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Protecting everything you've built? Strike three. To this day, two-thirds of Americans don't have the most basic of legal documents: a will. Or enough life insurance to take care of the people they love, should something unforeseen happen. But, again, this can be remedied relatively quickly and inexpensively. (Term life insurance prices have gotten so competitive, I just replaced my five-year-old policy with a new one and am saving hundreds of dollars a year.) 

What sets numbers 2, 3, and 4 apart is that although you may be fully capable of mastering these skills—and you may have one or more of them under control—they are things you can do sufficiently only after you have taken care of number 1—that is, after you have the money rolling in. And therein, as the Bard would say, lies the rub. Try as hard as you like to follow my advice—and I've been told I make understanding how to accomplish 2, 3, and 4 very easy—to track your spending, save automatically, and reduce your outstanding debt. Try to allocate your assets to perfection and pick winning stocks or mutual funds with low expense ratios. Try to secure your future with the right amount of term life insurance coupled with a well-rounded estate plan, a will, durable powers of attorney, and health-care proxies. Try all of this, but if you don't have the money—and you can't figure out a way to get the money—you are going to fail. 

A Swiftly Shifting Paradigm  

The good news, the very good news, is that this is a situation that can change—and quickly. Ten years ago, one in ten of the people who today describe themselves as financially comfortable were slipping further into debt each month, and four in ten were living paycheck to paycheck. In other words, half of the financially comfortable made their way not only out—but up. Ten years ago, 16 percent of the individuals who today describe themselves as wealthy were mired in debt. Only 13 percent were wealthy back then, which means that for a full 87 percent of them—nearly nine out of ten—wealth has been a recent phenomenon. 

And it doesn't always take ten years to make the leap. Those individuals who transitioned from living paycheck to paycheck into a life that's financially comfortable said it took an average of seven to eight years. Moving from financially comfortable to a life of wealth took just over eight on average. And making the big leap—from paycheck to paycheck to wealth itself—took about ten. That's the number of years Friends spent on the air. It's about the same time that a successful president spends in the White House. It's equivalent to the career life span of an NFL running back. In the scheme of things, it's a blink of an eye. And most people—no matter what strata they're living in right now—believe making that leap is possible. Are you one of them? Read on.  

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