You Worked Hard To Build Wealth — Use This 3-Step Checklist To Protect It
Written by
Laura Bogart
Edited by
Kristen Mae
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To say you’ve worked hard would be an understatement. You’re no stranger to pulling a 5 to 9 after your 9 to 5 ends. You’ve met with financial advisors and investment professionals to figure out how to stretch your money and grow it through passive income. What you’ve accomplished at this point in your life is impressive — and now, you’re starting to think about what the next phase might look like.
That next chapter should start with protecting what you’ve built. Just as you mapped a master plan to build your wealth, you’ll need a strategy to safeguard it. While personalized advice from your financial advisor is always smart, these three essential steps can help you prepare now.
Create an Estate Plan
An estate plan is a cornerstone of protecting your financial legacy — helping ensure the hard work you’ve put in today will continue to bear fruit long after you’re gone. One of the most powerful ways to protect your assets is to keep them in the family and make sure your loved ones can access them easily and responsibly.
Start by working with a trusted financial and legal team to create a will or a revocable living trust. A revocable trust allows you to manage your assets while you’re still around and to lay out clear instructions for how those assets should be distributed after your death. It can be changed or revoked at any time, as long as you’re making competent, voluntary decisions. It also spares your heirs the time and expense of probate.
To reduce the emotional and financial burden on your family in a crisis, you should also set up an advance healthcare directive and designate durable powers of attorney for both medical and financial matters. These documents ensure your wishes are honored and take difficult decisions off your family’s shoulders.
Make Sure You Have the Right Life Insurance
At a minimum, life insurance is designed to protect your family’s financial future if something happens to you unexpectedly. A policy can help them pay off debts, cover day-to-day living expenses and continue pursuing long-term goals like college or retirement savings.
You may also want to consider permanent life insurance, like whole or universal life, which offers lifetime coverage and a cash value component that grows tax-deferred. An added benefit is that you can borrow against the cash value to help cover major expenses, like a down payment, tuition or even retirement needs.
The right insurance policy can serve as a flexible tool in your long-term financial strategy. For example, a home you purchase using life insurance funds could later appreciate in value, building even more wealth for your future.
Diversify Your Portfolio
Yes, diversification is well-worn advice — but it’s popular because it works. Spreading your investments across a range of industries, asset classes and geographic regions reduces risk and creates stability.
Think of it this way: If all your investments are in big tech, and that sector hits a rough patch, your whole portfolio will suffer. But if you’ve also invested in sectors like healthcare, energy or consumer goods, those holdings might hold steady, or even grow, while others struggle.
You can also diversify beyond stocks. If real estate interests you, consider investing in some properties to rent out for passive income. If the work of managing a property seems like too much to keep up with, you can still participate in the market by investing in a real estate investment trust (REIT).
A REIT pools investor money and puts it into income-producing real estate that it owns, operates or finances. With a REIT, you can get some exposure to the real estate market without the maintenance and management that come with owning property.
Bottom Line
Growing and protecting wealth takes intention. But it doesn’t have to be complicated. By taking simple steps, like setting up an estate plan, securing the right life insurance, and diversifying your investments, you can help ensure the future you’ve worked so hard for stays on track.
Looking to build a legacy? Check out our Life to Legacy guide for expert advice and smart moves you can make today.
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