A Holistic Approach to Financial Independence
The Elemental Wealth Planning System is a holistic financial life-planning system that incorporates mindset, structure, and a proven process to help individuals and families support themselves on their journey toward financial independence and resilience.
The System is designed around the three primary dimensions of household wealth: Person, Portfolio, and Possessions.
Using a cycling process that systematically works through the traditional elements of a financial life plan, using a household’s life purpose and vision as the guide in developing planning strategies and tactics. The system is action-oriented, focused on helping users achieve their most important life goals.
Many individuals have difficulty grasping the various details (elements) of a comprehensive financial life plan, as well as financial concepts and terminology in general. To help users better grasp financial concepts and terminology, we have incorporated a metaphorical approach into the design of the Elemental Wealth Planning System. We believe this unique approach makes the information presented more “sticky” and more likely to be applied by users.
Purpose: The Foundation of Financial Planning
At the heart of the Elemental Wealth System lies Purpose. A clearly articulated vision and well-defined life goals are essential to effective financial planning. Without them, we risk working, saving, and investing without direction, leaving ourselves vulnerable to external influences and competing priorities.
Every individual and family faces a fundamental choice: pursue your own carefully considered agenda, or risk becoming part of someone else's plan.
Discovering Your Vision
If you're uncertain where to begin, start with these three essential questions in order:
- What do I want to BE?
- What do I want to DO?
- What do I want to HAVE?
The sequence matters—think BE, DO, HAVE, in that order.
Experience shows that possessions hold diminishing significance as we age. Material things require ongoing energy to acquire and maintain. Research demonstrates that individuals who focus on who they are and aspire to become, on meaningful activities, and on relationships—rather than solely on accumulating possessions—experience happier, healthier, and more fulfilling lives.
We help our clients articulate their vision and goals, shaping how they envision their lives and their families' futures unfolding. From this foundation, we craft a comprehensive financial life plan and wealth management strategy designed to help you realize what matters most.
Wealth: A Three-Dimensional Approach
The Elemental Wealth System focuses on three distinct types of wealth:
Person Wealth
Person Wealth comprises three essential components: Capacity (health), Capabilities (knowledge and skills), and Connections (relationships and networks). Our ability to build Portfolio and Possession Wealth depends fundamentally on our Person Wealth—particularly early in our working lives and outside of inheritance or windfalls.
Portfolio Wealth
Portfolio Wealth encompasses financial assets including cash, investments, and where applicable, income-producing real estate and business interests.
Possession Wealth
Possession Wealth includes non-portfolio property such as primary residences, vacation properties, vehicles, and other personal assets.
Tax and Estate Planning
Taxation is an inevitable reality in Canada and most developed nations. Canadians pay taxes on income earned and consumption through sales taxes.
The Elemental Wealth System addresses three categories of tax:
• Person Tax
• Portfolio Tax
• Possession Tax
Person Tax
Person Tax encompasses income and consumption taxes associated with employment income, self-employment earnings, retirement income, and spending. Canadians pay income tax on net earnings and sales tax on goods and services consumed. Generally, higher earnings and greater after-tax spending result in increased tax obligations.
Portfolio Tax
Portfolio Tax refers to taxes paid on income generated from financial assets, business operations, and real estate holdings. This category addresses the tax implications of investment returns and business earnings that contribute to your overall wealth.
Possession Tax
Possession Tax includes taxes associated with acquiring and maintaining personal property such as real estate, vehicles, and other assets. These ongoing costs impact the true value of ownership.
Income tax can claim a significant portion of ongoing personal and portfolio income. Additionally, taxes may be payable on asset disposition at death. Strategic asset structuring and comprehensive estate planning—utilizing wills, trusts, and beneficiary designations where available—can help minimize estate taxes and maximize wealth transfer to beneficiaries.
Cash Flow: Fueling Your Vision
Cash flow is the fuel that powers your vision. After-tax income from employment, self-employment, or portfolio investments can be allocated toward spending or saving according to your priorities. While basic living expenses—housing, utilities, food, and clothing—must be addressed first, discretionary income provides opportunities for lifestyle enhancement and wealth accumulation.
The Elemental Wealth System divides cash flow into three categories:
Person Cash Flow
Person Cash Flow represents net income from employment or self-employment activities. This income can be directed toward consumption, acquiring and maintaining possessions, or saving and investing in portfolio assets.
Portfolio Cash Flow
Portfolio Cash Flow consists of net income from portfolio wealth assets—investments, business interests, real estate holdings, and retirement pensions. This income can be allocated to consumption, maintaining possessions, or reinvesting in portfolio assets. As personal earning capacity naturally decreases with age or health changes, portfolio wealth and cash flow become increasingly vital to financial security.
Possession Cash Flow
Possession Cash Flow represents funds spent acquiring and maintaining personal property. While possession assets rarely generate income, they typically require ongoing cash flow for ownership and maintenance.
Risk Management
Risk is an inherent aspect of daily life. While complete elimination is rarely possible, risk can often be minimized, managed, or transferred through strategic planning and insurance solutions.
The Elemental Wealth System addresses risk through three categories:
• Person Risk
• Portfolio Risk
• Possession Risk
Person Risk
Person Risk encompasses vulnerabilities faced by individuals and families, including illness, injury, or premature death. This risk is typically highest during younger years when Portfolio Wealth remains limited. Without sufficient income-generating assets independent of personal capacity, capabilities, and connections, individuals face significant financial vulnerability. For those with spouses and children, this exposure extends to the entire family unit.
Portfolio Risk
Portfolio Risk involves inherent volatility in financial assets, as well as business and real estate holdings where applicable. Investment markets experience natural fluctuations that impact portfolio values. Business operations face numerous challenges including economic cycles, competitive pressures, personnel issues, property damage, liability exposure, and theft. Real estate investments encounter many similar risk factors.
Possession Risk
Possession Risk relates to hazards associated with property ownership. Homes, vacation properties, vehicles, watercraft, recreational vehicles, and other assets are all susceptible to destruction or damage. Property owners also face liability exposure should someone experience injury or harm in connection with their possessions.
Through the Elemental Wealth System, we help you identify, assess, and address each of these interconnected elements to create a comprehensive financial strategy aligned with your unique vision and life goals.