Wealth System Deconstructed: Matt McDonagh
As a THANK YOU to the paid members, we are adding a new special feature: Wealth System Deconstructed.
Starting with our family office, this series will break down the configuration and operating strategies used in different wealth systems. We’ll be looking at the wealth building efforts of investors and entrepreneurs, past and present.
Wealth System Deconstructed: Matt McDonagh
Hi, I’m Matt McDonagh. I’m a data engineer, tech investor, writer and builder. My family is the reason I build. My highest mission is to take care of my sweetheart and provide for all the people I love. Along that path, I believe wealth offers increased ability to protect your circle and generate opportunities. That’s why building wealth is such a worthwhile goal; not for show, but to build a fortress of resources.
I’ve always been a systematic thinker, and building the fortress became a system engineering exercise that I obsessed over for nearly a decade and still think about frequently.
The main components of my wealth system are:
Income Engines
Capital Appreciation Engines
The system starts with savings. Making money isn’t how you build wealth, keeping money and using money to make more money is how you build wealth. This requires you to budget tightly and save consistently, in order to achieve that you must pay yourself first. Make automatic contributions to an emergency fund & an investment fund every time you receive income (paycheck, distribution from a business, dividend, etc..).
While BTC is where we store most of our wealth to protect it from central banking-induced inflation, income is still required to live!
Income comes with tax profile consequences, and while income is great… remember the mission is to pass multi-generational protection, a large basket of options and wealth to my family. For that reason I advocate building multiple “wealth engines” — some built to generate income, others designed for multiple expansion aka capital appreciation.
You can even layer these engines together, like so:
dividend income portfolio
write options atop the dividend portfolio
capital appreciation portfolio
e-commerce businesses
Now let’s pop the top off and explore each of these engines in more detail. I’ll also highlight how they interconnect, support and reinforce each other. That is the key: getting the financial power in one engine to add energy to the other wealth engines.
First we’ll start in the financial markets and then move into entrepreneurial pursuits.