So let’s look at each of the four wealth creation categories in turn.

Wealth mindset
Wealth Mindset is the first of the four wealth creation categories and examines the importance of the correct mindset to creating wealth and financial freedom.  Wealth mindset covers the interaction between you and your environment and the process of adjusting your thought process to think like the wealthy.

For example, the poor and middle class generally think that money is scarce and hard to come by.  Saying such as “Money doesn’t grow on trees” and “I can’t afford that” spring to mind.  The wealthy see a world of opportunity and abundance. They see money as little more than a concept and simply the by-product of providing value to others.  They also know that offering value to others is only limited by their imagination and thus money must too only be limited by their imagination.  The wealthiest people of the planet simply understand this and have incredible imaginations that create amazing value to others.

For example, Jeff Bezos realised that bookstores were severely limited in the amount of books they could offer their customers due to geographic and physical constraints.  In other words bookstores could only service customers that lived near them and could only offer a limited amount of books, which fit in their store.  He saw an amazing opportunity to solve these two problems by giving access to anyone anywhere via the Internet and offering a catalogue that is 40 times the size of a large bookstore.  Jeff founded the multi-billion dollar company Amazon!

Wealth Knowledge
Wealth knowledge is the second of the four wealth creation categories and examines the financial knowledge that is essential to create wealth and financial freedom.  It is essential for wealth creation that you are knowledgeable about your own personal finances, the economy, the psychology of markets, compound interest and the asset classes and investment products available to you.  Further, you need to understand how to interpret financial statements, investment strategies and risk management all from the wealth creation perspective.

Wealth Planning
Wealth planning is the third of the four wealth creation categories and examines the essential component of planning to create wealth and financial freedom.  Wealth planning is absolutely essential, yet on 3% of the population has clearly written goals and plans.  A Harvard Business School study found that this 3% earned 10 times the average of the other 97% and they accumulated 98% of the wealth.

Wealth Action
Wealth Action is the forth and final wealth creation category and examines the element of action in your wealth journey to create wealth and financial freedom.  The importance of action to achieving wealth is obvious.  Nothing can be achieved without action. 

By using the wealth formula you can easily learn where your wealth creation strengths and weaknesses are and where you need to concentrate your efforts at improving.