The Illusion of wealth
Wealth: we all chase after it. We all want to be debt-free, worry-free, and provide for our family and friends.
People are grappling with high inflation, stagnant wages, skyrocketing housing, and working “side hustles” to pay the bills. Did you know that even wealthy people are feeling this way? In 2023, 59% of what could be described as “affluent” U.S. citizens, feel secure in their assets. Compare this to the whopping 72% of Americans who felt the same, just a year before that, in 2022.
The wealthy are like us: worrying about rampant inflation. They’re not investing, they’re not taking risks with their money: they’re holding on to it, which could be a sign of how shaky the economy is right now.
The wealthy are saddled with substantial debts: they (much like the average joe) is struggling to pay off their mortgages, car loans, and wipe out their credit card balances. Yes, they probably struggle less than the average joe to pay their debts off, but struggling to pay off debts may lead to excessive borrowing. Just like the average joe, the wealthy too, should avoid maintaining credit card debts and pay off loans they have as soon as possible (easier said than done.)
One of the most pressing concerns for wealthy Americans is how much they have saved for retirement. Not just retirement, but their overall estate planning, which includes: paying taxes, paying off loans, ensuring that you have good life insurance, managing issues surrounding health, etc.
These are all things that people across every generation should think about, even cash-strapped Millennials and GenZ.
Taxes are going to become a concern heading into 2024: many taxes could increase in U.S. households. There are a number of taxes from 2016 that are set to expire in 2026. This means that taxes would increase for a number of families. Getting creative with estate planning is the answer.
One way to get around these tax cuts is to gift large trusts to children and other family members.
Hopefully, you’re off to a good start in 2024. You may be able to increase your wealth if you follow sound advice and do your research on estate planning.