Perpetual Wealth Strategy and The Wealth Maximization Account

About this Episode

In a conversation between Patrick Donohoe and John Stewart, two experts from Paradigm Life, we gain valuable insights into how a paradigm shift in one’s financial perspective can lead to a more secure and prosperous future.

Key Takeaway Timeline

  • 01:07 Why do clients seek out Paradigm Life?
  • 04:24 How do we form our perspective on money?
  • 07:55 The three main obstacles that could prevent you from achieving your financial goals..
  • 12:07 How emotion and incorrect asset allocation impact your wealth building.
  • 15:42 How your life’s paradigm could be limiting your financial progress.
  • 17:48 How the Perpetual Wealth Strategy changes your life’s paradigm to overcome the three obstacles.
  • 21:18 Who is John Stewart, and why should you listen to him?
  • 23:03 How Paradigm Life can help you.
  • 25:15 What to expect in the next Wealth Maximization Account episode.

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01:07 Why do clients seek out Paradigm Life?

Patrick Donohoe: Hi everyone. Today, I’m here with a good friend and colleague of mine, John Stewart. John, how are you doing?

John Stewart: I’m doing great, Pat.

Patrick Donohoe: That’s great. It’s great to have you. It’s going to be an awesome conversation. You know, when I mention Paradigm Life a lot of people mispronounce paradigm. Someone the other day said, “par-a-dig-em.”

John Stewart: “Dig-em?”

Patrick Donohoe: Yeah! It was actually Steve Covey who popularized the idea of a paradigm. A paradigm is the way in which you view the world, right? Your perspective of life. It’s the context in which you fit essentially all information, whether it’s financial, which we’re going to speak about today, or other elements of life. So, I feel that it’s really important.

And because John is one of our most successful Wealth Strategists here at Paradigm Life and has worked with thousands of clients over the years, it’s important for our audience to understand the perspective that we bring to them, the perspective that we continue to refine. But that perspective is paramount because it brings about a strategy, a way in which clients can achieve what they want financially.

It’s the financial future they’ve dreamed of, the criteria behind that end result, which is certainty. It’s not rolling the dice and hoping it all works out. It’s strategic. We establish checking your wealth so that it can materialize with the highest degree of certainty possible and actually be the wealth that’s going to give you the financial future you’ve hoped for.

So, John, I celebrate you because you have been with us for 13 years—since 2010. It’s been an incredible journey with you. And it’s awesome to hear the experience that so many clients have had with you. They’re able to really see what’s possible for them financially. 

Clients typically come to us because they want something, right? So maybe expand on what I just said regarding a financial future with certainty, a financial future they’ve dreamed of. Sometimes, people just don’t see what they’re capable of or what’s possible for them.

But I feel like our philosophy of life and our perspective of life, not just within the financial world, allows them to peer into a future that we help give them the confidence to create for themselves and their families.

John Stewart: Yeah, well, that’s a big subject. You know, so many people spend the majority of their time learning about their career and becoming an expert there. The goal for most is to have a good career, a good job, or a successful business. Now, it’s really about putting that money away and growing that wealth to where they have financial freedom and control over what they put together. Just because our time is spent on the business or our expertise, there’s often not a lot of time spent on wealth creation and, ultimately, wealth preservation.


04:24 How do we form our perspective on money?

Patrick Donohoe: Look at you. You see these trends. You also mentioned some key points. I look at where people form the way they view money. In large part, it’s influenced by their parents, their family, and the social circles they were raised in. And unbeknownst to them, it wasn’t done by design.

They come to certain conclusions about what to do with their money, such as: Is a lot of money good, or is a little money bad? Should I pursue wealth or not? People have these intuitive beliefs when they approach the subject of money, and these beliefs were designed by factors they didn’t consciously choose.

John Stewart: There are no bad investments, there are only bad investors. They simply picked the wrong tool. It’s like, you know, they see their dad hit their thumb on the nail with a hammer and go, “I’m never going to use a hammer again.” A very powerful tool can be used the wrong way, and even when used the right way, it can hurt us. We form opinions on how to use it based on our experiences.

