For busy professionals like myself, we work hard for our paychecks and compensation. We are trying to build wealth for our family’s financial security. We’re preparing for the day when we have the financial freedom to no longer need to work for someone else to pay for a comfortable life for our families.
Before I break down the above purpose statement for my investment business, let me explain my background to you. If you don’t know me that well, I am a CPA with a professional career spanning over 35 years. I still work everyday. I have managed to work my way up to a position where I am the top accountant at my employer.
Most people think of CPAs as tax experts and many are. In the CPA world, I am not considered a tax professional. I’m more of a general accountant and responsible for many areas, including the accounting at the plants, the offices and corporate headquarters. I am also responsible for financial analysis, financial planning and budgeting and taxes, including tax strategy and tax compliance.
I think this experience gives me a lot of perspective and experience to assess financial results and create financial strategies to meet the goals and objectives of a venture.
I have found that I’m not very good at traditional investing in stocks, bonds or most of the traditional types of investments available to Americans from Wall Street firms. In future newsletters I’ll dive into why this is, but for now, just know that several years ago I shifted my mindset to investing in “Real Assets” as I call them instead of the “Paper Assets” created by the Wall Street firms.
Real Assets are tangible, real things that are needed by people, companies, society and the economy. I categorize real assets into the following categories:
Merriam-Webster defines wealth as 1. Abundance of valuable material possessions or resources, 2. Abundant supply, 3a. All property that has a money value or an exchangeable value and 3b. All material objects that have economic value.
Wealth happens when what we produce has more value than what we consume. With that thought, I think of personal wealth as what we have collected of value that we can use to invest and use to support the personal lives of our families.
Therefore, if we are going to invest, the first rule I want to follow is to make sure this investment helps me to preserve my wealth.
Merriam-Webster defines inflation as an act of inflating or a state of being inflated. What is inflating?
In the economy, the money supply has been continually inflating or expanding in size rapidly since 2009 and periodically going back to 1971. If the money supply inflates faster than all the goods and services in the economy, then the money will become less valuable when measured against real goods and services.
If you are holding your wealth in dollars, you are losing your wealth.
Merriam-Webster defines tax in the verb form (taxed, taxing, taxes) as to make onerous and rigorous demands on. This is usually done in the name of paying for property or services for public good, but I believe that the tax code has a different purpose.
The government has historically spent more money than it raises through taxes, so it is clear to me that it doesn’t need taxes to operate. The structure of the tax code is such that the first 1% or so tell individuals and companies how much they need to pay in taxes. The remaining 99% tell them all the things they can do to reduce how much tax they pay, including all the way to zero taxes. To me, this looks more like a carrot and stick system.
Why would governments do this? Because they can’t do everything that society needs to provide a great economy to live in and improve lives.
What are the incentives in the tax code? Well, they generally fall into the categories of providing jobs for other people, providing real estate to live and work in, providing energy for the economy and producing goods and services that the economy and society needs. A lot of these sound very similar to the basic real assets I mentioned above.
I focus on cash flow rather than appreciation when investing. The vast majority of people don’t live off appreciation, they live off cash flow; a set amount of money coming in every week or month. Appreciation is less predictable and more of a gamble. Cash flow can be predicted when getting into an investment. If you focus on cash flow and also get some appreciation, that’s a bonus.
Thank you for giving me the opportunity to share the meaning behind my mission statement along with more details on what I do. I’m focused on matching busy professionals with high-performing real assets to preserve wealth, minimize taxes and generate passive cash-flow, and this is the purpose of MATCH REAL ASSET PARTNERS, LLC. I focus on partnering with successful and high-performing partners to create high-performing investments to help you:
Do you have a tax problem?
Are you struggling to build or maintain your wealth?
Are you interested in building cash flow?
Schedule a call with Mark to start a conversation on how to solve these problems.