Securing YOUR Ultra-High Net Worth Portfolio And Estate

It is always wise to evaluate portfolios and strategies on an ongoing basis. However, in times of change, the need is even greater.

And with the Federal Reserve’s change in policy and the incoming 2017 Trump Administration, it is safe to say that ultra-high net worth families must be prepared for possible good times, and also potential volatility.

For investors who apply big picture thinking and create an analyzed set of action steps, these changes are an opportunity to install protection mechanisms; it will also be an opportunity, and one that may not present itself as attractively for years, or perhaps decades to come.

2017 Trump Administration Policy Changes

Most savers choose a target-date fund and leave it at that when it comes to a 401(k) account.  However, with a rule change from Trump’s administration, this is likely to expose savers to new risks.  401(k) plan managers can now invest in private equity, which means your 401(k) could have a stake in private companies. 

Although the goal of this change is to allow investors to have access to alternative investment and make sure that regular people investing for retirement have an opportunity they need to secure retirement, there are some downsides to this move. 

The significant risks associated with private equity investments are not fully addressed. These investments are complex, challenging to value, less liquid, and may come at a higher cost that the investments available through the traditional retirement plans. 

The risk increases as private companies are not required to disclose the same data as public companies. Another concern is whether the plans would put private -equity funds among the options that savers should choose from or whether they’ll mix them into existing funds. 

The Treasury Department in 2017 also ended myRA program that was meant to help those who didn’t have access to a 401(k) or any other retirement plan. While this plan had its limitations, it helped a few people plan and prepare ahead. 

There is also a proposal to change the rules governing 401(k)s. The idea is to tax money employees contribute to the 401(k)plans upfront. 

How We Can Help Secure Your Ultra-High Networth Portfolio

To assist investors with mapping a smart, safe and strategic path forward, we feature a series of targeted questions in our book “The Art Of Protecting Ultra-High Net Worth Portfolios And Estates, Strategies For Families Worth $25 Million to $500 Million”. We present part one of these questions below and will list the remainder in a follow-up article.

We recommend that ultra-high net worth investors actually write down and document the answers. This helps with clarity, completeness, and serves as a reference that can be valuable for the whole family in the future. We also recommend that investors keep their appointment calendar open, so they can give themselves deadlines and tentatively schedule appointments with family members and advisors.

• What does money mean to you? What do you want it to accomplish in your life? How does this intersect with your hopes, dreams, and plans for your family?

• Do you already have a family constitution? If so, is it time for your family to review it, making revisions as needed, and making sure your family truly understands the values outlined in the constitution?
  If you don’t have a constitution, when can you schedule a family meeting to begin the discussion? Who can you put in charge of making sure the discussions are fruitful and lead to the end product — a useful family constitution — within a reasonable amount of time?

• Are you happy with your advisors? (we discuss this in-depth in chapter 4 of our book). Are there any areas where your advisors are falling short? Are there some direct, proactive conversations you need to have with an advisor to make your expectations clear? Would you be better off replacing any of your advisors?
  If you have a Family Office, is it functioning the way you had hoped? Are there any areas that need improvement? If you don’t have a Family Office, is it time you considered setting one up? Or can your family’s needs be met in other ways (such as a cohesive, independent team)?

• Do you have a clearly stated investment strategy? If not, when can you schedule a meeting with family members and the appropriate advisors to create one?

Remember: Protecting Ultra-High Net Portfolios and Wealth is Not Easy!

We conclude by reminding investors that protecting their family’s wealth is an ongoing obligation. It is not a “set it and forget it” proposition. It is vital to make adjustments; sometimes minor tweaks, and other times major changes.

At the same time, wealth management is not something that is governed by one specific specialization. 

It is a group effort, which means that investors need to leverage the expertise from a variety of diverse disciplines, including personal psychology, family dynamics, legal, accounting, finance, insurance, asset protection, business succession, retirement planning, philanthropy — and of course, wealth management! Talk to a financial advisor in Michigan today for more on wealth management. 

About Pillar Wealth Management, LLC

Haitham “Hutch” Ashoo and Christopher Snyder are privileged to have worked with ultra-high net worth families, some of whom attained wealth reaching $400 million, helping them achieve a positive change in their lives and finances.

They co-founded Pillar Wealth Management, LLC, an independent, fee based, private wealth management firm. As their clients’ go-to advisors, they are brought in to help with investment management, strategic planning, asset allocation, risk control, and tracking of their clients’ progress towards life-goals.

Their services are provided to a limited number of clients. They only accept a new client when they have determined that there is mutual admiration and respect and only if they can add substantial value to the client’s financial life. Learn more at https://pillarwm.com. You can reach us at [email protected]