The Wealth Formula

The Wealth Formula

Here are some helpful tools that can be applied (regardless of which wealth creation course of action you decide to take).

Wealth or financial freedom is a product of planning, saving, investing and time. Put simply, this is:

W = (P + S + I   + C) x L

Wealth = (Planning + Saving + Investing + Compounding) x Leverage

Let’s break this formula down into smaller increments.


Wealth is something that is very subjective and means different things to different people. I challenge you to write down your definition of wealth and what degree of wealth you genuinely, passionately NEED and are committed to make happen in your life. This one step is what took me six months, because I knew that making this one defining decision would change everything.


Planning is sometimes called goal setting, creative visualisation, budgeting, or even zero-base costing.

A long term study was made on the importance of setting and writing down goals or plans and a survey was conducted on the graduating class of Harvard University in 1953. Twenty years later, a team of researchers interviewed the graduating class of 1953 and found that the 3%, who had written down their goals, were worth more financially than the other 97% combined.

This survey tells us a lot about human nature and the need to achieve. If someone is not thinking about and focusing on what they really want, (whether that is in the financial world, on a relationship front, or in a spiritual context), the chances of achievement will be very slim.

Most people go through life reacting to situations and circumstances around them. If you allow your life to drift in this fashion you will die without any sense of achievement. On the other hand, if you systematically set yourself goals, both large and small, then actively go about achieving those goals, your life will be automatically fulfilling.

Goal setting or planning is a tool for measuring success. Without a measuring stick how can we determine whether we are successful?

Whether we are meeting our own expectations? Whether we feel fulfilled and satisfied by our achievement?

The process of successfully determining your goals involves the combining of dreams, thoughts, and emotions, into one determined and focused commitment.


Saving for many of us is a dirty word – a bit like budgeting and going to the dentist. Yet, in reality it is one of the most powerful tools you can employ especially when you combine it with time.

There is a wonderful book called “The Richest Man in Babylon” by George Clason and I would recommend everyone read it, if you haven’t already. It is written in fable format with each chapter containing a message.

The fundamental theme running through the book is to always pay yourself first. Always put aside 10% of your gross income for saving and investment before you do anything else – before you pay tax, before you buy the groceries, pay the mortgage, go out to dinner, etc.

We always recommend that you seek professional advice as this blog is for general information only