There's more to wealth than money: How wealthy are you?

Estimated read time: 4-5 minutes

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SALT LAKE CITY — A child comes home from school one day, and while eating his snack asks his mother, “Mom — so how wealthy are we really?” Junior high conversations can sometimes become petty and superficial, so mom digs deeper into the question. “Why do you ask son?” He says, “Well, I notice that some of my friends have really expensive basketball shoes and some of them even have an iPhone. I just wonder if that means that they are wealthy.”

While this conversation may have never happened in your home, it is a topic that needs to be addressed. Tommy Oliphint, a financial advisor at Grand Purpose Advocate from San Antonio, Texas, asks his clients, “What makes you wealthy?” How is it achieved? How is it measured? As simple as it sounds, many struggle to answer it.

The true measure of wealth is not found on a balance sheet or in the clothes that one wears. To truly understand how wealthy a person or a family is, one must examine six key indicators.

Theme 1: Financial literacy — intellectual capital

The person that understands and is informed about how they earn, spend and invest their money is a person that has a chance to accumulate significant wealth. Knowing how to make money, save money and consume less than you make is a lost art and one that can pay great dividends to an individual and a family.

Theme 2: Talent discovery and pursuit — human capital The individual that is aware of their talents as well as their weaknesses has a great advantage. The ability to discover natural abilities and to pursue those attributes at a young age will give an individual a head start on developing true wealth. People that find a career that uses their talents find satisfaction, can become more successful and engaged than many of their peers.

Theme 3: Mentoring — relational capital

The opportunity to discover true wealth is often found through someone else making an investment in us and assisting us to find the people, resources and education necessary to accomplish meaningful goals. No matter the pursuit, a person that has a mentor that invests time and energy to develop them is usually far ahead of the person that is pursuing success on their own. The opportunity to learn from someone else’s mistakes and experiences can shorten the runway to accomplishing great things. Certified Financial Planner Ross Polking said, “We’ve found that success is exponentially enhanced by the quality of people you surround yourself with. Don’t go at life alone.”

Theme 4: Philanthropy — social capital

The happiest and most successful people in life have a clear understanding of where their blessings and good fortune come from. Finding ways to give back to others who are less fortunate can be an inspiring and motivating factor to discover even greater success. As people take their minds off of their own needs, gratitude can enter their lives and everything in life begins to look a little brighter.

The happy irony is that by giving, we ourselves become wealthier. I've seen it — philanthropy elevates both the receiver and the giver.

–Wes Mashburn, planned giving expert

Wes Mashburn, a planned giving expert at an internationally renowned non-profit said, “Philanthropy is more than just giving money. The happy irony is that by giving, we ourselves become wealthier. I've seen it — philanthropy elevates both the receiver and the giver.” Giving of your time, financial resources or unique talents to individuals and organizations are all ways to participate in philanthropy.

Theme 5: Attitude toward work — working capital

In order to be happy and productive in your pursuit, you must learn to love to work. Those that find satisfaction and joy from putting in a hard day’s work are more likely to achieve greater financial success. Learning to work at a young age is important for children, because they will be more likely to be able to resiliently push through hard things later in life if they have learned to work.

Theme 6: Physical health and wellness — physical capital

Does the way you eat make you feel healthy? Do you get enough sleep to function with energy and focus? Is exercise a part of your normal schedule? All of these factors affect how you feel and how you perform. Taking care of yourself physically will influence how you work, what you are able to achieve and how you think about yourself.

So how wealthy are you and your family? In what way can you make deposits into your “true wealth” bank account? What liabilities do you have in your life that you can get rid of to clean up your true-wealth balance sheet?

These six profiles make up a broader, more comprehensive view of what it means to be truly affluent. So what makes people wealthy? Take an introspective, honest look at your life and make the necessary changes to build real wealth for you and your family.

Dave Specht was a lecturer in family business management at the University of Nebraska-Lincoln. He also owns Advising Generations LLC, a multi-generational family business consulting firm. Dave is a speaker and writer on the topic. www.davespecht.com