How to Keep Your Wealth Safe

Shark Circling | Keeping Your Wealth Safe

It’s been said keeping wealth is harder than getting wealth.

You may be wondering how to keep your wealth safe. Cyber security, mail fraud, bear markets, liabilities, leverage and lack of diversification all pose risk for your wealth.

In this post, I’ll address 11 ways to help keep your wealth safe from each of these lurking risks based on what I’ve learned from almost 40 years of investing, a cyber security program, and my Accredit Financial Counselor® education.

Cyber Security

Using a website to manage insurance, banking, and investing has become a necessity. This means our data is in more places online.

While there is nothing you can do to keep a major company from being hacked, much cyber theft comes from lack of security by individuals. And, that, you can control!

A few years ago, I participated in a cyber security program taught by someone who had worked at the FBI in cyber security. Plus, my son recently finished his degree with a focus on cyber security so he has been drilling this into my head for years.

Below are the steps I have learned and implemented to do everything we can to protect our data online.

Use a Password Protector

Use a password protector to store and share all your passwords. You can share easily share passwords among family members.

Note that while at least one password storage company was hacked in the past, this method is safer than emailing or texting passwords according to the program.

If you’re an entrepreneur like us, you can also share select passwords among team members, and remove them instantly if the need arises.

There are a couple of super important passwords I keep outside of the online password storage service we use; our brokerage account logins and our password protector login. It’s just too much of a risk.

You may want to do the same. Sticky notes do still come in handy sometimes.

Avoid Duplicate Passwords

It took a while to get out of the habit of using duplicate passwords because it’s hard to remember a lot of different passwords. But when you use a password protector, you don’t need to remember all your passwords.

Don’t use the same password more than one place. Don’t use names, birth dates, dog names, and such. My cyber security savvy son informs me this is all already in the “black market”.

Use Encrypted Passwords

Just the word encrypted sounds like something I want to avoid, but this simply means to use random letters (both small cap and large cap), numbers and symbols.

Here is an example of an encrypted password: x9e$74mZ!Lq9p

The longer your passwords are, the better. Now you see why password protectors are so useful. And they will actually create, save and also fill in the password for you when you go to login.

Use Two Factor Authentication for Financial Accounts

Again, this one sounds complicated. Admittedly, it is a bit of a hassle, but we use it extensively. When you set up 2 factor authentication (2FA) the person trying to access your account must enter a security code that is sent to you before access is allowed.

Note that this person is normally you, so it’s not a big deal, really.

The code can be texted to you and then you provide it to the other person if it isn’t you. If you are guarded about giving out your cell phone number, you can usually have the code called to your landline.

Two factor authentications usually ask you if you want your device remembered, so 2FA is often triggered only with new devices.

It’s smart to use 2FA any place you have data like social security numbers, investment account numbers, and your money.

Financial Data in the Mail

While mail feels safer than the internet sometimes, mail can easily be stolen. Fortunately, most organizations no longer include secure data via mail.

Shred brokerage statements, tax returns and other secure papers. I don’t like to leave our documents with the employee at the office supply which provides shredding. It makes sense to me that this person could steal our data.

An alternative is to take your papers where you can shred them yourself. Many churches, neighborhoods and organizations get shredders to come to their location periodically so everyone can shred their own documents.

My CPA has a big bon fire at his ranch every few months, but this may not work for you.

Liability Protection Keeps Wealth Safe

Liability is a big risk in the U.S. We all knew it was completely out of hand when the woman sued McDonald’s and won because she spilled her coffee on herself.

Umbrella Insurance

A blanket umbrella policy can be taken out very inexpensively to cover almost any personal liability that arises beyond car and home insurance protection limits. The cost is minimal to go a little above your current net worth since it is, hopefully, increasing.

Click here to read my related post with 6 ways to increase net worth before retirement. 

Other Liability Insurance

Protect yourself.  I am not an insurance expert but there are many insurance experts who would be glad to hook you up with the protection you need.