One of the hardest things for us as individuals is to take an unbiased approach and be agnostic about which financial tool to use, simply selecting the best one for the job. That’s what we try to do here. But one of the biggest hurdles most people have is getting rid of their preconceived notions about what it’s going to look like or what they have to use to achieve their end goal.

Patrick Donohoe: Yep. So, I look at the way in which we view a healthy financial life, getting people to this desired end result. It’s not a single-dimensional approach. It’s multidimensional because there are many different aspects of financial life that work together. But most people are taught specific products, strategies, or ways of doing things that are single-dimensional.

Without essentially having a strategy around the other dimensions of finance, those dimensions are what can ultimately disrupt what they’re doing and what they’ve learned. For example, maxing out your 401(k) and putting all the money in the stock market, while it may not be a bad strategy, can be disrupted by events like disability, job loss, market volatility, divorce, or a lawsuit.

These are things happening in other dimensions of finance that could potentially disrupt what you’re focused on in that single dimension.

John Stewart: Absolutely. Most financial tools that are being taught, like you say, are single-dimensional. The financial world, Wall Street, and banks would love to put everybody in a box and make it very simplified by putting everybody on the same path, which could be a great path for some but holds many others back from their ultimate financial goals.


07:55 The three main obstacles that could prevent you from achieving your financial goals.

Patrick Donohoe: At Paradigm Life we’ve had experience with thousands of clients since 2007. We’ve explained their macroeconomic life, their holistic life, and all dimensions of finance into three primary categories. These categories become the obstacles that prevent people from achieving their desired outcomes.

The first category is cash flow, which refers to the money coming in and out of your financial life. Positive cash flow allows for saving and investing, while negative cash flow leads to debt. It’s crucial to have a healthy cash flow, which involves having a spending strategy that balances saving and spending appropriately.

The second category is protection. Wealth accumulation involves starting to invest today with the expectation that wealth will compound over time. However, life events like health issues, divorce, job loss, or market volatility can disrupt this wealth-building process if you’re not adequately protected. Protecting your financial life is essential for wealth materialization.

The third category is wealth itself, which includes various financial products and investments. Many people believe that taking high risks leads to high rewards. However, we use a tool called the Hierarchy of Wealth to help clients visualize the risk associated with their investments and assets.

Balancing risk is crucial in wealth management. These three areas, when healthy and balanced, allow your wealth to materialize with certainty and help you achieve your financial goals.

John Stewart: Absolutely. The Hierarchy of Wealth helps us balance different asset classes. For instance, during the 2008 financial crisis, when stock and property prices dropped, those without proper allocation were forced to sell at a loss. Being in a forced situation, whether buying or selling, typically results in unfavorable outcomes.

Proper allocation and the Hierarchy of Wealth enable individuals to make better decisions. If someone held onto an asset like stocks or real estate from 2008 to 2018, they likely saw significant gains. In contrast, those who were forced to sell incurred losses due to improper allocation. Wealth can be deceptive if not adequately managed.


12:07 How emotion and incorrect asset allocation impact your wealth building.

Patrick Donohoe: It’s inevitable that things won’t always go as planned in life. While we strive to establish a wealth strategy, protect ourselves, and ensure cash flows, unexpected challenges can arise. These obstacles can create emotional responses, and these internal emotional reactions often lead to irrational decisions.

These emotional states, such as frustration, anxiety, and fear, triggered by external circumstances not going as expected, can result in poor financial decisions and impact other aspects of life, including one’s profession, relationships, and health.

A healthy approach to life considers these dimensions of finance and provides a foundation to navigate life’s changes, challenges, and uncertainties, allowing individuals to find meaning in their experiences.

John Stewart: Having a clear strategy and plan is more critical than ever in today’s fast-paced and emotional world. With the ability to buy and sell quickly, both goods and investments, emotions can drive impulsive decisions, often leading to poor choices.

