The Wealth Triangle

   Inheritance 

There are four ways inheritance comes

1. Will – s a legal and enforceable declaration of how a person wants their property and assets distributed after death

2. Trust – A trust is a relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary.

3. Life Insurance – A life insurance contract guarantees the insurer pays a sum of money to named beneficiaries when the insured policyholder dies, in exchange for the premiums paid by the policyholder during their lifetime.

4.Annunities – Annuities are contracts issued and distributed (or sold) by financial institutions where the funds are invested with the goal of paying out a fixed income stream later on. Some annunities have riders that may benefit your heirs. 

​Income 

There are three types of income:

1. Earned Income – Income derived from employment or self-employment. Earned income usually includes wages, salaries, commissions or bonuses. It is the highest taxed income and the most difficult to build wealth with.

2. Portfolio Income – Income commonly derived from paper assets, such as stocks, bonds, mutual funds and commodities. Dividends and capital gains are types of this income. Portfolio income is taxed at a lower rate than earned income. Dividends and capital gains are types of this income.

3. Passive Income – Income derived from real estate investments. It can also come from royalties and licenses. This the lowest taxed income. This type of income generally requires work upfront. 

Investment

There are seven kinds of investments

1. Paper assets – Stocks, bonds, mutual fund, retirement accounts, mortgages, etc.  

2. Real Estate investments – Duplexes, Triplexes, Fourplexes, Apartments, Condos, etc.

3. Business assets – Corporations, Partnerships, Sole Proprietorships, etc.

4. Cryptocurrencies – Bitcoins and Altcoins.

5. Commodities – Gold, Silver, Wheat, Gas, Oil, etc.

6. Antiques – Arts, Automobiles, Furniture, etc. 

7. Intellect property – Royalties, Patents, Copyrights, etc.