Dos and Don’ts on Windfall Wealth:
Treat it like a Powerball win
- Tell no one, not even family. If you must talk, do so with one who is already in the know.
- Don’t run out & buy new “stuff”. People notice.
- Get an unpublished number and give it out very sparingly.
- Get a tax accountant you can trust to make sure the IRS is satisfied (Certified Opinion is something to look into) and pursue asset protection.
- Move slowly (e.g. change of car, address, furnishings). People notice.
- If you are going to stay where you are look into fire/burglar protection. They have all sorts of extras nowadays and you do not have to advertise them or for them.
- Get identity theft protection. There are several companies out there – check them out, ask for preferences from those who have it.
- Reduce and remove debt. Stay on top of your credit report. I don’t believe in paying these outfits to check regularly. An identity theft protection company should be able to tell you if someone accesses it or affects it
– Life Lock. Remember – once out your phone & mail will be swamped with requests for money and “offers”. Friends and relatives you never knew you had will show up at your door with a “problem”. You will get swamped with charity “membership renewals”, calendars, cards, tokens, key rings, etc. all with donations in mind. Giving comes from the heart.. Make sure taxes are paid and be aware of future tax liabilities incurred from your investments. For information on what to go with, invest with, work with, be diligent. Check it out.
Ask those who also have wealth.
Never, ever make a major decision on the spot. That boat, car, house, etc. is not going to go away while you sleep on the decision.
Bank - Consider the following:
IQD verified on the premises - verify notes while present Guarantee immediate access - No holdups
POD accounts (Payable on Death)
CDARS (Certificate of Deposit Account Registry Service) – is FDIC on very large accounts
Post RV Checklist:
1. Change your number, make sure the new number is unlisted. If you don’t, every Tom Dick and Harry will be knocking down your door when they find out about your new circumstances.
2. Contact an attorney that specializes in taxes and trust accounts.
3. Set up your family trust(s).
4. Contact your bank(s) and set up POD accounts.
5. Do not deal with banks that have derivatives and hedge funds.
6. Set up CDARS accounts.
7. Pay off ALL debt.
8. Fix everything that needs repair.
9. Upgrade your personal, home, auto and umbrella insurance.
10. (Consider ransom insurance too!)For your family/children
11. Set aside enough liquid funds for you to survive for 2-3 years. This should account for every expense you have on a monthly basis – don’t go short!
12. Invest in precious metals (like gold & silver or Rare Earth Metals).
13. Go to seminars to learn to make money through SMART investments.
14. PAY YOUR TAXES!
15. Pick your friends wisely.
Someone will be “watching you” so you’ll want to do the following:
1. Be very low key (non-descript).
2. Don’t flaunt your newly obtained wealth.
3. Open up a secure Email address.
4. Get a new cell phone number; cancel the old one.
5. Get a P.O. Box
6. Put a security system in your house.
7. Install high security Medco bolt locks, and a heavy duty safe.
8. Install reflective film on your home windows.
9. Consider building a safe room.
10. Get training in self-defense / firearms.
11. Use PGP (or better) encryption on your computer and Email.
12. Don’t trust anyone … keep your friends close and your enemies closer.
Questions to ask your private banker before you cash in. Also ask about Tag accounts, non interest accounts, that do not comply with the 250K maximum for FIDC accounts. No Limit.
Questions to Ask Private Bankers, Questions to Ask Financial Planer Some Overlap
1. QUESTION TO ASK PRIVATE BANKER -
Questions on the organization of the bank/private banker
What is the minimum amount to be invested? (This gives you a good feel whether the bank targets private banking clients that are similar to you)
What is the value of assets under your firm’s management? (The number shows if it is a big institution with international reach or a smaller boutique. Don’t forget to ask if the number has been growing or falling lately, and why)
Since when have you been in the business of private banking? (Gives you a feel about their level of experience)
Questions on the investment philosophy
Describe your investment philosophy (Should match your philosophy as closely as possible)
What are your weaknesses? (If they can’t name any, then it stinks)
What sets you apart from other wealth managers and private bankers? (Don’t be satisfied with a general answer, insist on specifics)
Are your performance figures verified by an independent third party? (Yes: good, No: bad)
What is the process you follow for making investments? (There should be a clear step-by-step process, which involves a written evaluation of your preferences and wishes)
Questions to the private banker directly
To the adviser, directly: What qualifies you to provide wealth consultancy? (Again, you should insist on specifics like his level of experience or business degrees)
To the private banker, directly: What is the your personal remuneration based on? (Is it based on how much fees he generates from you? Or is it based on the overall performance of his clients’ portfolios. If there is no clear answer assume the former)
Questions on private banking fees
What are your fees? (Ask specifically about transaction fees, flat fees, ticket fees, government fees...there are many ways by which they plan to part you from your money)
Are there any hidden costs in the portfolio? If yes: How large are they typically? (Like fund fees, kickbacks)
These are the questions that you should definitely ask in the first round to get all the basic facts and a good first impression about the private banker. However, we highly recommend you to dig deeper before you make you final decision.