High Net Worth Financial Planning Strategies from Our Professional Advisors

Financial Planning

 Plancorp Team By: Plancorp Team

Financial planning is an important part of achieving your life goals and securing your future. The right approach develops a comprehensive but approachable plan that grows and protects your assets and gives you the independence to pursue passions; but it's not a one-size-fits-all approach. Someone just starting to budget and save in their 20's has different financial planning needs than someone a decade from retirement with a high net worth.

What Is High Net Worth Financial Planning, and Do I Qualify?

If you have a hearing problem, you could visit a general practitioner, but a specialist in audiology would likely best serve you. Similarly, working with an advisor who understands higher net worth will help you develop a plan specific to your needs and goals. You can maximize your investments, protect your assets, reduce your tax liability, and ultimately provide financially for your family and heirs — all with peace of mind.

Generally, financial planning achieves similar goals no matter your net worth, but there are opportunities and risks specific to the financial plans of high-net-worth individuals that often out-pace the abilities of basic personal finance tenets or advice. High net worth financial planning will incorporate a more customized and detailed look at everything from tax loss harvesting to building and maintaining an estate plan that passes on your legacy to the next generation.

Working with a dedicated professional is important at any asset level, but if you have a net worth of $1 million or more, it's crucial to research and find a qualified financial advisor who understands the unique opportunities that come with a higher net worth. Mistakes or missed opportunities are all amplified when there is more on the table, which is why many seek wealth management.

It's important to remember that wealth management is not an exclusive club, it's simply a holistic and proactive approach in comparison to traditional financial advising which tends to focus solely on investments and reactively inform you of updates. Even if your portfolio has surpassed the level of retirement advice typically given — or it's not quite there yet — there's much to learn so you can make the most of your financial success and take your finances to the next level.

With the right financial advisor, you can have peace of mind knowing that your investments and assets are safe and optimally managed.

Financial Planning Strategies for High-Net-Worth Individuals

It's imperative to research for a qualified financial advisor who understands the unique needs and complexities of high-net-worth individuals (HNWIs) and is knowledgeable in areas such as tax law, estate law and documents, investments, and insurance.

HNWIs, and especially ultra-high-net-worth individuals (UHNWIs) often have complex financial planning needs that require sophisticated strategies and careful coordination. Here are four key areas of financial planning that are particularly important to UHNWIs:

Asset Protection

Asset protection is part of wealth management, retirement, and overall financials planning. It refers to strategies that help protect your assets from a variety of "creditors." Asset protection strategies include establishing trusts, forming holding companies, and other techniques.

Certified Financial Planners™ and investment advisors can help you maximize your investments, build diversified portfolios that utilize different asset classes, and develop asset allocations.

These strategies and certifications are great for providing protection, security, and success for UHNWIs, beneficiaries, and their heirs.

Asset allocation strategies typically involve investing in a mix of assets, such as stocks, bonds, and cash. These strategies work best when the assets are chosen based on an investor's goals, investment objectives, and financial circumstances. For example, someone saving for retirement may choose to have a higher allocation toward equities because these are longer-term investments with the potential for higher returns. Someone nearing retirement may choose to shift their allocation to more conservative investments, such as bonds and cash.

Tax Planning

As your net worth increases, you realize that tax strategy goes well beyond the basics of income and property deductions. Once your net worth is spread across a variety of asset types that all have unique tax implications, failing to claim, transfer, or classify something appropriately can leave you paying far more than your fair share. For this reason, tax planning is one of the most common areas a high-net-worth individual will fall short on, leaving a ripple effect in their long-term financial goals. An experienced advisor can help devise a multi-year strategy to minimize your tax liability.

From tax and estate planning to retirement accounts and stock brokerages, working with a professional HNWI wealth advisor who understands investment managements and asset diversification can help you make the most of your money and use tax-efficient strategies to reduce your tax burden and manage your capital gains, real estate, life insurance, and other liquid assets.

Estate Planning and Trust Services

It isn't always pleasant to think about, but considering where your assets will go when you're gone is an important aspect of your holistic financial plan. These wishes are housed in a collection of appropriate documents known as your estate plan.

As is common, everything gets a little more complex when you're looking at multiple properties, assets in a variety of holdings, and evolving estate tax legislation. For this reason, robust estate planning is critical for high-net-worth individuals to ensure their assets are transferred as intended upon death or incapacity. There are many decisions and opportunities to consider: an individual can establish trusts through estate planning, create powers of attorney, and address end-of-life decisions. It's necessary to review these plans regularly because laws change, so be sure to work with both your financial advisor and a legal professional.

Investment Planning

Higher investable assets amplify market changes, making an investment strategy that you're comfortable with all the more important. To ensure your wealth continues to grow, an experienced advisor will work with you to develop a plan that may incorporate investment strategies or tools like dollar-cost-averaging, tax loss harvesting, and portfolio rebalance opportunities. There is a real cost to DIY investing, and working with a financial advisor is one way to avoid missing market opportunities as they arise.

Charitable Giving

Evaluating the tax implications of charitable giving is necessary if you want to maximize the tax savings associated with your personal philanthropic goals. Many HNW individuals want to use their wealth to make a difference in the world. Various charitable giving strategies can be used to optimize the impact of your giving while meeting (or enhancing) your other financial goals, and a financial planner can help you identify them.

In fact, so many Plancorp clients are deeply involved in philanthropic efforts that we have a dedicated service to help manage the assets of institutions and charities. This brings the certified fiduciary experience of our wealth management services to the boards of institutions making a difference, so all donors can feel confident the financial planning is just as strong as the mission.

Insurance Planning

High-net-worth individuals often have significant assets that need to be protected. Put simply, insurance options are plentiful and often complex. Having an experienced financial advisor by your side to make recommendations and make sure nothing is missed is a common benefit of working with someone who specializes in the needs of HNWI clients. 

Finding a High-Net-Worth Financial Advisor 

Finding a trusted financial advisor to assist with your wealth management needs can seem daunting, especially if you're a high-net-worth individual. It's imperative to do your due diligence and ensure that the advisor you choose is experienced and certified to provide advice for your unique financial situation, and search for a financial planner who specializes in high-net-worth investment strategies. Consider this resource on pursuing a better investment experience. By following these steps, you'll be able to find the right advisor to help you create a comprehensive financial plan focused on capital gains, income, and estate taxes that will help you achieve your long-term financial goals while protecting assets for future generations, family members, and beneficiaries.

Last, don't be afraid to ask about service when vetting an advisor. Ask how many meetings to expect each year, where they see the biggest opportunity for your specific plan, and whether they can provide professional references.

Are you getting what you need from your financial advisor? Our financial analysis will help you identify areas to focus on, and you'll receive personalized suggestions based on your responses. So let's get started! 

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Plancorp started with a unique philosophy: Always put your clients’ interests ahead of your own, and you’ll build a successful business. That was in 1983, but the sentiment still drives every decision we make. After 40 years of helping individuals, families and business owners plan for financial independence, our commitment to serving as financial life advocates is stronger than ever. More »