2025 Wealth Preservation Strategies

As a high-net-worth individual, you already know how much work goes into building wealth. Yes, you have worked hard to build your wealth, but here is the truth – growing it is only half the job. The other half? Making sure it lasts, not just your lifetime but also after you.

While you are busy earning, investing, and scaling your income, it is easy to overlook the importance of protecting what you have already built. And no, wealth preservation does not have to feel like another complicated layer to your financial life. With the right high-net-worth investing strategies, you can keep your wealth intact without turning your life upside down.

Because what good is a strong portfolio if it cannot stand the test of time and come to your rescue even as the years go by?

But first, why do you need to focus on preserving your wealth?

As a high-net-worth individual, you may have a comforting bank statement, but you are also dealing with bigger risks. It is easy to get caught up in growing your wealth, chasing high-net-worth investment opportunities, or expanding your financial portfolio, but wealth preservation deserves just as much of your attention.

High-net-worth individuals are typically categorized as those with over $1 million in liquid assets. According to the U.S. Securities and Exchange Commission (SEC), the thresholds may vary slightly — say a net worth of $1.5 million or $750,000 in investable assets to meet certain regulatory definitions. But no matter where you fall, the responsibility that comes with wealth remains the same.

Moreover, the more wealth you have, the more you have to lose. You are more visible. Wealth attracts attention, and it may not always be the good kind. You might be a target for lawsuits and drawn into legal disputes. You may take on larger risks, such as in business, real estate, or private investments, simply because you can. And if your wealth is inherited rather than self-made, it can sometimes feel like it is endless, even though it isn’t. Without the experience of building it from scratch, it can sometimes be easier to underestimate how fast it can slip away. One impulsive decision or economic downturn can turn the tables over.

This is why you need to have high-net-worth investment management techniques up your sleeve that focus on preserving your wealth. Thankfully, you do not need to do this on your own. Hiring a wealth manager can be helpful in getting personalized guidance suited to your situation. Nevertheless, the following strategies can also help.

1. Use the right high-net-worth financial planning strategies to protect your assets from lawsuits, domestic disputes, theft, cybercrime, and more

Lawsuits, cybercrime, and theft are real risks. While they may seem hypothetical, preparing for them is essential. Did you know that excessive litigation costs the U.S. economy around $367.8 billion every year and leads to the loss of nearly 4.8 million jobs, according to the American Tort Reform Foundation? And this is just the visible damage. Behind the scenes, cyber threats are also rising fast, especially for individuals with a high public profile. For wealthy families and individuals, a lawsuit can emerge from business dealings, real estate disputes, domestic situations like divorce or separation, or even household employee issues. A 2024 Deloitte report found that 43% of family offices had experienced a cyberattack in the past two years. Why are the wealthy such prime targets? Probably because factors like public visibility, complex financial arrangements, and numerous digital entry points make it easier for cybercriminals to exploit gaps.

Here are some areas that you should focus on when it comes to wealth preservation:

• Personal property protection: Items like jewelry, art collections, etc., are some high-value assets that can be vulnerable to theft and damage. It is important to invest in high-value item insurance to protect them. You can look for insurance companies that offer comprehensive insurance for luxury items to ensure your possessions are financially protected. In addition to this, make sure these items are stored in secure safes and lockers to avoid theft.
• Real estate risk management: Your primary residence, commercial properties, etc., are exposed to legal claims, natural disasters, and price fluctuations. Comprehensive property insurance is a must to protect your holdings from natural disasters and legal claims. Additionally, you also need to consider domestic disputes and estate planning issues related to property. In this case, a clearly written will or trust can help prevent complications in property ownership or transfers.
• Business asset protection: Your business may be prone to risks like business-related legal issues or market fluctuations. You can protect your interests by operating through limited liability entities such as LLCs or corporations. These structures separate your personal assets from the business. Additionally, you must maintain appropriate business insurance and consult with wealth managers and legal experts to ensure ongoing protection. You can also protect your business from market fluctuations by diversifying across multiple industries.
• Litigation and liability protection: Lawsuits can come from many directions, including a car accident, an employee being injured on your property, or due to personal issues with a former spouse. You need a strong liability insurance policy. Many wealth managers recommend buying an umbrella coverage of at least $10 million. However, you can discuss the appropriate coverage for your assets with a wealth manager. You might also consider jointly owning certain assets. It can be harder and a lot pricier for creditors to acquire jointly held property.
• Privacy protection through offshore accounts: Many high-net-worth individuals maintain offshore accounts in other countries. These accounts typically offer stronger privacy protections as well as favorable tax regimes that can enhance your wealth preservation strategy. However, it is important to use them ethically.

2. Diversify your portfolio beyond stocks and bonds and think of global, tangible, and private equity opportunities

Sure, you have heard it a hundred times: “Don’t put all your eggs in one basket.” But for someone with substantial wealth, diversification means much more than just splitting your investments between stocks and bonds. As a high-net-worth individual, your investment strategy needs to go beyond basic sector allocation or dabbling in large-, mid-, or small-cap stocks. It requires a more tactical high-net-worth investing strategy for asset diversification. This is where you can really benefit from the expertise of a wealth manager. You can also explore the following ideas:

