Pattie Lovett-Reid

Chief Financial Commentator, CTV

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The very rich tend to do things a little differently than the rest of us.

A new report of 700 high net worth individuals by U.S. Trust highlights just how much they have in common – and more importantly, things we could be doing differently to create wealth over time. Here are some examples:

Create long-term goals: This may be obvious, but you need to have a plan in place that you get excited about and use it as a benchmark to monitor your progress. If you don’t have a plan in place, it is very difficult to take corrective action to get back on course. Eight out of 10 surveyed were comfortable delaying gratification, believing investing in a long term plan provides greater satisfaction than short term wants and in some case needs.

Use credit strategically: Those who are financially savvy use credit strategically with two-thirds paying off their credit cards monthly, yet they align their card of choice with points or benefits they will actually use. That’s not all, if you happen to have a mortgage locked in at a ridiculously low rate, don’t accelerate the payoff, instead take any additional money you have and invest it into your retirement. It is about managing your whole balance sheet to your financial advantage.

Buy and hold: This strategy is alive and well. Despite calls that it is no longer relevant, 85 per cent say their biggest investment gains were through this strategy. Of course, good quality investments of both stocks and bonds helped to facilitate the process.

Make tax conscious decisions: Taxes should not drive your investment strategies but they are a close second. It is all about how much money you keep in your pocket.

Invest in tangible investments: Invest in something you can touch and feel, like real estate. In other words, invest in something that can produce an income and grow over time.

As the Chief Financial Commentator for CTV News, Pattie Lovett-Reid gives viewers an informed opinion of the Canadian financial climate. Follow her on Twitter @PattieCTV