Where Wealthy keep their money?! How do they diversify their ‎portfolios?!‎

A recent report issued by the International Wealth Consulting Company, which provides advisory services in the field of business management, indicates the need to diversify large capitals to protect against risks. “You can’t put all your eggs in one basket.” Rich people understand this, so they convert their money into assets with varying degrees of liquidity. Usually, billionaires distribute money in different directions based on the following principles:

Some assets must generate passive income (usually these are long-term investments), and passive income is defined as the cash income flowing on a regular basis resulting from investing in a specific project without the need for the physical participation or physical presence of the investor obtaining the income, and the report warns Some of the money must be safely hidden from devastating wealth taxes, unstable political systems, and unfair legislation that allows for property confiscation or penalties. Also, savings should be kept in the form of highly liquid assets to convert them quickly into cash without tangible losses.

A small part of the assets can be directed to very profitable, albeit risky, investments according to this principle: if everything works out and you are lucky, you will get an additional profit, but if the idea turns out to be unviable, you must be ready to lose The entire investment.

The report looked at common and proven ways to save and increase money used by billionaire investors. How do the wealthy (owners of great wealth) protect their assets from the risks of inflation and confiscation, and bypass the restrictions imposed on the export of assets abroad? The report discusses several answers below:

1. Retention of passports and residence permits: The second nationality (as well as the third, fourth, etc.) does not have to be an investment nationality. There are other ways to establish a legal relationship with another country: Spend a few years naturalizing, and have a child in a country where citizenship by right of land is allowed, including (Commonwealth of Dominica, Mexico, Costa Rica, Cuba, Argentina and Brazil).

Take advantage of resettlement programs, and take steps to become an honorary citizen to receive special services for your new home (many countries don’t have official citizenship through investment programs, but if you invest enough in the economy, the government will notice). In general, it is important to choose a suitable country and then decide how to obtain a new passport or residence permit because legal contact with another country is an excellent opportunity to:

Pay taxes in another jurisdiction at fairer rates Register a new business Expand business opportunities Open an offshore bank account to store money Simplify settlement processes to find a safe haven where you can get it in bad times.

Of course, a spare passport can hardly be called a direct tool for storing money. At the same time, the new citizenship opens up additional opportunities for movement and travel around the world, transferring part of the assets to a safe place, new investments, and improving taxes. Additional passports and residence permits are not in vain, but they provide the most profitable and safest investment options for billionaires.

1. Deposit accounts in banks:

As confidence decreasing in the banking system in various countries due to the spread of cryptocurrencies, electronic wallets, and frequent news about seizure of bank accounts, billionaires have long understood that many banking institutions should not be trusted.

For a long time, the reputation of Swiss banks has been preserved, but in 2023, the reliability of these organizations has also been shaken. When, for example, one of the country’s largest banks, Credit Suisse, came close to bankruptcy. Be that as it may, bank deposit accounts are still a tool for billionaires to store money and receive passive income, but nowadays the rich choose financial institutions more carefully. In particular, opening an account in a foreign bank is preferred by billionaires especially as it brings an added advantage – investment citizenship (also called “golden visa”).

For example in Turkey, to obtain a second passport, a candidate has to choose between investing in a property worth more than $400,000 or depositing $500,000 into a deposit account at a local bank. In Spain, to obtain a “golden residence permit”, you need to buy real estate worth more than 500,000 euros or open a deposit in a local bank for 1 million euros. In Portugal, to obtain a “Golden Visa”, you must make a real estate investment of more than 500,000 euros or deposit 1.5 million euros in a bank.

1. Real estate and real estate funds:

Real estate investment is not limited only to residential buildings, but also includes non-residential real estate (separate buildings for various purposes, private commercial facilities: parking lots, student residences) and of course plots of land.

1. Cash:

The good old cash will never lose its appeal because it is the most liquid asset when most of the capital is invested for the long term and is trading. Of course, the wealthy choose carefully to coordinate their cash for storage. This is certainly not the dollar, the euro and the ruble, which do not keep up with inflation. Billionaires choose a fixed-rate global currency: the Swiss franc. The Swiss Franc is backed by 40% of gold. Over the past decades, the franc has only been growing. China’s role in the global economy is becoming stronger and stronger, which means that the national currency is traded internationally.

Among the global reserve currencies are the currencies of the Middle East countries (UAE Dirham, Omani Rial, Saudi Riyal). These are not widely traded currencies, but the money of the oil-producing regions is the best protection against inflation in the world.

1. Miscellaneous goods:

It includes luxury items and products that improve the quality of life. Billionaires buy all of these commodities with the other goal of reselling them at a higher price or not losing too much value. Such as rare art pieces, antiques, jewelry, precious metals.

1. Agricultural land:

As the population increases, so will the price of land on which something can be grown for food, not just plots of land on which a building can be built. Of course, billionaires will not personally engage in agriculture or livestock breeding, but they will invest in an agricultural project because this field is future.