Advanced Planning for High-Income Earners/HNW

• Minimizing tax burden/Need for tax-management strategies:
  • Generally subject to higher tax rates or have more complex tax situations due to investments, business ownership, or other sources of income.
  • Have savings amounts that far-exceed annual limits on the most common tax advantaged vehicles.
  • Need to balance tax management across all relevant time periods against keeping properly diversified exposure to asset classes.
• More investable assets: both a blessing and a curse.
  • With increased complexity, many come to us unaware of or struggling with inefficiency and duplication. All holdings should serve a purpose, and many holdings may serve the same purpose in different parts of your portfolio, which requires oversight to avoid overlap, unplanned redundancy, and unintended holistic portfolio allocations across accounts.
  • Many worry intensely about making the right investment decisions, managing risk, and keeping up with market trends, in part due to the inherently larger stakes.
  • Many high earners (especially financial professionals!) don't just want to be in stocks once assets really start to accumulate. We understand and can provide access to alternative diversification options like structured notes, private equity, hedge funds, real assets, and purely uncorrelated assets to suit your specific risk/reward and liquidity profile.
    
  • Equity-based awards and other less common compensation structures call for more creative strategy solutions and advanced planning. Many wind up needing to manage risk surrounding concentrated equity/stock positions from compensation or long-term holding.
  • Access to private opportunities: while more opportunity may seem like an advantage, it can also quickly turn into complexity and disorganization. It can be extremely difficult to assess where non-traditional investments and business interests fit within a holistic financial picture.
• Managing Variable Income & Liquidity:
  • Prior emphasis on accumulation eventually leads to a shift to recognizing the value of intelligently ensuring you can keep and use assets more flexibly over time. This includes access to liquidity, risk management, asset protection, tax strategy, and more.
    
  • Private assets/investments used to diversify and/or non-traditional compensation structure and timing can lead to significant cash flow and liquidity planning complexity.
  • The art and science of intelligently and efficiently getting cash flow onto and off of your balance sheet become critical, especially when variable income and equity compensation come into play.
  • Lifestyle inflation: Many worry about falling into the trap of lifestyle inflation, where spending increases as income rises, making it harder to save for long-term goals like retirement or financial independence.
• Retirement planning/Early-retirement & financial independence potential:
  • Having the potential to become financially independent and retire before age 65 is exciting, but it comes with different risks and challenges than most traditional planning is prepared to deal with.
  • Even small percentage cash flow differences generated by well-designed, flexible distribution strategies can become massive dollar amounts of recurring annual income in retirement at large asset levels. 
  • Earlier retirement ages bring longer than typical retirement periods. When the high-income earning years stop, many worry about whether their savings will be enough to sustain their lifestyle in retirement, especially if they have grown accustomed to a high-cost lifestyle.
  • Health care costs: High earners may worry about their hard-earned assets eroding due to the rising cost of health care and long-term care over time, especially as they age.
• Asset Protection & Estate Planning:
  
  • Protecting wealth from creditors, liability, and transfer friction can become a major concern.
    
• Major Goal and Objective Changes:
  • Shift from feeling need to achieve maximum growth at all costs to protecting and effectively using what's already being earned.
  • Shift from needing to maximize risk and rate of return in order to have a chance at retiring comfortably to achieving more predictable growth and results.
  • Shift from limited opportunities to advanced strategy, which often includes more complexity worth managing. 
    • More pieces to your financial puzzle and more options means more efficiency and optimization considerations to work out, and most high earners are too busy with their area of expertise to justify dedicating the time required to keep up with all of the nuances.  
    • Holistic financial planning accounts for retirement/distribution planning, tax strategies, estate planning, risk management, cash flow & liquidity management, insurance, investments, business ownership, and more. 

High earners often have more complex financial planning needs, and our holistic advisory team has a vast array of tools and resources available to help you navigate these challenges and make informed financial decisions.