Protecting wealth is highly important for those who already have it and for those who are trying to build it. But there are some ways to protect wealth that are more rational and logical than others. Gone are the days when people hid a bunch of cash in their mattress because they didn’t trust the banks. Now, investments are made at banks and other financial institutions every day. Some people still don’t trust the banks, and there’s nothing wrong with keeping some cash on hand as well. But overall, you need to protect your wealth through smart investment and tax reduction strategies.
A Trust Can Help You Keep More
When you want to keep more of your money to give to others, such as when you have an estate plan, a trust can help you do that. When you want to keep more of your money to give to others, you may accomplish this through different ways. For instance, by setting up a trust. Make sure you work with a tax and legal a professional who can advise whether this solution is right for you. Typically, this would be a will and estate attorney. That way you’ll know that the trust is done right, and you won’t have to worry about a mistake that could potentially cost you or your heirs a lot of money in taxes at a later date.
Consider Giving, Including Charitably
If you want to make sure your wealth goes to the right people when you’re gone, you can give some of it away now. It will protect your wealth by putting it into the hands of the people or organizations you intended it for. Giving at that level isn’t for everyone, and it may not be your goal or plan. But for those who intend to share their wealth with family, friends or organizations, giving away money over a period of time instead of all at once may be a consideration.
Look for a Variety of Options
Your wealth shouldn’t be all in one spot. You don’t want to put everything you have into one account, one company or one investment vehicle. Instead, you should move things around and ensure that any risk you have is mitigated by not having everything in one place. The old saying about not putting all your eggs in one basket is very true when it comes to wealth building because that one basket could suddenly go away, leaving you with nothing. But if you have many baskets, each holding an egg or two, you’ve only lost a small portion of your wealth if that basket breaks. It’s a much safer strategy.
Consult With the Professionals
Ultimately, you should talk to a professional about securing and protecting your wealth. By working with someone who protects wealth for a living, you’ll be much more likely to reduce your risk, and you should be able to keep your wealth longer and help it continue to grow. That strategy will be beneficial for your future plans and any heirs who will be the recipients of that wealth.
Disclaimer: The information contained in this article is for general information purpose only and is not intended to be a source of investment advice with respect to the material presented. The ideas contained in this article should never be used without first consulting with your financial/tax/legal advisor.