Clients come to us with all different objectives for their accumulated wealth. Some say, “My goal is to leave as much to my kids as possible,” while others state, “I’m ready to downshift, and I would like TwinFocus to more aggressively grow my wealth.”
It is too often the case that people view their wealth in silos. Many wealth managers may focus largely or exclusively on the risks and returns of stocks, bonds, private equity, and other financial investments within a certain portfolio or pool of assets.
This short-sighted approach makes it easy to overlook more effective avenues toward goal achievement. For example, if you’re considering charitable gifting, a more traditional wealth manager may focus solely on your investment portfolio. But a holistic balance sheet approach would look at all your assets, including highly appreciated real estate, art, and other privately held investments – tax-advantaged feeders to philanthropic endeavors that may be overlooked. In certain scenarios, strategies such as testamentary charitable lead trusts, charitable remainder trusts, or spousal limited access trusts could be established to maximize gifting and minimize estate taxes.1
Whatever the situation, we believe that a total balance sheet approach to managing investments is key to understanding how to achieve longer-term goals and staying aware of impediments that may hinder those objectives. This approach takes stock of everything in our client’s portfolios and goes far beyond just allocating across a broad array of asset classes. It examines illiquid assets, both tangible and intangible, as well as investment assets, business holdings, and real estate assets across various family entities, along with each asset’s associated tax drag.
We recognize that the financial moves you make today have a ripple effect that will be felt by the next generation many years into the future. Engaging in estate planning, even in the wealth accumulation phase of your life, ensures that flexible, smart structures can be set up to meet your needs today– and the needs of your heirs tomorrow.
For many high-net-worth individuals, financial decisions can become instinctive. But at a certain point, a complex balance sheet can benefit from an impartial advisor who focuses on the big picture. When people become our clients at TwinFocus, they’re accessing an experienced team that can offer unbiased advice that’s relevant to all the puzzle pieces they may have on their balance sheet.
The bottom line: When you’ve grown your wealth, you deserve to ensure all those resources are working for you in harmony. A balance sheet approach not only allows you to understand what you have—it can also help provide a road map to how your wealth can grow and be channeled to achieve your financial goals.
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