Are You The Beneficiary Of Sudden Wealth—What Should You Do?
You’ve unexpectedly received a large sum of money—what should you do? You may find yourself overwhelmed—perhaps even paralyzed—as you try to work out how to deal with the significant surplus you now have over your everyday needs. This article highlights 3 key steps in planning how to handle sudden wealth in ways that are fulfilling and meaningful to you.
Map Out Your Goals
As you think about how to allocate your surplus wealth, you might initially be tempted to purchase goods or services that have previously been unattainable or pursue investment opportunities to make more money. But before taking any action, take a moment to reflect and consider what is most important to you, what you find fulfilling, and perhaps even think about what you had wanted to accomplish prior to the windfall.
Going through this personal exercise will help you identify your goals through the lens of what success means to you and how it will be measured. Having established a clear set of objectives, you can then proceed with putting together a team of professionals to help you achieve your goals.
Build Your Team
With your priorities laid out, you will likely wish to enlist the help of professionals across the necessary disciplines to support the pursuit of your goals. For instance, if protecting and growing your wealth while generating independent cash flow is important, you should look for the services of an investment professional. Investment advisors, portfolio managers, and financial planners represent a fairly broad group with potential overlap between roles. They employ a variety of approaches and styles in managing clients’ money, so you may wish to start by interviewing a number of different professionals, including those from large banks and boutique investment firms, to see who may be the best fit for you.
You may also wish to consult with legal and tax professionals, as well as other more niche services, depending largely on what your personal goals are. For instance, a desire to pass down the wealth to future generations may merit the involvement of an estate lawyer to set up trusts which operate in accordance with your wishes. Alternatively, if philanthropy is a key priority, then you may wish to seek out professional advisors who specialize in philanthropic planning and in connecting donors with the causes that suit them best. In brief, your eventual roster of supporting professionals will more than likely be a function of the goals that you defined during your self-reflection.
Measure Your Progress
With your goals established, your team put together, and your strategies deployed, it is important to regularly check in on the progress you’re making. In identifying your priorities, you have also defined what success should look like. Quantifying key milestones can help you judge whether or not you are on track. It is important to review your investments, your planning, and any structures or initiatives in place to ensure that not only do your strategies continue to reflect your current priorities, but also that they are delivering acceptable results.
Bloom Investment Counsel, Inc. is a well-established Toronto-based independent, privately-owned boutique investment management firm providing customized, actively managed, Canadian and U.S. dividend-paying portfolios for wealthy individuals, family offices, foundations, corporations, institutions and trusts.
Founded in 1985, Bloom has experience in managing in excess of $2.5B in assets over the years. We believe that generating independent cash flow is central to the success of our clients’ portfolios because it provides capital for the present day, if needed, while continuing to preserve and build wealth for the future.
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This content is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this content should consult with his or her financial partner or advisor.