The Secret to Building Wealth

Building and sustaining wealth over the long term isn’t about winning the lottery, coming into an inheritance, or falling back on a trust fund. Every one of us has the power to establish long-lasting, healthy streams of income that lay the groundwork for elevated net worth.

How? It turns out we’re more in control of our financial destiny than many of us think.

The answer is our financial behavior. It’s a simple thing we’re fully capable of managing—it’s also the number one predictor of wealth. Groundbreaking research conducted by Sarah Stanley Fallaw, author of The Next Millionaire Next Door: Enduring Strategies for Building Wealth, found that the majority of millionaires have one thing in common: They use their financial behavior to create wealth that’s built to last. Interestingly, but not surprisingly, the top three financial behaviors of millionaires are:

  • Spending below their means
  • Exploring a side gig
  • Eventually moving to self-employed work

Good or bad, our financial behavior is what shapes our financial habits. And habits, as we all know, have a way of enduring. There’s also a growing body of researching drawing a strong link between our financial habits and our overall happiness. One 2018 Northwestern Mutual study found money to be the leading cause of stress for Americans. What’s more, 41 percent are stressed out over retirement planning.

The antidote is tweaking our financial behavior. Cultivating the habit of routinely saving for the future not only reduces stress; it also puts systems in place for building our wealth. This directly translates to the way we invest. Research shows that being a great investor is less about timing the markets and more about our mindset. More specifically, what makes a successful investor is the ability to reflect on their past financial behavior, recognize how their personality and habits have influenced their investing strategies, and make a plan for how they’ll leverage this wisdom to grow their wealth going forward.

Our financial behavior, hands down, is the single best predictor of whether or not we’ll be successful in accumulating wealth. Using it to our advantage in order to take charge of our future requires some financial excavation on our part. How financially literate are you? Do you feel confident and in control of your money, or is the opposite true? Do you live within your means? Do you have a plan in place for working toward your long-term financial goals? Believe it or not, simple questions like these, which reveal personal traits around money, have the power to accurately predict wealth.

Taking a deep dive into these traits—then using them to inform your financial behavior—doesn’t have to be intimidating or complex. Opal Wealth Advisors’ Wealth Building Assessment provides an effortless snapshot in about 10 minutes. The straightforward test is designed to uncover your money habits and, most importantly, how they’re contributing to your financial success (or pitfalls). Personalized insights serve double duty, celebrating your strong habits and shining a light on behaviors that are standing in the way of building wealth.

Creating and sustaining long-term wealth doesn’t happen overnight. More often than not, it’s a slow build that requires your attention, positive habits, and a plan for monitoring your progress and course correcting as needed. In other words, it requires some degree of patience and self-forgiveness. The latter may sound a bit out of left field, but hear us out. Changing our behavior, while simple in and of itself, isn’t always easy, especially if you have to unlearn long-held habits that aren’t serving you. BJ Fogg, Ph.D., a behavior scientist at Stanford University, says successful behavior change comes down to three key factors:

  • Getting specific
  • Making it easy
  • Triggering the desired behavior

Accountability is the other part of the equation. This includes holding yourself accountable as well as creating systems to keep you chugging along—even when it feels tough. Going from living way above your means to living within a budget in order to build your wealth, for example, may feel challenging at first. Opal Wealth Advisors leans on the latest behavioral finance research to help investors of all stripes feel confident, empowered, and positioned for growth.

Be a Smart Investor

Stay up-to-date with industry-leading information and news delivered straight to your inbox.

Get our timely insights delivered to your inbox (Blog)

  • This field is for validation purposes and should be left unchanged.

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Opal Wealth Advisors, LLC [“OWA]), or any non-investment related content, made reference to directly or indirectly in this commentary will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this commentary serves as the receipt of, or as a substitute for, personalized investment advice from OWA. OWA is neither a law firm, nor a certified public accounting firm, and no portion of the commentary content should be construed as legal or accounting advice. A copy of the OWA’s current written disclosure Brochure discussing our advisory services and fees continues to remain available upon request or at www.opalwealthadvisors.com. Please Remember: If you are a OWA client, please contact OWA, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.