Wealth Planning

High Net Worth Financial Planning: 5 Key Considerations

By
Dominion
Updated:
October 9, 2023
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8 min read
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For many Americans, crossing the financial line into high net worth territory – typically around $10 million – is a momentous achievement. You’ve worked hard to build your business or grow in your profession, and now you can sit back, relax, and enjoy your wealth. Right?

Not so fast. The truth is, the more money you have, the more you need to plan for its management and protection. Let’s explore five key considerations you should keep in mind as you look into high-net-worth financial planning with the expert advisors at Dominion.

Asset Protection – Have You Started it Yet?

As you accumulate wealth and property, you’ll become a much more attractive target for creditors, lawsuits, and even family members who want to go after your money. Therefore, you need to start looking into asset protection right now.

Asset protection can involve a few different steps, like:

  • Setting up a company with the right structure
  • Taking out insurance policies, such as life insurance, malpractice insurance, etc.
  • Setting up an offshore asset protection trust with the help of Dominion

So long as you have a good strategy in place, asset protection will ensure that your finances and your estate stay safe against frivolous lawsuits, aggressive creditors, and other legal threats on the horizon.

Make no mistake, sooner or later, you’ll be targeted for a court battle. But if your wealth is safe in, for example, an asset protection trust, it won’t matter if the lawsuit is successful. Your cash and other property will be secure for you and your kids, grandkids, and more. 

But robust asset protection is only possible with thorough financial planning. You need to find wealth managers and financial advisors who can help you develop and implement an asset protection plan at the earliest opportunity.

The Sooner, the Better

Asset protection won’t do you any good if you only start to practice it when you begin to need it. Instead, you need an asset protection strategy in place and functional well ahead of trouble.

Otherwise, you could get accused of fraudulent conveyance/fraudulent transactions or other illegal activities. 

For instance, you can’t give your brother $20 million the day before you are due to appear in court for a judgment – a judge will instantly know your game and demand that you pay the money anyway, plus additional fees.

Having your assets safe in an asset protection trust months before you are in danger of legal action, on the other hand, is a tried-and-true, foolproof strategy.

Your Wealth Should Work for You

As a high-net-worth individual, you should also know that your wealth needs to work for you. The more money you make, the easier it is to invest that money to generate ever greater sums.

For example, you can put your money into an offshore asset protection trust. But your trustee or trust manager can then invest a proportion of that liquid capital into various stocks, bonds, and projects. In the long run, your trust will create enough money not only to pay for its own management fees, but also to grow your estate with time.

This can be difficult to wrap your head around if you've recently come into a lot of money. But it's a truism of high net worth individuals who manage to stay high net worth – if you don’t invest your money wisely to grow it, you’ll eventually deplete it and be right back where you started.

What Are Your Long-Term Goals for Your Wealth?

Putting your money to work for you is one change you need to make in terms of how you think about wealth. The other is putting your mind toward long-term goals.

If you manage your money properly, you’ll have enough of it for the rest of your life and, even better, the lives of many of your descendants. So if you haven’t already, write down some of the long-term goals for your money and your estate. Here are some examples:

  • Do you want to pay for the college tuition of your kids, grandkids, or other family members?
  • What do you want to leave to your family members or other beneficiaries? Knowing this well ahead of time can help you set up a trust and ensure that as much of your estate gets passed on as possible without estate taxes or probate
  • Do you want to donate your money to charitable organizations? Or do you have some other development or project in mind?

You have to set your long-term goals early because it impacts the financial instruments and vehicles you should use. Fortunately, when you work with knowledgeable financial advisors and wealth managers, they can help you determine and outline your goals if you need a bit of assistance.

Financial Planning is Different for High-Net-Worth Professionals

Speaking of wealth managers, remember that high-net-worth financial planning is different compared to financial planning with much less money in your name.

Simply put, you can now afford premium advisory and management services. You already have plenty of money, so you shouldn't go for the budget-friendly accountant service down the street. You get what you pay for, so you should "splurge" on premium wealth management professionals.

The same is true for asset protection. With something as important as your entire estate at stake, the last thing you want to do is save a few bucks here or there with subpar protection. 

It’s a much wiser choice to follow other high-net-worth professionals and engage with premium, high-value financial advisory services.

Those services and firms will be able to set up and manage asset protection trusts and other vehicles to ensure your estate is secure and safe for a very long time to come. 

Think of it this way – you can now access high-net-worth financial planning resources and ensure that you stay a high-net-worth individual. Why wouldn't you take advantage of that opportunity?

You Need a Partner You Can Count On

There's one more thing you should consider as you start to dip your toes into high-net-worth financial planning: the kind of partner you choose will heavily impact your results and your long-term wealth management relationships.

It’s a good idea to vet your partner capably and ask the right questions of any financial advisor you may work with. The ideal wealth management and asset protection partner will:

  • Have extensive experience in this arena and exclusively work with high net worth clients. That way, you know that they have the tools and expertise needed to provide you with the service you deserve
  • Have a minimum net worth requirement – again, this will tell you that they only work with individuals of your financial means
  • Be committed to you and willing to work with you for decades to come. High net worth financial management is an ongoing process, and you’ll want to work with a firm that will stick with you through thick and thin in the future

Contact Dominion Today

If all this sounds overwhelming or difficult to tackle alone, good news: you don’t have to. Instead, you can rely on the experts at Dominion – our knowledgeable, supportive financial officers and legal advisors will do everything they can to ensure your wealth is kept safe and works for you for generations to come.

Want to protect your wealth from lawsuits? We can help. Need to ensure that your estate stays solvent and valuable for your beneficiaries? We can do that, as well. In fact, there's nothing we can't do for our partners, so contact one of our representatives today.

Dominion

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