• Spread your risk across borders with global investments: Sticking to familiar territory can be comforting, but expanding horizons can be more beneficial. Investing only in the U.S. exposes you to localized risks that can come from changing political regimes, new tax laws, economic downturns, inflationary periods, and more. Diversifying across geographies can help reduce exposure and contribute to preserving wealth.
  Investing globally gives you access to a different market that is not exposed to the same risks as domestic investments. It also offers multi-currency exposure. There are multiple ways to diversify globally, such as through international mutual funds or direct equity.
• Consider tangible investments like real estate: Real estate is a wealth preservation tool that can provide both capital appreciation and consistent rental income. It is less volatile than equities and can be a stable asset during inflationary periods.
• Buy gold, whether as jewelry, bars, or virtually: Gold is another tangible asset worth considering. Whether you buy it in the form of jewelry or as bars and coins, it has the potential to provide a hedge against inflation. You can also consider gold mutual funds, exchange-traded funds, and futures and options.
• Invest in emerging companies through private equity: Private equity can be a powerful high-net-worth investment strategy. Startups and private companies may offer significant growth. But let’s be clear, private equity comes with high risk, as well. So, instead of simply investing your money in the next shiny idea, as someone focused on wealth preservation, your goal should be to back businesses with potential. So, take calculated risks, research well, and consult experts as and when needed.

3. Get into the depths of tax planning and explore multiple tax savings strategies

Tax planning is extremely important for high-net-worth individuals to ensure more of your income and profits are retained. There are a lot of ways to do this. For instance, you can invest in real estate. Apart from all the benefits of investing in real estate, as highlighted above, the asset class also offers tax deductions over a wide range of expenses. You can use expenses, such as property taxes, mortgage interest, maintenance costs, insurance premiums, and depreciation, to lower your taxes. If the property is used for business, you can even deduct office space and related operational expenses. These deductions significantly lower your taxable income and contribute to wealth preservation. You can also use the 1031 exchange. A 1031 exchange allows you to defer capital gains tax when you sell a property as long as you use the money to reinvest into another property. Having said that, a 1031 exchange can be complex. So, consult with a qualified tax professional before executing it.

Next, consider fully funding your retirement accounts by maxing out contributions to tax-advantaged plans like 401(k)s, Individual Retirement Accounts (IRAs), and Health Savings Accounts (HSAs). All of these reduce your current taxable income while also allowing investments to grow tax-free or tax-deferred. Moreover, your money grows through the power of compound growth. For families with children or grandchildren, contributing to a 529 education savings plan can also be a smart move. These plans grow tax-free, and withdrawals are tax-exempt when used for qualified education expenses.

Apart from investing in the right assets, you can also save tax by adopting the following strategies:

• Use tax loss harvesting and turn your losses into a tax-saving opportunity so you can preserve your wealth. Tax-loss harvesting involves selling underperforming securities at a loss to offset taxable capital gains. This strategy helps minimize your overall tax liability and can be repeated annually for consistent tax savings.
• Consider certain types of trusts like Irrevocable Life Insurance Trusts (ILITs), Grantor-Retained Annuity Trusts (GRATs), and dynasty trusts for reducing estate tax exposure and protecting assets from creditors or probate disputes.
• Use Separately Managed Accounts (SMAs). Unlike mutual funds, SMAs are customized portfolios managed directly for you. One of their key advantages is tax efficiency. SMAs offer key tax advantages, particularly through tax loss harvesting. Moreover, unlike mutual funds, SMAs have no embedded capital gains, so you are not taxed on the gains made in the fund before you join the account, as happens in the case of mutual funds. These are usually offered to investors with at least six-figure portfolios. So, if you fall in this category, you can use SMAs for tax benefits.

What else can you do as a high-net-worth individual to preserve wealth?

• Embrace a long-term investment horizon: This is something you get to hear everywhere – for a reason! Real wealth preservation can be achieved by keeping a long-term perspective. Aim to hold on to your investments for as long as you can to ride out market volatility. This can reduce the risks associated with frequent buying and selling and help you benefit from the power of compounding. It also helps lower transaction costs and lowers your tax bill, as long-term capital gains tax rates are usually more favorable than short-term capital gains tax rates. Moreover, you avoid emotional decision-making. Short-term investing is often plagued with emotional judgments that may or may not always turn out to be in your favor.
• Regularly review your portfolio and alter your high-net-worth investing strategy as and when needed: Preserving wealth is a lifetime, nonstop process. It is important to keep checking your portfolio periodically to ensure it aligns with your needs and evolving market conditions. The idea is not to buy and sell frequently, as that goes against the concept of long-term investing. Instead, ensure that your portfolio is aligned to your needs and tweaked whenever it requires changes. So, play the long game and make course corrections, not U-turns.
• Build a team of professionals who can help you whenever you need assistance: You are only as strong as your weakest link, so make sure you do not have one in your team. Wealth preservation requires a comprehensive approach. You would require tax planning, investment management, legal assistance, and more. Having dedicated professionals on your side can be helpful to ensure that you get structured and tailored advice for your needs. You can hire a wealth manager to oversee your portfolio and manage your investments. Wealth managers can help you with long-term growth and risk management. Additionally, you can work with a tax planner to understand what tax deductions and credits you qualify for. They can also help you execute strategies like tax loss harvesting or the 1031 exchange. You may also need an estate planner to set up trusts, write a will, and more to ensure your legacy is protected and passed on exactly as you intend.

The final step is to apply these wealth preservation strategies. Implementing these high-net-worth strategies in 2025 can protect your money as well as peace of mind. However, not all these strategies may be relevant to you. So, view them objectively and see how they can be customized to suit your needs. Additionally, take time to understand the implications of each approach, and do not hesitate to take a professional’s help, if needed. Consider our free advisor match tool that can match you with 2 to 3 seasoned wealth managers if you decide to seek the assistance of a professional.