How to Wreck-Proof Your Wealth Plan – Part 2

Creating wealth is as dangerous as stalking a wild animal: if we do not understand everything possible about money and treat it with respect and manage it with great skill it will destroy us as quickly as any beast of prey.



According to Theun Mares in his book The Return of the Warriors: life is as much about hunting today as it was in the past when men were the hunters going out each day to hunt for food. In those days they took the hunt very seriously. Hunting animals was a dangerous business and if you put a foot wrong you could end up being the food rather than bringing it home. On the other hand if you simply sat at home and waited for the food to appear it very rarely did.


Today we no longer have to hunt for food; we buy it at the supermarket with money. But don’t kid yourself nothing has changed. While we no longer hunt for food we still have to hunt for the money with which we buy it. Sitting at home waiting for the money to arrive is about as stupid as the hunter waiting for the Kudu to politely arrive at the door and accidentally fall into his cooking pot. We have to go out and stalk it.

The hunter leads a disciplined life and is totally dedicated to hunting. The hunter is a disciple of hunting and directs all his efforts towards knowing everything possible about hunting. And stalking money is as dangerous as stalking a wild animal.


Creating wealth is exactly the same: if we do not understand everything possible about money and treat it with respect and manage it with great skill it will destroy us as quickly as any beast of prey. Money is a slave and it works for whoever puts it to work. Money will provide the best return to those who manage it correctly and will destroy those who show it little respect. Money has no mercy.

In the same way that a hunter lives the hunt to the full in order to succeed, so we today must direct our full attention towards money if we wish to conquer it and succeed in this arena of wealth creation. Wealth does not fall into anyone’s hands by chance; it has to be captured with patience, slowly and carefully.


A Wealth-Generation-Plan or Budget is one in which:

  • You hunt money with dedication, integrity and care.
  • Your target is to get every rand of income to generate another rand. This is the ideal and you may never quite achieve it; but the closer you get the wealthier you will be.
  • Wealth generation and financial security come first; you come second and luxuries come last.
  • Your first target is to stop paying PAYE Tax; in other words to eventually earn an income other than from a job.
  • Your second target is to put seed capital before any other outflow or expense; that is to allocate the very first part of your (after tax) income to investing money in such a way that it will bring back more money – i.e. growing your money. The secret of wealth is acquiring income generating assets.
  • Your third target is to set aside money to get out of debt.
  • Your fourth target is money to meet your monthly financial security goals.
  • What is left will have to meet the balance of your needs and keep you alive and healthy – e.g. food, clothing etc.


If we combine wealth-protection, wreck-proofing and Kiyosaki’s three stages of wealth-creation we end up with a 3 stage wealth-protection checklist that will work something like this depending on your needs and circumstances:


  • Setting out your investment philosophy and your investment guidelines which incorporate your lifestyle and financial priorities. Warren Buffett Wealth by Robert P. Miles is an excellent guide.
  • Writing down the broad outline of a Wealth Creation and Wealth Protection Plan (that is divorce friendly!)
  • The introduction of a Wealth Creation Budget with Seed Capital
  • Having correctly structured books of account and financial statements for both personal affairs and businesses – regard yourself as “JB Smith Ltd” and Monitor your WC Budget and NAV monthly and annually with a simple Accounting package
  • Banking right – maintaining a good bank credit rating
  • Maintaining a good credit rating with Retail Stores
  • Ensuring correctly structured tax returns and business activities that minimise taxes and maintaining a good standing with the local Revenue Service
  • Maintaining a healthy Life-style and hospital protection as opposed to expensive medical aid
  • Disability insurance (tax deductible in certain countries)
  • Cost effective Life Insurance for the longest possible term with Future Protection (guaranteed future option on life cover)
  • Funeral Cover
  • A correctly formulated Will
  • Motor Vehicle, Household and All risk Insurance
  • Your personal motor-car-maintenance plan to hold the asset value as high as one can
  • You personal household-maintenance plan to hold the asset value as high as one can
  • Working hard in a job and on your wealth protection strategy
  • Being a Passive investor – still strongly dependent on the guidance of financial experts. A Risk Management Strategy with emphasis on Moderate-risk and Long-term Investments
  • A Personal Book-of-Life that holds all your Insurances, Life Policies, RAs, Assets and Liabilities, SOGW worksheet and Will in one place
  • A Wealth Plan work sheet with a list of assets and liabilities, purchase costs, improvement costs, dates of acquisition etc
  • A Financial literacy Programme and
  • The Science Of Generating Wealth by Wallace D Wattles


