Take 15: Five Ways to Protect Your Wealth

In the last article in this series, I gave five ideas for protecting retirement assets. That asset is only one among many that every one of us has in our lifetime, and we depend on all the others for retirement income — remember the three-legged stool?

Every asset you own carries a risk. The broader category of wealth protection means taking 15 minutes once each month to identify any new risks and prepare coverage to manage them. Life is not like it once was portrayed on Leave It to Beaver.

A serious wealth-protection plan also prepares for lawsuits, disability, fraud, incapacity, probate, family conflict and decisions that are too complex to handle without specialized advice. The goal is not to eliminate every risk. It is to identify the risks that could cause the greatest damage and put practical safeguards in place before a crisis occurs — manage the risk. We each have different risks to identify but you need to know what to look for and resources to help manage your situation.

The five strategies below work together. Insurance transfers certain catastrophic risks. Identity-theft controls reduce the chance that criminals can reach your accounts or credit. Durable powers of attorney and revocable trusts help trusted people act when you cannot. Probate-avoidance tools can simplify the transfer of property at death. Finally, timely professional advice can prevent expensive and sometimes irreversible mistakes.

Likely, most all these strategies apply to you or someone in your retirement economic unit.

1. Use Insurance to Transfer Risks You Cannot Afford to Bear

Insurance is most valuable when it protects against a loss that would be financially devastating. The right question is not simply whether you have insurance, but whether the limits, exclusions, deductibles and ownership arrangements still match your current assets and obligations.

A coordinated insurance review may include the following:

• Homeowners’ or renters’ coverage, including adequate replacement-cost protection and attention to exclusions for floods, earthquakes, jewelry, collections, home offices and other special property.
• Automobile liability coverage with limits that reflect the assets and income that could be exposed after a serious accident — especially if you have a loan on the automobile.
• Personal umbrella or excess-liability coverage, which may provide an additional layer above home and auto liability limits.
• Disability-income insurance, particularly for people whose future earning capacity is their largest financial asset, and the family economic unit depends on this income.
• Life insurance when others depend on your income, when liquidity will be needed at death, or when insurance is part of a business or estate plan — especially if there is debt to be paid at your death.
• Long-term care coverage or another deliberate plan for paying for extended care, which may include home care, assisted living or nursing care.
• Business, professional liability, cyber, directors and officers, employment practices or other specialized coverage when personal wealth is connected to a business or professional practice — cyber is not always included in any meaningful way in most general insurance policies.

Review coverage after major life events: new car or house, marriage or divorce, the birth of a child, retirement, a business transaction, a substantial increase in net worth, or a move to another state.

Long-term-care insurance is not just for the elderly and it requires careful review of benefit triggers, elimination periods, inflation protection and the insurer’s right to increase premiums. Be sure to compare coverage.¹

2. Understand Identity Theft Before It Reaches Your Wealth

Do you leave your house without locking its doors and windows? Identity theft is not limited to fraudulent credit-card charges. A thief may use personal information to open new credit accounts, take over an existing account, redirect tax refunds, obtain medical services, impersonate a government agency or financial institution, or persuade a victim to transfer money voluntarily.

Wealth can be lost even when the underlying investment portfolio is sound. You need to lock as many of these opportunities that you can control.

Fraudsters are winning this wealth scam game. The Federal Trade Commission reported that consumers submitted more than 1.1 million identity-theft reports in 2024. The same data release stated that consumers reported losing more than $12.5 billion to fraud in 2024, a 25% increase over the prior year. More recent FTC data show that reported fraud losses reached approximately $16 billion in 2025, including $3.5 billion attributed to imposter scams.

A practical protection plan should include several layers:

• Freeze your credit reports with all three nationwide credit bureaus (Equifax, Experian, TransUnion) when you are not actively applying for credit. A freeze is free, does not affect your credit score, and remains until you lift it.
• Use unique passwords created by you and what you are familiar with or use a password manager such as OnePass or Dashlane, and multi-factor authentication for all financial accounts. Protecting email is especially important because password-reset links often flow through it.
• Turn on alerts for logins, password changes, transfers, withdrawals and changes to contact information for all your online financial accounts to get daily alerts rather than relying solely on monthly statements.
• Treat unexpected calls, texts, pop-ups and emails as unverified. Delete these e-mails and hang up and contact the institution using a known telephone number that you keep on your phone to quickly verify the caller’s claim.
• Limit personal information available through social media. Shred discarded documents and securely shred unsecured devices.
• Create a response plan so family members know whom to contact if fraud is suspected. When my kids were little, we had a code word for when someone different was picking them up from school — if the person did not know the code, my kids knew not to go with them. Use this technique for family emergencies to identify family members.

Credit freezes are available to anyone, are free to place or lift, and do not affect a credit score. A freeze does not, however, stop misuse of an existing bank, credit card or investment account. That is why account alerts, rapid review and strong authentication are necessary.

When identity theft occurs, speed matters. IdentityTheft.gov can generate an Identity Theft Report and a personalized recovery plan. Read it now — before you need it — and make it a gift for your family members to read.

3. Put Durable Powers of Attorney in Place Before a Crisis

A durable financial power of attorney allows a person you select to act for you under the authority granted in the document. “Durable” generally means that the authority continues even if you later become incapacitated. It can permit the agent to pay bills, manage accounts, sign tax documents, handle property, deal with insurance, operate a business and take other specified actions.

