worth is a very important part of maximizing your capital and freedom. Assets – Liabilities = Net Worth. Assets are items which can be liquidated to receive cash or items that generate cash flow.

Assets that spin off cash are termed as Financial Assets. Wealthy couples concentrate their efforts on systematically building their Financial Assets and reducing their debt that does not support Financial Assets. Liabilities are items that use your cash such as a mortgage, car loan, line of credit, credit card balances, student loans etc.

Build your capital by calculating and monitoring your Net Worth at regular intervals say monthly or quarterly. Build a spread sheet to do this. List your assets and liabilities and calculate the difference which is your Net Worth. What gets measured gets managed! Where you put your attention, you focus energy. Where you focus energy, you achieve results.

As a couple focus your attention on systematically building your Net Worth. You will apply energy with your new Wealth Builder habits and you will achieve results with increased Net Worth. Consider starting a part time business. The cashflow you generate from your business, after expenses and taxes, can be contributed to your Capital Freedom Jar. Business income receives preferential tax treatment over income earned by salary.

Forcing savings out of what is left from your salary after taxes, and day to day expenses can be a challenge even for the most seasoned savers. Forced savings is a habit that must be adopted in order to ensure capital is built on regular and consistent basis. As outlined earlier, systematic transfers to saving is a great way to consistently build capital. This is a must!

Parkinson’s Law states that outlays will generally adjust upwards to the level of inflows. Have you ever gotten a raise and wondered why you still had nothing left at the end of the month? This is Parkinson’s Law at work. You must defeat Parkinson’s Law by throwing a wedge into the equation. If you have a regular systematic transfer to savings, you have effectively put Parkinson’s Law to work for you. Watch automatic charges to your accounts that can creep up unnoticed such as cable, insurance, vehicle loans, and consumer loans.

As you accumulate capital, you are then in a position to invest in financial assets that will appreciate and eventually throw off cash to support your day to day needs. Once your cashflow from your financial assets exceeds your daily expenses you are, by definition, wealthy. You are then in a position to work by choice, not by necessity.

This obviously will not happen in 5 or even 10 years if you are young and just starting out. It will get you there in 15 to 20 years if you have the discipline to stick with it. As a couple, you will accumulate knowledge along the way that will help you with your investment decisions to grow your financial assets.

Make sure that you have fun along the way as well. Many couples have had great luck with setting up a Fun Jar as well that gets regular deposits for the sole purpose of having fun. Remember fun doesn’t always have to involve spending money. A little financial knowledge applied at the beginning of a relationship can put a couple on track to a wealthy life. It is your choice. Good luck!

This article is based on excerpts from a soon to be published book.

Rodney K. Robertson, B.Comm., C.A.

Partner SVS Group LLP, Chartered Accountants

Rod brings with him 20 years of combined private industry and public practice experience. Since receiving his designation in 1989, Rod was a business owner for a period of time and draws upon that experience to compliment his professional knowledge base in his hands-on approach to client service. Setting goals and developing strategic plans with regular feedback has been a formula for success that Rod insists is paramount in any business. Rod has been quoted in the past by Profit Magazine, when interviewed as a CFO in the magazine’s annual edition of Canada’s Fastest Growing Companies. Rod coordinates the firm’s Business Development efforts. Professional designations include a Bachelor of Commerce from the University of Saskatchewan. Rod is also a member of the Institute of Chartered Accounts for both Saskatchewan and Alberta.

On a personal level Rod is married to Cheryl and is the proud father of two wonderful little boys Kyle (7) and Blake (4). As a family they enjoy time together on their acreage and at their lake lot while attending to the educational personal growth of the family. Rod and Cheryl together have acquired and manage a sizable residential and commercial Real Estate portfolio.

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