Protecting Your Wealth

6/5/2019 Go to Comments

You Can�t Hide Money Unless You Know This �Secret�

By Erika Nolan, Executive Publisher - Sovereign Investor

Johnny Carson once joked, �The difference between a divorce and a legal separation
is that the legal separation gives a husband time to hide his money.�

In the lounge at the Hamilton Princess hotel in Bermuda, about seven years ago, I
was offered a choice. I was setting up an investment account.

The advisor leaned in and whispered, �Now, you don�t have to put your husband�s
name on this account. It�s up to you. But if things go bad between you, and his
name is on this account�.well, it will be too late.�
...
I did the fair thing � I added Patrick�s name to the account. After all, the money
was �our� money� earned by both of us. Now, after nearly 14 years of marriage,
things are still rosy (knock on wood) and the majority of our wealth has been built
together.

Putting money out of reach � from a spouse, children, business partners, or even
employees � is a rather unsettling, but very popular topic. Just last week, the WSJ
ran a full page story telling of how hiding money from your spouse has gotten
harder� but the truth is there is a simple way to protect your wealth.

Discretion � Less is Really More

Money is easier to disguise when it never surfaces. This may not seem like a
secret, but it is. Using a bit of discretion and living beneath your means may seem
counter to the �American Way� but it�s smart.

Bragging and flashing cash is a big risk these days. The less you flaunt your
wealth � and your personal details � the less likely people are to reach into your
pockets. Often, you are your own worst enemy. A few of the wealthiest people I know
look like average, every-day people.

My one good friend is worth tens of millions of dollars, easily. And for the
duration of our decade-long friendship, I�ve rarely seen him dressed in much more
than a pair of khakis, a button-down shirt and a muted cashmere sweater tossed
around his shoulders.

Another friend of similar means chose to pay cash for his cars � buying mid-level
Japanese models because he finds them reliable. He lives in a very nice, but modest
house for his wealth. Outside of those closest to him, no one has a clue about his
net worth.

A long-time Sovereign Society member, I�ll call him Paul to maintain his privacy,
has been attending our offshore events for years. I met him in early 1999 and
frankly, he was dressed like a building maintenance man.

I still remember his bright yellow t-shirt and his tan Dickies. Years later, he
still wears nearly the same outfit to our events, but I now know he owns multiple
apartment buildings in New York City.

The other mistake many people make, other than flashing the cash, is volunteering
private information. Telling people about your wealth is one of the fastest ways to
get on the radar.
I fly roughly 75,000+ miles a year and I�m always amazed at the stories complete
strangers tell me during the course of the flight. Small talk is fine�but revealing
your net worth, bragging about your latest real estate development, divulging your
portfolio assets, and the like makes no sense.
?Say Good-Bye to Technology

Besides keeping your lips sealed, use discretion with today�s technologies. As the
WSJ rightfully points out, smart phones, text messages, Facebook and computer
transactions all leave a trail that can easily be picked up by a spouse.

And, these trails are very hard � if not impossible � to wipe out. But, the WSJ
falls a bit short with their advice.

I am a huge advocate of not using electronic communication for anything truly

confidential. This is especially true when it comes to offshore accounts, trusts,
etc.

If you want to ensure real privacy over your financial information, you have to go
back to basics.

Elect to have any detailed financial statements from banks or brokerage firms held
for you. Then instruct the companies to forward the documents to a lawyer.

Normally, asset-protection or family attorneys offer this service, and this is

especially true if you are a client. Opt to go to the lawyer�s office to open and
review the mail, make any necessary phone calls or sign any necessary papers.

Leave any documents you need to retain in the custody of the lawyer to ensure
maximum privacy where it is shielded by the rules of lawyer-client privilege. Shred
anything that isn�t worth saving.

My advice is to use discretion when it comes to your wealth, and that applies to
everyone�except governments and tax authorities. There you must be fully
transparent and fully compliant. Tax returns are not part of public record so they
can�t be accessed without a lawyer and a judge.

Unfortunately, many people make their most private financial details �public� all
by themselves. Keep your secrets to yourself. It will save you thousands.