Filling The Right Prescription For Wealth Building

B.E. gives this year's financial fitness contest winners a check-up

LifePoint (AMEX: LFP).

The Lomaxes were off to a good financial start prior to our contest. Besides buying shares of Home Depot, they invested $100 a month in an equity-growth mutual fund.

June Winners: Anre and LaSharn Faush
The Rev. Anre Faush and his wife, LaSharn, are on a mission to create a financial legacy for their four children, Christopher, 12; Jasmine, 9; Ashlee, 7; and Christen, 6. While it has been only a few months since they won the contest, the 30-something couple is taking to heart DOFE principle No. 6: teach business and financial principles to your children.

The younger Faushes are now exposed to their parent’s investment plans and the family’s finances. They’re also getting a lesson on the importance of earmarking allowances and cash gifts toward a savings account. This Christmas, the younger Faushes may even get the gift of stock.

To help jump-start their children’s college education, the Rev. Faush and his wife used their $2,000 contest winnings to invest in two IRA mutual fund accounts (sort of his and hers). They invested half of the money in Putnam Equity Growth fund (which they had prior to the contest), and the other half was invested in Putnam Opportunity Fund, an aggressive growth fund.

The couple also opened a Roth IRA, as suggested by James Walton, a registered financial advisor and managing partner with Birmingham-based Financial Solutions Network. For educational purposes, funds can be withdrawn from a Roth IRA penalty-free.

The Faushes have $50 a month automatically withdrawn from their checking account to be deposited into the IRAs. They are also investing $100 a month in a money market account.

The couple has made great strides in reducing their debt by nearly 50%. He now owes $1,000 on a car loan for his minivan and she owes $1,600 on her credit card balances and more than $3,000 in student loans. They have also done a better job of monitoring their spending and trying to identify additional dollars, not an easy task since LaSharn left her job to return to college full-time.

For these contest winners-and others-to reach their financial goals, they must adopt all 10 of the DOFE principles. They should also monitor their portfolios constantly and make adjustments when necessary. Changing family situations, such as marriage, divorce, a six-figure college education for children, aging parents’ needs, or career moves can put a damper on anyone’s finances. As our contest winners are learning, the best way to handle change is to prepare for it through planning, discipline, and, ultimately, perseverance-the qualities needed to ensure your ongoing financial health.

You alone must take the steps to change the financial direction of your life. Wealth equals options and opportunities. Don’t wait for the right time to start investing, or you might just run out of time. Now is the best time to implement your personal wealth-creation plan. Start by mapping out your short-term and long term goals, mastering your money, and building a solid portfolio. Of course the earlier you get started, the better your chances of

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