Wealth Planning & Debt Reduction

Debt Reduction is a very important part of our Wealth Planning process. As you know, debts are the one that hinders your progress towards Financial Independence and Financial Freedom.

However for some, especially business people would say otherwise. They would advocate the term "OPM" or "Other People's Money". This is to say that by using OPM is to leverage wealth through not using your own money but by using other people's money. Such as taking a loan to purchase Real Estate for investment purposes.

However not many individuals like the idea of having more debt. Having more debt is only good if the ability to pay back is certain. People who uses OPM is certain that they can pay back the loan quicker. But yet, we see many investors and business people get caught for example during the credit crisis in the fall of 2008.

Overnight rich people still went bust and bankrupt when the credit crunch took place.

Therefore our main strategy here is to have an exercise to reduce debt and have a goal of being financially free.

Go to wealth experts and ask a wealth query with regards to Debt Reduction.

Let us now look at the important aspects of Debt Reduction.

Again we look at the 5 Driving Forces                                            to determine our direction.

The 5 driving forces are Wealth Aspirations, Strategic Wealth Analysis, Strategic Wealth Planning, Wealth Action and Wealth Management.

Wealth Aspirations
This is an understatement. Debt reduction should be a number one priority for any individuals.

To find out more about Wealth Aspirations, click here...

Strategic Wealth Analysis
Next step is to start analysing a few things:
1. List down what you owe.

2. List down what you have.

3. From the top 2 points you would be able to determine your net worth.

4. List down all your cashflow. From your cashflow, you would be able to determine whether you are able to reduce your debt.

5. Look out for better debt reducing rates so that you do not continue to pay higher interest.

To find out more about Strategic Wealth Analysis, click here...

Strategic Wealth Planning
This next step requires you to start the planning process of getting to your objective, which is reducing your debts.

With all your information in the analysis step, list down which debt you want to clear first. Map a plan on how to do it and by when the fastest possible time to reduce it. Then move on to the next debt. Plan the reduction debt by debt and you should attain your goals quite easily.

To find out more about Strategic Wealth Planning, click here...

Wealth Action
Debt Reduction requires great discipline. Our human tendency is to spend first of what we have. So Debt Reduction has a competition and it is called Debt Infection. Because we are easily affected by debts that we keep spending and with todays' availability of credit today means that it is easier to get into debt than to get out of it.

Discipline yourself that you must reduce that debt before you spend again.

To find out more about Wealth Action, click here...

Wealth Management
The monitoring of the last part is important not that you have cleared your debts, but rather your restrained from obtaining new debts. That in our opinion is the most important when you are managing your debts.

To find out more about Wealth Management, click here...

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