Without an effective power of attorney, a spouse or adult child may not automatically have authority to manage property titled solely in your name. If incapacity occurs, the family may need to ask a court to appoint a guardian or conservator. This court process can be lengthy, expensive and public.

A power of attorney should be tailored rather than treated as a generic form. This is the time you employ an attorney. Important decisions include:

• Who should serve as the initial agent and successor agent, and whether co-agents would create safeguards or unnecessary delay.
• Whether authority is effective immediately or only after a defined determination of incapacity.
• Whether the agent may make gifts, change beneficiary designations, create or amend trusts, handle digital assets, manage a business, or engage in Medicaid or tax planning.
• What records the agent must keep and whether periodic accountings should be provided to another trusted person.
• How the document coordinates with trusts, joint accounts, retirement plans, insurance and health care directives.
• Whether financial institutions should review or retain a copy before the document is urgently needed.

The authority is powerful and creates the risk of abuse. Choose someone you genuinely trust, inform other trusted people and advisers about the arrangement, and consider a requirement that the agent report transactions to another person. An agent is a fiduciary and generally must act in your best interest, manage property carefully, keep funds separate and maintain complete records.

4. Use a Revocable Trust and Other Tools Deliberately to Avoid Probate

Probate is the court-supervised process for administering property that passes under a will or under state intestacy law. Avoiding probate can reduce costs, delay, preserve privacy and simplify administration in some circumstances, but probate is not automatically disastrous and avoiding it should not become the only estate-planning objective.

Many assets already pass outside probate and that the actual value of avoiding probate depends on your circumstances.

A revocable living trust can be useful because the person creating the trust may retain control while living, name a successor trustee to manage trust property during incapacity, and direct how trust property will be distributed at death. Assets properly transferred to the trust generally are administered under the trust rather than through probate. The trust can also provide continuing management for beneficiaries who are young, have disabilities, struggle with finances, or should not receive an inheritance outright.

Signing the trust agreement does not move an asset into the trust. Real estate may need a deed, financial accounts may require retitling, and business interests may require assignments or compliance with governing agreements. A trust that is never funded may fail to accomplish its central purpose.

Other common non-probate transfer methods include:

• Beneficiary designations for retirement accounts, life insurance and annuities.
• Payable-on-death (POD) designations for bank accounts and transfer-on-death (TOD) registrations for eligible securities accounts.
• Transfer-on-death deeds for real property where authorized by state law.
• Joint ownership with survivorship rights when the ownership arrangement fits the tax, creditor and family objectives.

A beneficiary designation ordinarily controls the asset even if a will says something different. Joint ownership may expose property to another owner’s creditors or cause an unintended inheritance. A carefully drafted estate plan therefore looks at every asset, how it is titled, who is named as beneficiary, and what happens if the first-choice beneficiary dies or becomes incapacitated.

5. Know When Paying for Expert Advice Protects More Than It Costs

I am a big believer in surrounding myself with people smarter than myself and encouraging them to help me by being a regular supporter of them. My goal is to be a good client. Just because I am a CPA and attorney does not mean I should be my own client.

In those situations, the cost of advice should be compared with the cost of a mistake — not with the cost of doing nothing.

Professional advice is especially valuable before:

• Selling a business, real estate or a concentrated investment position.
• Planning end-of-life decisions, including living wills, do-not-resuscitate orders, and health care consent.
• Retiring, beginning major account distributions or making a large Roth conversion.
• Entering a second marriage, divorce, prenuptial agreement or blended-family estate plan.
• Giving away significant assets, adding a child to a deed or account, or making loans to family members.
• Signing a power of attorney, trust, buy-sell agreement, personal guarantee or complex insurance arrangement.
• Moving to another state or owning property in multiple states.
• Responding to an IRS notice, creditor claim, lawsuit, suspected exploitation or identity theft.
• Planning for a family member with disabilities, addiction concerns, creditor problems or limited financial experience.

The appropriate adviser depends on the issue. Look to those who specialize in what you are looking for. Credentials alone are not enough. Ask what services will be provided, who will perform the work, how the adviser is compensated, what conflicts may exist and whether the recommendation will be coordinated with your other advisers.

The Securities and Exchange Commission urges investors to confirm registration and review background information, fees, conflicts and disciplinary history through Investor.gov and related databases. The SEC also emphasizes reviewing Form CRS, Form ADV and other fee disclosures and asking for fees to be explained in dollars.

The most effective professional team is coordinated. An estate plan may fail if the attorney drafts a trust, but no one retitles the accounts. A tax strategy may create liquidity problems if the financial adviser is not involved. Insurance may be owned or designated in a way that conflicts with the estate plan.

Take 15 minutes annually

At least once a year, and after any major life event, review the following questions:

• Would a serious accident, disability, death, lawsuit or long-term care need overwhelm current insurance or available cash?
• Are credit freezes, account alerts, multi-factor authentication and family fraud protocols in place?
• Are durable financial and healthcare powers of attorney current, accepted and held by the right people?
• Is the revocable trust funded, and do account titles and beneficiary designations match the estate plan?
• Are there upcoming decisions where legal, tax, insurance or investment advice could prevent an irreversible mistake?

Wealth protection is most effective when it is completed before it is needed. Documents should be signed while capacity is clear. Insurance should be purchased before a claim occurs. Security controls should be activated before an account is compromised. Beneficiary and ownership arrangements should be coordinated before death.

The result is not only greater protection of assets, but also clearer authority and fewer burdens for the people who may someday need to help you.