Wealth is not an easy thing to accumulate - and it can be even harder to manage. This isn't the fairy-tale we are sold for when we make our first million, nor is it the gilded life we consider ourselves lucky to be born into; it is a burden and a responsibility, to be managed just like any other.
This is why it can be so difficult to control each aspect of one's life as a high earner in a high-wealth family, and why it is so easy to lose track of the financial goals that keep us on the comfortable straight and narrow. It is also why complacency can quickly lead to a bleeding of personal and familial wealth through a variety of outlets - not in the least those of taxation. Here, we will deal with the uneasy tension between success and financial responsibility, with a view to creating a sustainable balancing act for you as an individual supporting a high-wealth family.
Career Income and Long-Term Family Planning
First, it's important to consider the wide view - that of your own financial situation, particularly your present modes of income, and of your hopes for your family. The wide view also means looking at the long term, and what your income can mean for your family as you hit various life stages.
In looking at this broad picture, you can start to consider some of the unexpected ways that money can 'leak' out of your best-laid plans. These are perhaps best exemplified by the 'tapered annual allowance', a tax mechanism that reduces the amount of tax-free pension savings you can put away once earning over a certain threshold.
This is just one of many flies in the ointment when it comes to securing long-term benefits from short-term accumulation of wealth - and just one of the many reasons that personalised investment solutions come highly recommended for high-earning families. Such solutions come with targeted advice, that enables you to make the most of all the wealth-protecting levers available to you.
Balancing Lifestyle Priorities
Such wealth-protecting levers come in particularly handy when presented with more pressing short-term considerations, including those related to costly family goals. These are costs that need to be ring-fenced from your overall savings plan - costs such as private school fees, housing upgrades, full-time childcare, and, where appropriate, care for elders.
'Ring-fence' is the operative term here, as saving for such costs can have negative consequences for your life plans elsewhere - at least, as far as those unexpected leaks are concerned. A case in point would be the recent requirement for VAT on top of private school fees.
Managing finances for a wealthy family, then, is not a simple affair. There are many different tendrils to contend with, all of which can introduce risk to the sanctity of your family's holdings. With the right advice and the right approach, you can secure a future for you and yours.
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