High-net-worth wealth management looks different in a lot of ways than financial planning for middle-class families. For instance, high net worth families and individuals may choose to rely on their investments to provide a steady flow of cash to fund their retirement. They also need to make special considerations in regards to their tax strategies.
Avidian Wealth Management is a wealth management firm that has extensive experience meeting the unique needs of high-income individuals and families. In this article, we are going to suggest five strategies for high-net-worth wealth management.
What is considered “high net worth”?
A high net worth individual (HNWI) is anyone who has at least $1 million in liquid assets. Liquid assets are anything that can easily be converted to cash without losing its market value. This includes but is not limited to physical cash, any money in a checking or savings account, money held in a money market account, mutual funds, bonds, and certain types of stocks. Non-liquid assets such as real estate, cars, boats, or jewelry do not count towards this threshold.
5 Tips for High Net Worth Wealth Management
1. Customize your financial plan to your needs
When working with your wealth management advisor to create your customized financial plan, you’ll want to make sure that all aspects of your financial goals and needs are met. This could include everything from fiduciary investment management and tax planning to debt management, retirement planning, and more. Your financial plan should be an ever-evolving strategy as your goals and needs change over time.
2. Protect your assets
A good financial plan takes all possible risks into account including portfolio risks, unexpected life events, and business risks. Generally speaking, risk management is mostly considered during estate and insurance planning and/or when determining the amount of risk you are willing to take in your investment strategy. While determining the latter, you’ll also want to consider who will be responsible for your portfolio management.
For example, our team at Avidian proactively monitors, reallocates, or sells — as necessary — our client’s positions in order to optimize their portfolios while reducing risk. This allows our clients to spend time enjoying the life they’ve worked so hard to build rather than spending their time monitoring market conditions.
3. Incorporate retirement planning
Retirement planning is an integral part of your complete financial plan whether you’re ready to retire or not. This is especially true for high-net-worth individuals who plan on relying on their assets and investments to fund their retirement. Your lifestyle is a major factor in deciding how much you’ll need to save. This may include increases in your way of living if you plan on traveling more or getting a second home. Knowing this will help you and your wealth manager create a plan that aims to help you meet these financial goals.
4. Safeguard your wealth for future generations
Although it can be difficult to think about what happens after you’re gone, it’s a necessary part of comprehensive wealth management. You worked hard to build the legacy that you have, now it’s time to protect it for the next generation. The best way to do this is through estate planning in Houston. Aspects of your estate plan you’ll want to consider include your wills, beneficiaries, life insurance policies, business succession plans (if applicable), and trusts.
The second part of estate planning that’s not often spoken about is ensuring that you have prepared future generations to inherit the wealth you plan to leave them. Spend some time talking them through your financial plans, introducing them to your wealth manager, and getting them involved in the decision-making process.
5. Take advantage of charitable tax-benefits
Looking for additional ways to reduce your tax impact? Talk to your wealth management advisor about setting up tax-efficient giving accounts such as a donor-advised fund (DAF) or private family foundation. Both of these options act as a way to give back to the causes you care about while taking advantage of immediate tax deductions.
Depending on who you partner with for your accounts, funds, or trusts, you may even be able to donate some of your complex assets. This provides flexibility for charitable individuals who would like to remove the burden of selling their non-liquid assets and instead donate them to open a DAF.
Avidian Wealth Solutions offers customized wealth management in Houston.
Strategic high-net-worth wealth management that includes a customized financial plan, risk management, retirement planning, next-generation and estate planning, and charitable giving accounts can provide individuals and families with peace of mind for their financial future.
If you are looking for this type of customized wealth management, look no further than Avidian Wealth Solutions. We provide our clients with services including all of the above as well as high net worth tax strategies — all tailored to support and protect your financial future.
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