Having a plan helps eliminate emotion-driven decisions and ensures that every financial move aligns with the overall goal. It provides a macro perspective to counterbalance the micro-events that occur in life.

Patrick Donohoe: Our philosophy has evolved over time, and we’ve seen how our principles relate to real-life situations. When you strike a healthy balance in your financial life, challenges become opportunities rather than restrictions or problems.

For example, during the 2008 financial crisis, those with liquidity could capitalize on opportunities while others suffered the consequences of putting all their resources into one investment.

It’s crucial to understand how your financial paradigm is formed, including your view of wealth and life, to navigate these challenges effectively.


15:42 How your life’s paradigm could be limiting your financial progress.

Patrick Donohoe: Most people don’t strategically design their financial life. It’s often influenced by various factors, such as parents, environment, and the influence of financial celebrities and authors. While many have good intentions, there’s often a lack of a macroeconomic perspective that effectively integrates three crucial areas: capital, protection, and wealth.

Typically, people focus narrowly on specific investment strategies or products rather than considering the broader context of wealth as a whole. Financial products are indeed relevant, but they should fit within a comprehensive financial strategy that includes insurance, spending strategy, and more. Different stages of one’s financial life require different approaches and products.

Many individuals find themselves in a financial situation they didn’t consciously design, and the results they’re currently experiencing may not align with their goals, even if they are decent. The key is to change one’s financial paradigm and perspective to ensure a healthy balance of these financial life areas, resulting in desired outcomes with a high degree of certainty.

John Stewart: Ultimately, you’re either following your own financial plan or someone else’s. If you don’t actively plan, you’re essentially adopting someone else’s financial strategy by default.


17:48 How the Perpetual Wealth Strategy changes your life’s paradigm to overcome the three obstacles.

Patrick Donohoe: The Perpetual Wealth Strategy is a concept that has evolved to help our clients live the life they deserve in the modern era. We approach financial life by evaluating three key areas: cash flow, protection, and wealth. Cash flow involves strategies to optimize income, save on taxes, and manage spending responsibly. Protection encompasses safeguarding assets, whether it’s personal or business assets, estate planning, or liability coverage. Wealth-building focuses on generating returns without taking excessive risks.

Embracing the Perpetual Wealth Strategy aims to maximize wealth with a high degree of certainty. It’s an approach that guides how we view financial products and strategies. Our goal is to help clients achieve the most wealth possible while managing risk intelligently.

John Stewart: I love it.

Patrick Donohoe: My own journey into this perspective wasn’t predetermined. I grew up in a household of two schoolteachers and initially aimed to follow in their footsteps. However, circumstances led me into the financial services industry in 2007, where I eventually founded Paradigm Life. Over the years, working with thousands of clients and witnessing their financial behaviors, I recognized recurring patterns and obstacles.

Prior to Paradigm, I even spent time in a call center helping people consolidate high-interest debt, which exposed me to the financial challenges people faced. These experiences, along with the personal lessons I’ve learned, have shaped our strategies. We bring these strategies to our clients based on real-life experiences and understanding.


21:18 Who is John Stewart, and why should you listen to him?

Patrick Donohoe: John, you have an incredible story, and it’s fascinating to explore what led you to Paradigm. While both of us arrived here from different backgrounds, we’ve reached very similar conclusions.

John Stewart: Indeed. My father’s upbringing during the Great Depression left him with a dual perspective on finances – a strong ability to produce and a lingering sense of scarcity. This duality has been a lifelong battle for him, and it’s interesting because, in a way, we all believe our financial journeys are unique. However, regardless of our past or current situations, the principles of cash flow, protection, and wealth are universally applicable.

As you mentioned, we might have taken different paths to get here, but these principles remain constant. It’s a unique experience for our clients to realize the universality of these principles and apply them to their own lives. The results are consistently positive, no matter their individual goals.


23:03 How Paradigm Life can help you.

