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Do you feel like you are working hard to earn money for your future, only to have to pay it out in the form of taxes, investment fees and other commissions, fees and penalties? We call these “transfers of wealth,” and they are very common but are often unnecessary.

For example, one of the key principles of  economics is that, due to inflation, our money is never worth more now than it is today. That means that when you overpay your tax withholdings to the government in your paycheck, the government has the use of your money until April 15 when you file your tax return—a time frame as much as a year or longer. Receiving a tax refund may seem like a bonus or a savings account of sorts, but in actuality, when the government returns your money a year later, it is not paying you any interest for the privilege of keeping your money and, even worse, your money is actually worth less when you receive that check a year later.

Think of it this way:  You buy a sweater at the mall for $30, pay with a $100 bill, and the clerk tells you they will hold on to your $70 in change and send it to you next April. Would you accept waiting that long to get your change back? Certainly not! Yet that’s exactly what most Americans are doing with their tax withholdings—and even treat the refund like some kind of bonus! A better way is to reduce your tax deductions before they come out of your paycheck.

Everyday we’re faced with transfers of wealth, not only giving our money away to other people or institutions, but losing all control of it in the process. Why would we want to lose control of our money after working so hard to earn it and losing our ability to profit from it once it is transferred away?

Fortunately, there is a better way. Instead of losing control of our money, we can minimize wealth transfers, keeping our money for our own use rather than someone else’s. To get started, we want to recognize where those transfers exist and how they ultimately cost us more money, rather than earning it. Here is a list of common transfers of wealth:

• Taxes — (“We’re here from the gov’t, and we’re here to help you!”)
• Financial Planning — (The usual methods that incur Fees, Losses, etc.)
• Disability — (You were healthy as a horse, then suddenly…)
• Retirement Plans and Funds — (locked-out from use, higher taxes in the future?!)
• Tax Refunds — (We just gave a free loan to the government!)
• Credit Cards — (The banks’ most profitable product.)
• Buying a Home — (the classic 15 vs 30 yr mortgage choice—longer is better!)
• Life Insurance — (it may look cheaper…but is it really?)
• Car Purchases — (Every 5 yrs, your entire life—that cost $2M. Recover that!)
• Investments — (Oops…you didn’t expect to lose that money now, did you?)

By studying each of these transfers, we can learn how they are affecting us and our wealth. The truth is, even though these transfers may seem basic, and even inevitable, each creates a financial loss for us. These transfers have been set up intentionally to make money for the institution, not for us as consumers, but there is a better way. We can challenge common financial practices andasking who is actually profiting from these transfers of wealth.

One of the most complex transfers of wealth to understand is investments. Typically, we look at investments as vehicles that should help us earn more money on our savings, retirement, etc. This is the traditional way of thinking. However, if you’ve ever looked at an investment statement, you’ve seen the fees and you understand that rates of return, which are based on the past and not the future, are not guaranteed. The new thinking – which we call Prosperity Economics – takes a different approach. This thinking helps you find ways to hang onto more of your money to ensure a better financial future for you and your family. Prosperity Economics recognizes that a real investment is something that should be making you money, regardless of the whims of the marketplace. Common “Financial Planning” practitioners misuse the term—to them, an “investment” becomes a gamble instead of a guarantee.

Here’s how it works. Prosperity Economics strives to reduce transfers of wealth so that your money can grow regardless of the marketplace and other outside factors. This is referred to as growth internal savings. We can show you how to put your money in investments that are internally beneficial to you to accomplish three critical goals:

1.    You regain the control of your money.
2.    Your money begins making money for YOU, not for someone else.
3.    You decrease the risk of your investments.

This may seem impossible, but it is entirely doable. By questioning traditional financial and investment wisdom, you can regain control of your future and stop unnecessary transfers of wealth. Through Prosperity Economics, we can show you how you can minimize your transfers of money, and see your wealth grow as a result.  We give you the confidence of knowing that what you want to happen, will happen, not matter what  external factors may come into play.

