Advertisement
savings

The Best Way to Build Wealth

Get into the habit of saving and investing early.

One of my favorite contestants on Bravo TV’s Top Chef Masters last summer was Lorena Garcia. Not only were her food and her personality appealing, but she also seemed familiar. Where had I seen her before? And then it hit me: on the cover of Kiplinger’s. In March 2007, Lorena was one of 11 success stories we profiled in "How to Make a Million." An immigrant from Venezuela, she was making a name for herself as a chef and restaurateur in Miami and as a cooking-show host. Five years later, she was a celebrity chef in the semifinals of a nationwide U.S. competition.

SEE ALSO -- QUIZ: Do You Have What It Takes to Be a Millionaire?

You can also see Lorena in commercials promoting Taco Bell’s new Cantina Bell menu, a healthier fast-food alternative that she helped develop. (I couldn’t resist trying the menu—I recommend the cantina bowl with chicken.) So for this month’s cover story on how to strike it rich, it seemed natural to follow up with her to see how she had managed to become an even bigger success story.

Advertisement - Article continues below

"It’s been a fantastic ride," says Lorena, who has opened airport restaurants in Miami and Atlanta (another one is planned for Dallas–Fort Worth) and is working on her second cookbook. But it also means "not sleeping, not having days off and being away from family," she says. (When I spoke with her on February 20, she had just arrived home after being on the road since December 30.)

Advertisement
Advertisement - Article continues below

The food business is notoriously backbreaking, but Lorena’s recipe for success applies to other entrepreneurs who are trying to turn their talent or their bright idea into a fortune. "The right way to go into business is to know your craft," she says. "If money is your focus, forget it. You need to love your business to give it the time and attention it deserves, and then the money will come."

Building wealth. The same rule applies even when you’re working for someone else and investing your money. In a survey by Phoenix Marketing International, 75% of affluent households said the source of their wealth was earned income or investment returns. The best way to build wealth is to get into the habit of saving and investing early and to keep it up. For ideas, take a look at our cover story and also at the Kiplinger 25, the annual list of our favorite mutual funds.

Advertisement - Article continues below

In updating our list, investing editor Manny Schiffres and senior associate editor Nellie Huang were faced with an enviable problem: Our funds had done too darn well over the past year—or, as Manny put it, "we have no stinkers." But given our readers' desire for higher returns—and the risk that bonds could lose value if interest rates rise—Manny and Nellie decided to buff up the bond funds by adding more choices and more flexibility.

They start the process by intensively screening funds, says Manny, then adding their own analysis and judgment (and often sparring with each other). For example, they wanted to add Osterweis Strategic Income, a go-anywhere bond fund that specializes in high-yield bonds with a short-term focus. But which fund to bounce? The venerable Loomis Sayles Bond? Or Harbor Bond, a Pimco Total Return clone? "How can you diss [manager] Bill Gross?" Nellie wondered. In the end, they removed Loomis Sayles, historically a more volatile fund. (See our Fund Watch column Loomis Sayles Bond Preps for Rising Interest Rates for more.)

You can use our funds to create your own investment mix and follow Lorena’s recipe for success: "If you have a vision and drive, you can conquer anything."

Advertisement

Most Popular

12 Tax Deadlines for July 15 (It's Not Just the Due Date for Your Tax Return)
tax deadline

12 Tax Deadlines for July 15 (It's Not Just the Due Date for Your Tax Return)

Between due dates for paying estimated taxes, IRA or HSA contributions, and other deadlines, there's more to do by July 15 than just filing your feder…
July 14, 2020
65 Best Dividend Stocks You Can Count On
stocks

65 Best Dividend Stocks You Can Count On

These 65 Dividend Aristocrats are an elite group of dividend stocks that have reliably increased their annual payouts every year for at least a quarte…
July 8, 2020
91 Top Dividend Stocks From Around the World
stocks

91 Top Dividend Stocks From Around the World

These 91 Dividend Aristocrats, from the U.S., Canada and Europe, are among the world's top dividend stocks for payout longevity and safety.
July 13, 2020

Recommended

How to Navigate Emergency Funds in Urgent Times
savings

How to Navigate Emergency Funds in Urgent Times

COVID-19 has revealed cracks in many people’s financial plans, and emergency funds have never been more important.
July 12, 2020
Resources for alternative forms of transportation needed by many older adults
retirement

Resources for alternative forms of transportation needed by many older adults

For many older adults, having an alternative mode of transportation may be the difference between independence and social isolation.
June 29, 2020
Find the Best Money Market for You
money market accounts

Find the Best Money Market for You

Whether you choose a money market fund or account largely depends on the money's purpose.
June 24, 2020
Check Your Financial Adviser Now (and Every Year) or Regret It Later
wealth management

Check Your Financial Adviser Now (and Every Year) or Regret It Later

Fewer than 10% of investors use free background checks like Investor.gov, BrokerCheck or IAPD to check their financial advisers’ backgrounds. These on…
June 23, 2020