Imagine this: A financial advisor, well-regarded for building robust investment portfolios, discovers one of their clients has been blindsided by an unforeseen risk. Their teenage son was involved in a car accident, and while the family thought their insurance was sufficient, it wasn’t. A lawsuit followed, targeting their son’s assets and putting their wealth—and lifestyle—at significant risk.
This real-world scenario underscores why conducting an annual review of unexpected risks is critical.
As your wealth grows, particularly after a strong year in the stock market, your financial landscape changes. Higher balances and appreciating assets can attract potential legal claims, making it essential to reassess whether your current protections are adequate.
What Risks Could Be Lurking?
Many people focus on growing their wealth but overlook the importance of protecting it. Here are some common gaps that can lead to devastating consequences:
Liability Insurance: Do your homeowner’s and auto insurance policies provide sufficient liability coverage? Umbrella insurance could offer a crucial layer of protection.
Health Events: If someone in your family faces a major medical crisis, would your insurance truly cover all expenses without derailing your financial plan?
Travel Insurance: Do you regularly travel abroad? Do you have adequate travel insurance? Have you considered a medical concierge to coordinate care?
Cybersecurity Threats: In a digital age, is your personal and financial information secure? Have you hired an IT consultant to review your vulnerabilities?
The Benefits of a Comprehensive Review
An annual review isn’t just about ticking boxes; it’s about maintaining peace of mind. A skilled wealth manager will help you:
Identify risks that could harm your financial stability or lifestyle.
Adjust your protection strategies to align with your current wealth.
Ensure you’re prepared for potential “what if” scenarios, like lawsuits, long term care, medical emergencies, or even natural disasters.
Protect What You’ve Worked Hard For
While you may have seen your portfolio grow over the past year, true financial success goes beyond returns—it’s about safeguarding the lifestyle and legacy you’ve built. Don’t wait until a crisis exposes a gap. Work with your advisor to schedule an annual review of unexpected risks. Remember, it’s not just about wealth; it’s about security and the confidence to enjoy what you’ve achieved.
Final thought.
Are your financial protections keeping up with your success? From liability coverage to cybersecurity, an annual review can help safeguard your wealth and lifestyle. If your net worth exceeds $2 million and you’d like expert guidance, the Peak Wealth Planning team is here to help.
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About the Author
Peter Newman is a Chartered Financial Advisor (CFA®) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind.
Peak Wealth Planning offers personalized concierge services to meet your wealth management needs, including financial planning, investment management, ESOP diversification, retirement income, insurance, and estate planning. As a fee-based financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states.