assetbest 
With the Fourth of July coming up, I almost wrote another list of cheap ways to celebrate. Instead I want to focus on something more important: keeping the wealth you’ve earned. Learning to build wealth matters, but protecting it is just as crucial.
Recent headlines show how quickly a fortune can be lost. Paula Deen’s use of a racial slur cost her TV deals, book contracts, and licensing agreements. Aaron Hernandez has been accused of killing Odin Lloyd, a set of allegations that could destroy a multimillion-dollar career and a life. These are extreme examples, but they underline a simple truth: careless words and actions can wipe out years of work.
Making money takes time, effort, and dedication. Whether you build a brand or become a professional athlete, the rewards don’t come easily. Too many successful people squander what they have through hubris, greed, or bad choices. My own family has seen failed businesses and bankruptcies from poor decisions and lack of persistence.
Building wealth requires persistence and discipline. Losing it usually comes down to poor decisions. Here’s how to protect the money you earn, save, and invest:
1. Be conservative with most of your assets. Protect your wealth from excessive risk. Include safe holdings like government I bonds and keep a large cash cushion for emergencies. When you speculate, use only money you can afford to lose.
2. Think before you act or speak. Don’t buy into an IPO just because you use the product. IPOs are speculative; let a company prove several years of solid earnings and a clear growth plan before you jump in.
3. Contain losses when they happen. Everyone makes financial mistakes; the goal is to keep the damage small and learn from it. In my 30s my partner and I moved from expensive Southern California to much cheaper Indiana and bought a large new house without a basement. The job didn’t work out and we sold at a loss. We learned from that and next time bought an affordable home, stayed nine years, and sold for a profit.
4. Drop racist attitudes and close-mindedness. You miss out on too much when you shut people out. Be open to working with people from different backgrounds — you’ll find richer experiences and more opportunities.
5. Plan. Know what you want and how you’ll get there. Set goals, follow up, and keep going when roadblocks appear. Fix small problems before they become disasters.
Let other people’s mistakes motivate you to be smart with your money and your life. What financial mistakes have you made, and how did you recover?
