Most people think the road to wealth involves just saving. But 62-year-old Kermit Payne, the successful founder and chief executive officer of a strategic communications, marketing and association management company, says that saving is just one step on the road to wealth building.
Successful wealth building involves strategic planning and some financial risk taking by investing on the stock market—with assistance, of course, from trained investors and financial planners, says Payne.
“In terms of wealth building, we have to teach people the difference between saving and building wealth because you will never save and become wealthy,” he said. “That is one of the components of being financially illiterate; to think you can save into wealth is not how wealth is accumulated. You have to do something that’s active. That involves taking risks in the stock market and retirement plans and real estate. That doesn’t mean people should not save, but they should be working with a planner or adviser to help them build wealth through investing.”
Working with a reputable and trained investor is very important, especially when it involves your life savings. Conducting a background check on potential money managers, investors and planners should help give you peace of mind.
“Once you get into the wealth-building cycle, it’s much easier,” he said. “It’s just like saving. Once you start, it becomes part of your pattern.”
Besides saving and investing, a major stepping-stone Payne chose to help build his wealth was to open a business. Eleven years ago he founded the Atlanta-based 1Joshua Group, which primarily serves other businesses. A successful business can help build personal wealth, but the two are separate, Payne says.
“If the business is successful, my personal wealth looks a little different because it parallels the business revenue cycle,” he said.
During its first year of operation, in 2003, the company saw revenues of $500,000, Payne says. From that time, profits grew to about 28 percent in 2007, and then the recession hit, causing profits to plummet to nearly 3 percent in 2008, he said. Only in 2010 did the seven-employee company begin to see profits rise again. By December 2013 the company was turning a nearly 20 percent profit. Now he rakes in annual revenues of about $2.4 million.
Payne attributes his ability to weather the rocky shoals of the economy to hard work and perseverance. Before hanging up his own shingle, he worked for several decades as an executive in the public and private corporate sector, with his last position being chief executive of a nonprofit.