For high-wealth individuals, a number of levers can be pulled to manage the ongoing generation and protection of wealth. These include cash flow management, tax planning, estate planning and putting in place important agreements such as a will.
Understanding cash flow is the key to successful wealth management and involves forecasting anticipated income and expenses. High-wealth individuals can avoid unexpected holes in cash flow by using accurate data to make better-informed spending decisions that align with their financial goals.
Tax planning involves positioning personal affairs toward long-term tax efficiencies. Tax minimisation strategies for high-income earners can include maximising available deductions and minimising capital gains tax , amongst others. Minimising tax enables the growth of individual wealth and can maximise the transfer of intergenerational wealth.
Estate planning is the process of strategically managing the transfer and protection of wealth and assets. It provides a clear and legally sound plan to preserve wealth and inheritances for the next generation in a financially efficient and tax-effective way. When carefully managed, high-wealth individuals can ensure that their estate is distributed to the intended trustees or beneficiaries at the right time, and without unexpected tax consequences.
Planning ahead and putting in place structures such as a valid will can help to avoid the risk that undocumented intentions may not be fully acted on in the event of death or incapacitation. Without a will, there may be an imbalance in the distribution of an estate due to higher rates of tax payable by some beneficiaries. A willmaker and their advisors can assess opportunities to manage the tax implications for beneficiaries. Testamentary trusts and binding superannuation nominations are other important aspects of estate planning to consider.
Strategies for wealth generation can be complicated and daunting without the help of a financial expert. At Abbotts, we are familiar with financial, tax and estate planning and always act in the best interests of our clients. Get in touch to learn how we can help protect and grow your wealth portfolio for you and your loved ones.