Four Ways High Earners Can Unlock the Full Potential of Their Wealth
Money doesn’t come with a manual, but wouldn’t it be great if it did? The reality of being a high earner is that the more money you accumulate, the more complex it becomes to manage. With greater levels of wealth comes more opportunities to pursue, and missing out on them could mean bigger consequences down the line.
That’s why the concept of wealth planning is so critical for high earners. Wealth planning integrates all aspects of your wealth to design a unified and comprehensive strategy that aligns the pieces of your financial life towards your greater life goals.
Beyond feeling financially confident, wealth planning can help you go above and beyond to unlock your wealth’s fullest potential. Below, we’re exploring four ways we’ve helped clients do just that.
Way #1: Retire on Their Terms
Wealth planning goes beyond basic retirement planning. By redefining the whole idea of retirement, wealth planning can help ensure you not just survive retirement, but thrive in it.
We’ve helped our clients create their own rules for retirement by aligning their full financial picture with their vision for the future.
For example, there’s no rule that says you must retire at age 65. Maybe you’d rather create a portfolio that supports an early retirement. Or you’d like to leave the corporate world behind and start a new business venture all on your own—and have the financial stability to support your decisions to do so.
Wealth planning can help you unlock your retirement’s fullest potential, so you can enjoy retirement on your terms, whether you prefer something more active and adventurous or calm and peaceful.
Way #2: Leave a Legacy of Giving
If you’ve experienced good fortune from a financial perspective, you may feel moved to give back and share your resources with others. Through wealth planning, we can help you incorporate your values and charitable desires into your greater financial picture—both during your lifetime and after.
The great thing about charitable giving strategies for high earners is that we can help find opportunities to both benefit your charity of choice and relieve some of your tax burden. Many charitable giving tools, like donor-advised funds and charitable trusts, allow you to deduct the contributions from your taxable income (keep in mind, you typically will have to itemize your return to take charitable deductions).
From donating appreciated assets (like stocks and bonds) to establishing a full-fledged foundation, you have the power to define your legacy by incorporating charitable giving strategies into your wealth plan.
Way #3: Support Future Generations
If you envision your wealth lasting far beyond your lifetime, it might make sense to focus on incorporating multi-generational and long-term wealth preservation strategies into your greater wealth planning. When you take the time now to prepare for future generations, you can use your wealth to build financial stability for generations to come.
For example, you may want to establish trusts for your grandkids to access in the future—perhaps when they graduate college, get married, turn 30, or whatever stipulations you’d like to include. Similarly, you could establish or contribute to a 529 plan to cover higher education costs for your loved ones.
We’ve also helped clients develop and execute gifting strategies, which when executed thoughtfully, can provide several benefits for multi-generational families. If you own a sizable estate (or expect to later in life) gifting can reduce the amount of your estate subject to federal or state estate taxes while enabling you to experience the impact of your gifts while you’re still around.
Way #4: Explore Tax-Minimization Strategies
Taxes have the potential to diminish your earning capacity, so finding ways to minimize your annual and lifelong tax obligations through wealth planning is critical.
Together, we can find opportunities to help accomplish your goals and maximize your wealth’s full potential by minimizing what goes to Uncle Sam. From strategies as simple as maxing out retirement savings contributions to utilizing tax-loss harvesting within your portfolio, we can identify tax-saving opportunities all year long.
Wealth Planning Unleashed
Wealth planning allows us to bring all elements of your financial life together under one roof and coordinate them completely. We believe that when you achieve full alignment within your financial life, you’re in a better position to pursue your greater goals like retiring early, establishing a legacy of gifting, supporting future generations, and more.
Interested in finding out what we can do for you? Reach out to our team today to get started.
Wells Fargo Advisors is not a legal or tax advisor.
Wells Fargo Advisors did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors or its affiliates. The material has been prepared or is distributed solely for informational purposes and is not a solicitation or an offer to buy a security or instrument or to participate in any trading strategy. Additional information is available upon request.