Want to learn more? Contact us today to stop the unnecessary outflow of cash. We can show you how.


It seems like there are an infinite number of financial possibilities for us to choose from, and with the Internet making information so readily available, they’re all just a click away. This barrage of financial information from the Internet, TV, radio and news can be extremely overwhelming, even for the most financially savvy. How are you supposed to know which financial strategy is best for you, your goals and your current circumstances? 

Wouldn’t it be nice to have an easy-to-follow, straightforward strategy to use in understanding and evaluating this multitude of financial products and possibilities? Well, I have good news for you! There is! There is one financial strategy that reigns superior to all the others; one that allows you to address even the most pressing of financial concerns.- Prosperity Economics.

Prosperity Economics already acknowledges that it’s not all about your net worth. It is, however, fundamentally about your income. It may seem a little too simple or too good to be true to base all of your financial decisions on asking yourself how it will affect your income, but go ahead. Try it.

How will buying a new house affect your current income? Will your mortgage payments be more than what you’re currently paying, negatively affecting your income? How will quitting your job to go back to school affect your income? Obviously, you won’t have an income anymore, but having a higher education degree increases your future income potential. Is it worth it?

We are a nation built upon the dream of financial prosperity. Most of us go to school not to better educate ourselves, but to make more money. We try to climb the corporate ladder because we know that with that promotion comes more money. We’re a country of people totally obsessed with money. We can’t survive or thrive without money.

That being said, it’s no surprise that evaluating our income, and how our financial decisions are going to affect your income, are important aspects of financial planning.

If you think that by having a job you’re doing all you can to generate income, you’d be wrong. It’s obviously the easiest and most predominant method of generating income, but it’s not the only method–nor even the best. After all, your income from working at a job is limited by the hours in the day. Every good financial plan includes the management of various assets, as opposed to just one, in order to generate income. You have to broaden the scope of your financial plans to include various methods of generating income, having money flowing through your assets, in order to have a successful financial strategy under your belt.

We are all aware of the basic principles of cost and benefit. We heard the term used countless times in our introductory economics courses in high school and college. The desirability of any decision, not just a financial decision, is a direct measure of the cost and benefit. Ok, so we get it, right? Wrong!

Many of us fail to realize the true cost of the financial decisions that we make on a day-to-day basis, whether in our businesses or our personal lives. To understand the true cost of a financial decision, we must properly evaluate the opportunity cost. Without an understanding of opportunity cost, it’s nearly impossible to devise and execute a comprehensive financial strategy that meets all of your goals and expectations.

So what exactly is opportunity cost? To put it simply, it is the value that you would have received had you not lost an asset. Take this example. Let’s say you have $5000 and decide to invest it in mutual funds. If it does well, there will be taxes to pay from those gains. The taxes are a cost. Let’s say that the taxes amount to $500–you have to pay that from somewhere, and since the account caused the taxes, it’s fair to calculate taking that $500 tax bill out of the account. But this also means that $500 is no longer there to continue to grow. Had it not been lost to taxes, it could easily have grown to $16,000 in 50 years. But you didn’t have it–so it didn’t. You lost $500 to taxes, and that caused you to lose $15,500 in opportunity costs. Recognizing this very real truth would allow you to consider these costs in light of alternate ways of handling your money with lower–or even zero–opportunity costs. This is the only truthful way to consider what an investment might really yield.

Why is opportunity cost so important? Well, simply put, it’s a way of evaluating the attractiveness of various financial possibilities, assisting us in making decisions to create better financial strategies.

So I guess now is a good time to ask yourself – Have you incorporated the “all about income” philosophy and calculation of opportunity cost into your financial planning strategies? Do so, and you increase your chances of a more prosperous monetary future. If not, seek out an experienced prosperity economics advisor to show you what changes are possible.

What do you think? Let me know in the comments below.