  • Retirement Planning and Tax Deferred Retirement Investing that provides maximum tax free income on retiring
  • Estate and Tax Optimization Plan
  • Educational Plan for the kids
  • Running your own business on the side
  • Establishing a mastermind advisory panel which includes an ontological leader coach
  • Paying for your car in 3 years and holding it for 6; i.e. paying off two cars in 6 years
  • Paying your bond in 10 years or less, accessing the bond for cheap finance (especially for motor car and credit card debt), and ensuring via a bond broker that you always have the lowest bond rate
  • Buying pre-owned time share
  • Tax efficient investment plans such as endowments
  • Endowment based holiday plan to fund quarterly breaks annual holidays and overseas travel
  • Dread disease insurance
  • Inter-vivos and business trusts to protect assets where cost effective
  • Medical Aid appropriate to your health condition and family needs
  • Life Cover and Retirement Investments for spouse
  • Optimization of Wealth Creation Budget – maximizing the percentage of money working for you
  • Optimization of NAV growth
  • Strict Cash Flow Management
  • Risk Management Strategy with emphasis on Moderate Risk Investments and risk containment
  • Collective Investments (Unit Trusts/Mutual Funds) and other moderate risk Long Term investments – 10 years or more
  • Emergency Fund – 3 months income in low risk liquid investments
  • Work hard and smart
  • More active investor – taking charge and responsibility for your wealth – less dependent on the decisions of financial experts
  • Wealth protection and wealth creation in balance
  • Financial Literacy Programme continues
  • Experience stage of financial literacy programme – learning from mistakes


  • Active and independent investor – all your money working for you one way or another and achieving your desired ROI
  • Resigned from your job to mange your wealth plan full time
  • Business optimization: business works without you and achieves desired ROI
  • Business Succession Plan in place
  • Buying value business investments or acquiring assets without money
  • Business Investments and acquisitions continue to flourish
  • Acquiring Portfolio Investments – Share Market Investments
  • Refined Risk Management Strategy with a mix of more aggressive investments
  • Diversification of Risk including 20-30% offshore investments
  • Property Investments generating recurring income
  • Working smart and loving what you do every minute of the day
  • Living in your ideal home and driving a cost efficient luxury car
  • No problem you can’t handle
  • Active independent investor and business owner – calls on experts for their expert opinion but makes own decisions
  • Low maintenance recurring and passive income
  • Sustainable creation of excessive cash a daily habit
  • Continuing to learn from active involvement but now with fewer mistakes


When it comes down to real wealth there are no shortcuts. Creating real wealth takes time. It is a marathon. It takes 15 to 30 years and it initially involves work. So the sooner you begin the better. But the good news is that when you are wealthy you never retire and you never work.

Hard work however is all relative. If you do what you love work is never hard. Warren Buffett at the age of 76 says that he “Tap dances to work” each day. He has a wealth protection based approach to investing that reduces risk to a minimum and optimises income and his system has made him either the first or second wealthiest person in the world.

The rich put immediate comfort and luxuries before wealth. They laugh first for sure, but it does not last, and when it really matters they are crying while the wealthy are having the last laugh.

But those who laugh last laugh longest and with this plan when you get round to laughing you will laugh long and hard because you have your priorities in the right order.


But make no mistake you will need a master mind advisory group and ontological or generative leader coach to assist you to realise this strategy. It is extremely unlikely that you will achieve it on your own. Contact me at Science of Generating Wealth when you get serious about making this a reality in your life. We all have invisible barriers to our success: barriers that we have created ourselves. But barriers that are invisible to us. To dissolve these barriers we need an ontological coach. There is no question about it.