Patrick Donohoe: Most people don’t approach their finances in the way we do. What keeps us going is our ability to help clients solve problems, optimize their existing financial situations, and maximize their strengths to lead the most meaningful life possible. Clients often come to us after experiencing financial frustration, anxiety, or hardship, emotions that can impact other important aspects of their lives.

One fulfilling aspect of our roles is witnessing the transformations in our clients. They often start with a certain feeling about their finances, but as they establish a more macroeconomic strategy that optimizes their cash flow, ensures comprehensive protection, and builds wealth with balanced risk, they undergo positive changes.

Life unfolds, and we have a snapshot of it today, but by adhering to principles and continually modifying and iterating on their strategies, clients can adapt to life’s unpredictable nature and capitalize on opportunities.

It all comes down to principles that underlie the strategies one implements. When these strategies are based on solid principles, they are more likely to manifest and materialize successfully.

John, it was great to have you on this episode. We are passionate about these topics, and we live and breathe personal finances every day. Our goal through this podcast series is to teach and inspire you to take your wealth to the next level. Thank you for joining me today, John.

John Stewart: Thank you.


25:15 What to expect in the next Wealth Maximization Account episode.

Patrick Donohoe: As we delve into this educational series titled “Wealth Maximization Account Mastery,” we will be emphasizing the perspective we’ve discussed today. Our core financial product, the Wealth Maximization Account, which is essentially a high cash value life insurance policy, is versatile and applicable to nearly every aspect of your financial life.

In the upcoming videos, John and I will share stories and anecdotes to illustrate how this foundational financial product can help you achieve the wealth goals you rightfully deserve. We invite you to stay tuned and join us for the next videos in this series.

About Patrick Donohoe

Patrick H. Donohoe IAR, AIF®, RFC®

Over two decades of experience in the financial services industry, Patrick has seen the challenges people face in managing cash flow, risk, and investment performance – especially for business owners, real estate investors, and entrepreneurs. The struggles lead to continuous uncertainty and unease, – negatively impacting the areas of life where they have the most significant impact.

At Paradigm Life, where Patrick serves as CEO, he leads the company mission of helping Clients overcome these challenges through proven, economically sound, and time-tested strategies. Since 2007, Paradigm Life has guided over 8,000 clients nationwide to new levels of financial independence, helping them create and follow a path to thrive personally and professionally.

Patrick’s journey into the financial industry was unique. Growing up in a middle-class area in central Connecticut, the child of two teachers, he wasn’t taught much about money, investing, or business. His interest in finance was sparked by studying Economics & Statistics formally and reading Rich Dad Poor Dad in 2002, which opened his eyes to the financial potential of all human beings.

Patrick’s first real taste of personal finance came during college, where he worked in a call center that provided debt consolidation strategies as an alternative to bankruptcy and, later, in the mortgage industry.

He founded Paradigm Life in 2007 and, like many during the 2008-2009 financial crisis, learned firsthand about the unpredictability of the business environment and economy. That period tested him but also shaped him. Amidst the struggle, he worked tirelessly, providing consultations and webinars to help people navigate the financial storm. In 2011, those efforts started to bear fruit, allowing him to expand his team and build a strong company culture.

This journey compelled Patrick to write “Heads I Win Tails You Lose – A Financial Strategy to Reignite the American Dream” in 2018. The book encapsulates his financial philosophy and the wealth strategies Paradigm Life uses with Clients, rooted in his career experiences. To date, the book has sold over 60,000 copies.

Patrick also co-hosts several podcasts with over 1,000 episodes combined.

As a veteran of the industry, Patrick gets the challenges Clients face. His personal and professional experiences have equipped him to guide others through the complexities of personal finance. While he is passionate about numbers and objective analysis, he strives to prioritize making financial theories accessible and practical for Clients without getting lost in the complexity.

On a personal note, Patrick has been happily married since 2003 and has three children. He’s a Utah Jazz fan, plays Ice Hockey, and loves spending time in the mountains with his friends and family.

A Wealth Maximization Account is the backbone of The Perpetual Wealth Strategy™