Every wonder how the super wealthy manage their vast fortunes? Here the WSJ reports on some of the financial strategies of the ultra-wealthy ($10 million or more in investable assets).
Consolidate Your Accounts
To prepare for his portfolio defense, Mr. Lerner created a spreadsheet of all his accounts, assets and liabilities. Putting everything down on one spreadsheet helped him get a clear, organized picture of what he owns and owes, he says.
It also reminded him of something he thinks when he gets yet another financial statement in the mail. “I have too many accounts,” he says.
During the meeting, he pledged to consolidate his 12 separate brokerage accounts into two. He also plans to consolidate 10 separate bank accounts into two.
Keep Some Cash Handy
At the portfolio defense, Tiger 21 co-founder Michael Sonnenfeldt wondered why Mr. Lerner was holding about 4% of his portfolio in cash and cash equivalents. “That’s low compared to our average Tiger member who is holding about 12%,” Mr. Sonnenfeldt said.
Mr. Lerner was in fact concerned that he didn’t have enough cash on hand, but it wasn’t because he was worried about paying his bills. Rather, he was worried he wouldn’t have the dry powder available to buy attractive stocks quickly. “I don’t know what Trump’s victory is going to mean in the new year for stocks and I want to be ready,” Mr. Lerner says, referring to President-elect Donald Trump’s incoming administration.
If you are looking to consolidate all your accounts under one roof, Fidelity would be our top choice for most investors. Read more here.
Jeremy Jones, CFA
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