This one is for our younger audience – share this with anyone you know who is in University or starting their career.

Let me tell you a story…

I have a friend, let’s call him John. John is 29 and worked at a prominent legal firm. Sadly, John fell ill and was put on sick leave for an extended period. After a few months of being unable to return to work, John lost his job – but thankfully, John had an income protection policy. The week he started working, his company requested (read forced) him to take out this policy. After paying religiously each month for several years, he was in a position where he had no income due to being unable to return to work. He wanted to cash out on his policy. I saw John 11 months after he lost his job, and he was still relying on his family to keep him afloat every month because his income protection had not yet paid out (because they were looking for every excuse not to pay – but can you blame them, that is their job)

So, after religiously paying monthly for a policy, the policy (and broker) could not do anything for John when the inevitable time came. But John mindlessly took out this policy without educating himself – rather, he followed the wrong advice and paid the price.

We have seen this happen repeatedly; still, people don’t want to listen and learn.

So, for the younger members of the Wealth Masters club and parents of university students entering the workforce, it’s crucial to understand two key elements of financial planning: the value of a Trust structure and the true cost of insurance policies.

The Importance of a Trust Structure

1. Future Planning and Wealth Preservation

Setting up a Trust early in your career can be a game-changer regarding future planning and wealth preservation. Trusts are a legal entity that allows you to protect and manage your assets. For young professionals and their parents, this means securing your hard-earned wealth for your children, family, and future generations.

2. Avoiding High Costs

One common mistake many people make is waiting too long to establish a Trust. As life progresses, transferring assets into a Trust can become expensive and complicated, involving legal fees and potential tax implications. By starting early, you can avoid these high costs and ensure a smoother transition of assets into the Trust.

Understanding the True Cost of Insurance Policies

1. The Rush to Purchase Policies

When young professionals start working and earning a steady income, there is often a rush to purchase insurance policies. While insurance is essential for financial security, many people may not fully understand the various types of insurance available, the cost implications, and whether they truly need them at a young age. Most of the time, they are blindly following the advice of brokers, who may just be after a commission (this is not always the case; there are good brokers… but not in the stories we have heard)

2. Educating Yourself

It’s essential to educate yourself about the true cost of insurance policies. This involves understanding the difference between life insurance, health insurance, disability insurance, and other forms of coverage. Assess your needs, and don’t be swayed by sales pitches or pressure to buy more insurance than you require.

3. Value of Proper Planning

Instead of hastily purchasing insurance policies, take the time to create a comprehensive financial plan. Determine your financial goals, assess your risk tolerance, and establish a budget. This plan will help you identify the insurance coverage that aligns with your needs and goals, reducing unnecessary expenses.

Conclusion

My advice is very simple. EDUCATE YOURSELF!

For young members of the Wealth Masters Club and parents with children entering the workforce, setting up a Trust early and making informed decisions about insurance policies are vital steps in securing a prosperous and secure financial future. But even more important is to understand how it all works.

As we approach November, we are gearing up for our last round of full-day seminars (in Johannesburg, Cape Town and Durban). As a gift to our members, we have the following special:

• Members only pay R899 for a ticket to the seminar (that’s a saving of 60%)
• Bring Your Kid For FREE – if your child is between the ages of 18 and 21, you can bring them with you to the seminar at no cost.

If you want to take advantage of this deal, please email [email protected]

I urge you to take this final opportunity to learn and protect yourself. Start early and get the right structures in place for your needs, not according to what someone wants to sell you.

And remember, we also have a book that was written for the younger audience, which explains the importance of the right structures and how we do things. Buy that as a gift for younger people that you know – I can promise you, it will be the best gift you’ve ever given them (I know it changed my life)

You can order a copy of the book by clicking on the button below