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Maximizing Wealth

Strategies for
$20 Million+
Portfolios

Did You Know?

Only 3% of high-net-worth individuals feel fully confident in their wealth management strategies? Managing a substantial portfolio requires a strategic approach tailored to your unique financial situation. At Bilyk Financial, we specialize in providing customized financial services for high-net-worth individuals in Canada. Discover how you can maximize the potential of your $20 million+ portfolio with these proven strategies.

Diversification: The Cornerstone of Wealth Management

Diversification is key to minimizing risk and optimizing returns. Here’s how to effectively allocate your assets:

Asset Allocation

Allocating assets effectively can help balance risk and reward. Here’s a typical asset allocation model for a $20 million+ portfolio:

  • Equities: 49%
  • Fixed Income: 12%
  • Real Estate: 10%
  • Alternative
  • Investments: 29% (broken down below):
    • Private Equity: 8%
    • Infrastructure: 7%
    • Commodities: 5%
    • Multi-strategy: 5%
    • Private Credit: 5%

Risk Management: Protecting Your Wealth

High-net-worth portfolios require robust risk management strategies to protect increasing and changing tax regimes.

Insurance Products

Using insurance products like life insurance can provide additional layers of financial security.

  • Life Insurance: Besides providing a death benefit, life insurance can be a valuable estate planning tool.
  • Term Life Insurance: Provides coverage for a specified term, offering a death benefit if the policyholder passes away during the term. It’s a cost-effective way to ensure financial security for beneficiaries.
  • Permanent Life Insurance: Includes whole life and universal life insurance, offering lifelong coverage with an investment component that builds cash value over time.
  • Whole Life Insurance: Provides fixed premiums, guaranteed death benefits, and cash value growth based on a fixed interest rate.
  • Universal Life Insurance: Offers flexible premiums, adjustable death benefits, and the potential for higher cash value growth based on investment performance.
  • Estate Planning Benefits: Life insurance can be used to cover estate taxes, ensuring that heirs receive the full value of the estate. It can also provide liquidity to pay debts and expenses, preventing the need to sell assets quickly.

Learn how insurance products can safeguard your legacy.

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Tax Efficiency: Maximizing After-Tax Returns

Tax planning is critical for preserving wealth. Effective tax strategies can significantly enhance after-tax returns.

Tax-Loss Harvesting

Implementing tax-loss harvesting strategies can offset capital gains with capital losses, reducing overall tax burdens.

  • Offsetting Gains: Selling underperforming investments to realize losses can offset gains from other investments.
  • Reinvestment: Proceeds from the sale can be reinvested in similar assets, maintaining the portfolio’s overall strategy.

Want to know more about tax-efficient strategies?

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Estate Planning: Securing Your Legacy

Estate planning ensures your wealth is preserved and transferred according to your wishes.

Trusts and Foundations

Establishing trusts and foundations can provide tax benefits and ensure your assets are distributed as intended.

  • Trusts: Trusts can help manage and protect assets, reduce estate taxes, and ensure a smooth transfer of wealth. Different types of trusts, such as family trusts or charitable remainder trusts, can be tailored to specific needs.
  • Foundations: Setting up a private foundation allows for structured charitable giving, providing tax benefits and a lasting legacy.

Charitable Giving

Incorporating charitable giving into your estate plan can provide tax deductions and support causes you care about.

Donor-Advised Funds

Donor-advised funds offer a flexible way to manage charitable donations, providing immediate tax benefits while allowing you to support your favourite causes over time.

  • Educational Opportunities: Involving family members in DAFs can educate them about financial management, investment strategies, and the importance of giving back.
  • Strategic Giving: You can plan your giving to maximize the impact on your chosen causes, ensuring your contributions make a significant difference.

Succession and Wealth Transfer: Ensuring Continuity

Effective succession planning is essential for maintaining and transferring your wealth across generations.

Business Succession Planning

For those with family businesses, succession planning is crucial to ensure a smooth transition.

  • Succession Plan: Developing a detailed succession plan can prevent conflicts and ensure the business continues to thrive.
  • Leadership Training: Preparing the next generation with the necessary skills and knowledge to take over the business is vital for long-term success.

Family Governance

Establishing family governance structures can help manage family wealth and business interests.

  • Family Constitution: Creating a family constitution can outline the values, vision, and rules governing the family’s wealth and business.
  • Family Council: A family council can serve as a platform for discussing family matters and making joint decisions, fostering unity and cooperation.

Ensure your family’s wealth and business continuity.

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Conclusion

Managing a $20 million+ portfolio requires a sophisticated approach, balancing growth and preservation of wealth. At Bilyk Financial, we offer personalized financial strategies to help you.