Ultra-High Net-Worth investors are focused on growing and preserving their wealth, and creating a legacy for future generations – sometimes to the detriment of planning for their own retirements. Though it might seem like these extraordinarily wealthy individuals would have little to worry about when it comes to retirement, there are some common pitfalls that can cause stress and anxiety during the years they should be enjoying to their fullest. Here are some of the top tips to keep in mind when considering how to sustain your Ultra-High Net-Worth lifestyle in retirement – and how your ultra-high net-worth wealth manager can help.
1. It Starts With A Sound Strategy
A strong financial strategy throughout our lives is the foundation for sustaining your lifestyle in retirement, particularly for Ultra-High Net-Worth clients. Our lifetime of strategic saving and spending makes a far bigger difference in the wealth we accumulate for retirement than swings in the market during the years we’re retired. It’s never too soon to develop a reasoned, long term strategy for retirement so that, when you get there, you can live the lifestyle that you have dreamed of (and become accustomed to).
Creating a comprehensive financial strategy that is designed for your unique situation and goals is crucial to a healthy retirement, where you can enjoy the wealth you have worked so hard for. Here’s an example: the market’s recent volatility has been hard for investors to stomach, but we’ve built resilience into our clients’ portfolios and recognized that a core of precious metals, with gold as your biggest asset, would reward them in the long run. If you have patience and confidence in the financial strategy laid out by your UHNW wealth manager, you’ll feel more confident in your ability to sustain your lifestyle now and during retirement.
2. Leave Emotions Out Of It
Just as we caution investors not to give in to emotional motives or allow others’ actions to influence their investment decisions throughout their lives and careers, that same caution extends to maintaining your lifestyle in retirement. We understand that investors can feel anxiety and stress about how the market will perform in their retirement, and how that will impact their ability to sustain their wealth through these years, caring for spouses, children, and grandchildren, and, ultimately, leaving their legacy. We understand it, but we also know that the nature of the market is to be in flux, and that the best course of action is to take a reasoned, long term approach to investing, with an eye on industries we know well, and resisting trends.
Ultra-High Net-Worth investors may be tempted to listen to friends and colleagues who share their own financial tips or strategies, but it’s important to adhere to your own values and plan, as you can never really know what another person’s financial picture, history or goals look like.
We often say, there is no blanket advice that will be optimal for every investor. What you do next depends very much on what you have done in the past: when and how you’ve bought, how much you bought it for, and how much of a percentage of your total net worth it makes up. These questions, and many others, are important to consider when deciding to buy or sell – and ones that emotional investors are unlikely to ask.
3. Expect The Unexpected
The bad news: as much as we want to believe that we can outline a financial strategy that accounts for every possibility and permutation, it’s not possible. The good news: your Ultra-High Net-Worth wealth management firm should already know and expect there to be a variety of changes and updates to your financial needs throughout your retirement in order to sustain your lifestyle. The ability to be flexible and agile to cover unexpected circumstances in retirement is part of a sound, comprehensive financial strategy. As Chris has said in the Weber Global Opportunity Report: “On Taking the Longer View: You commonly hear people talking about big dramatic swings in the market and sharing tips on hot stocks. In reality, if you take the long view, everything tends to even out. Sure, a very few famous companies will stand out, but the 30 stocks of the Dow Industrials, the 500 of the S&P, and the 2,000 of the Russell have barely moved since the summer of 2018. Looking at things over the past year or two, you see that it all has been “a lot of sound and fury, signifying nothing.”
The fact that unexpected changes are out there means it is also important not to create unnecessary turbulence for yourself through erratic spending and making sudden or considerable changes. Your financial strategy is projected into the future based on an understanding of how you prefer to live, save and spend. The more you keep these factors constant, the more accurately you can project into the future and control the things that are within your control. Be wary of following the crowd, and don’t be afraid to buck trends – it’s those on the fringe who are the most astute observers of the start or end of any trend.
Your Best Asset Is You Ultra-High Net-Worth Wealth Manager
At Weber Global Management, we have a deep understanding of Ultra-High Net-Worth clients and what keeps them up at night worrying about the future. Focusing on the future is important, but the critical steps to a financially secure retirement start with a comprehensive, individualized financial plan today. Our long term, reasoned approach takes into consideration the unique psychology and risk tolerance of our clients that is a crucial piece of a comprehensive investment strategy. If you’re ready to create a financial plan that is designed to grow and preserve your wealth to sustain your lifestyle through retirement, reach out to us here.
