Are Stormy Waters Ahead? Why You Should Begin Securing Your Wealth Today, Not Tomorrow

Many financial forecasters have commented that we may be in the eerie calm before the storm of another economic crisis. While there are good points on either side of the debate, there are plenty of indicators that small businesses should be preparing to weather any economic troubles.

Some of the major indicators of an unhealthy global market are volatile and falling currencies. The Canadian Dollar has lost 25% of its value since 2013. The Australian Dollar has lost 30% of its value during the same time. The Japanese Yen and Euro have also lost significant value in the preceding years. While the US Dollar has remained strong, there is a tenacious push by China, Russia, and other nations to move off the US Dollar standard for international exchanges. The US Dollar may only be the healthiest person in the sick ward, since the last decade has brought unprecedented dollar printing and borrowing.

While currencies are collapsing worldwide, global trade has also slowed. Despite some of the cheapest bulk shipping rates ever, low oil costs, and the strength of the US Dollar to fuel imports to the US, international trade has lagged. Most commentators point to China’s production crisis as the prime reason, but China’s production can only be as strong as the global demand for Chinese goods. As stocks may continue to rise, global trade rates are a real indication of the health of the market. Why aren’t Americans taking advantage of the strength of the dollar to acquire now cheaper foreign goods? Or vacation overseas, experiencing a savings from a few years back? Public confidence rates are low, as falling demand and capital contraction shows.

Whether the global economy will pick up this summer remains to be seen, but when it comes to the business and wealth you have labored to create nothing can be left to chance. Today is best time to consider your many options for securing your business and your wealth for future generations. Here are just a few of the ways your wealth can be insulated and protected from economic crisis, unscrupulous individuals, or oppressive governments:

Structure your business for limited liability

This can include becoming an LLC or a corporation here in the US, but it may also encompass GmbH or Ltd business structures overseas. Creating an entity for your business helps insulate debts and liabilities from the owners.

Review contracts before signing

Reviewing your contracts and agreements with legal counsel before execution should be on the top of every business’s to-do list. There are many misconceptions about business and contract terminology that may change the meaning of the contract from what you intend it to be.

Use “hard” assets to insulate wealth

Hard assets are those which are characterized by physical properties and held by the owner, not by an agent or exchange. Examples of hard assets include: land, gold or silver bullion, or personal property (cars, boats, collectibles, etc.). Hard assets are in contrast to other “soft” assets (stocks, bonds, investment accounts) by the fact they are not subject to an agent or intermediary to access. While hard assets puts the property in your hands and full control, they are often more difficult to convert to cash. When looking into securing hard assets with your wealth, be sure to look at the long term protection plan.

Internationalize your wealth

One of the methods used by the wealthy for decades, offshore assets can be used to help balance your portfolio and protect you from a regional economic crisis. Although since the release of the Panama Papers, offshore wealth protection has been treated negatively, the majority of people use it to legally protect their wealth for their future. Internationalizing your wealth can be as simple as holding an offshore bank account in different currencies or as complex as an international trust holding your wealth overseas. Depending on your goals and wealth, a plan must be tailored to your needs.

Make today the day you begin securing your wealth, not tomorrow. Whether one of the steps above is for you or some other basic asset protection plan is warranted, call Reidel Law Firm today to discuss the options you have for protecting your wealth. Call (832)510-3292 or use the form below.