Accumulating wealth involves a lot of careful consideration, sacrifice and due diligence. Of course, acquiring wealth can be the result of countless inputs and circumstances. However, maintaining wealth is a different game altogether. In fact, there are plenty of individuals who have previously attained a great deal of wealth but through poor planning and decision making have seen such wealth evaporate across time. Achieving wealth is great, but the real prize is in maintaining it.
Ontario investor Yelian Garcia knows that keeping your wealth and making it grown can be difficult and challenging if you don’t have a background in finance or are not willing to seek help in this area. Here are three key protective measures you can take to protect the wealth you have accumulated, according to Yelian Garcia.
If you own a business, you probably know what liability insurance is, but you may not be familiar with its importance. This form of insurance is essentially a lifeline between you and the success of your business, should someone seek legal action against you. Liability insurance is a part of the overall risk management strategy. There are plenty of variations on the liability insurance theme and these include: product liability, cyber liability, professional liability and more. Yelian Garcia advocates for “financing the risk if possible” which means insuring yourself. He advocates for a step-wise risk management strategy 1) identify the risk; in this case risk of wealth destruction 2) evaluate the risk 3) primary prevention 4) finance the risk through insurance is feasible or available 5) revisit and assess the plan yearly.
Keep arms distance from renters:
If you have accumulated wealth through real estate and are a landlord, you should consider separating your personal and business assets from one another. This way, if a tenant brings about legal action then personal assets may be excepted from legalities. The separation may be achieved through incorporating, creating a trust and other options. Yelian Garcia recommends these protective measures, saying that they are simple, but effective.
Review joint accounts:
Joint accounts are common among spouses, significant others and family members. However, joint accounts can also incur a lot of financial risks should relationships in your life take a turn for the worse. Yelian Garcia says this is why it is important to review joint accounts and assess them on an infrequent but consistent basis. Do you perhaps have too much money placed in it? Should some funds be removed from the account, and where should they be placed? These are all vital inquiries that can be the difference between keeping what you have or risk losing it.