Broker Check

4 Important Financial Protection Strategies

May 31, 2023

Warren Buffett once said, "Rule no. 1: never lose money. Rule no. 2: never forget rule no. 1." As financial professionals, we spend much of our time discussing how to manage your money. However, another critical aspect of our financial strategy is following Warren Buffett’s rules and protecting the wealth you have already amassed.

The more complicated your financial life, the more sophisticated the strategies can be used to manage your finances. We may have already discussed some or all of these, but as your financial goals and circumstances evolve, it can be helpful to reassess your strategies.

  1. Positioning Assets: Would it be appropriate for you to hold certain investments or assets in legal entities, such as a limited liability company (LLC)? Remember that LLC laws vary by state, so it’s critical to understand the rules that affect you.

  2. Personal Insurance: If your net worth exceeds the limits of your homeowners or auto liability insurance policy, you might want to consider buying additional personal liability protection. If you were to lose a lawsuit for a sum greater than what your existing insurance would pay, you might put other assets at risk.

  3. Estate Strategies: When was the last time you updated your estate documents? If it’s been more than a few years, it may be time to take a fresh look. Do your documents reflect any new children or grandchildren? Any marriages or divorces? Updated documents may be one of the best gifts you can give to your beneficiaries.

  4. Philanthropic Activities: Do you want to “step up” your philanthropic activities? Do you want to do more than write a check to your favorite charities? It may be time to consider expanding your giving approach.

Let us know if you’d like to discuss these items in more detail. We can help coordinate meetings with your legal, tax, or insurance professionals to help ensure your overall strategy is tailored to your specific goals.