This is not an expense to avoid.


When my PC guy asked several times for my brokerage account login so he could download the trading platform I use I got a new PC guy. Duh.

Protect your PC. Destroy old hard drives. My son says that there are unethical hackers that can get data off hard drives that have been wiped clean and sell the data.

The last thing you want is for someone to access your brokerage account where the bulk of your wealth is.

Net Worth in Home Can Lower Risk

I learned from my Accredited Financial Counselor® studies that a home is one of the safest places to have your net worth in the event of various liabilities and issues.

Click here to read my related post How Much of My Net Worth Should Be in Cash? 

In other words, a lot of your net worth is in your home. This is contrary to conventional financial advice, but older individuals tend to have high home values and high home equity anyway.

If you have high liability due to life factors, this could possibly even offset the benefits of downsizing.

Click here to read my article Is Downsizing Right for Me?

Keeping Wealth Safe from Leverage

There are many stories of investors going bankrupt after being overleveraged from buying rental properties. Dave Ramsey says this was how he became against all debt.

Not all leverage is bad, but it must be used cautiously to keep your wealth safe.

Brokerage Firms

It is very rare, but brokerage firms and banks do go under. There is a certain account size that is covered by the brokerages firm’s insurance.

The FDIC covers bank deposits up to $250,000 per account for most banks. And there is often additional insurance, too. It’s up to you to make sure your bank is insured since this will vary among institutions. (1.)

Here is a list of failed banks.  (2.)

I was shocked at how many there were. There were 51 failed banks in 2012, for example!

Here is more information from the FDIC on bank insurance. (3.)

Below is my video about keeping all your investments in one place but come right back for 4 more important ways to keep your wealth safe.


Diversify Your Wealth

Diversification is one of the most common ways to keep your wealth safe. Diversification happens when assets are in different types of investments.

The plan is for some of those investments to move up when others move down.

I think income diversification also makes sense as an extra layer to keep your wealth safe in the event of income loss from one major source. This allows investors to avoid having to sell assets to pay expenses during income loss that would trigger a loss or a big tax bill.

Income diversification can come in the form of jobs, but investment income, real estate income or small online business income are my favorite diversified income streams.

Click here if you want to read my post with more about diversification among investments. 

Stock Market Cycle Awareness Helps Keep Wealth Safe

Many investors assume their wealth is safe if they are in high quality stocks but almost all stocks drop significantly during bear markets.

The average bear market is about 34% and it happens about every 3.5 years on average.

And investors of the popular Nasdaq based index funds saw losses of over 77% during the early 2000’s bear market. They did not get back to break even for 15 years! (5.)

And the “safer” S&P 500 stock index fell over 49% during that bear market.

Then only 5 years after the dot-com stock market crash, the S&P 500 dropped over 56% in the bear market that began in October 2007.

These back to back bear markets hurt older investors, especially those headed into retirement. This is when we began creating diversified income streams from alternative investments which I write about here in my eBook.

To see how much a bear market will affect your wealth, do my quick Stock Drop Factor on my article How Will a Bear Market Affect You?

Stock market corrections are a fact of life for buy and hold stock investors. But an awareness of stock market cycles and adjusting investments as risk increases can help keep your wealth safe.

Click here to read my related post about cash allocation in portfolios.

And while bonds are often thought to be completely safe, most bonds go down in value when interest rates rise. Plus, bonds have other types of risk.

Click here to read my post What Are the Risks of Bonds.

Check Out Financial Advisors

You can check out any financial advisor you are hiring at this link on the Finra website here.

This won’t protect you from stock market declines and bad investments made on your behalf. But it will show you if a financial advisor has been sued or had disciplinary action.

Click here to read my post on how to avoid problems when hiring a financial advisor.

Know Your Investment Risk

Long term investment averages can be deceiving. Check the annual performance for any fund you are considering buying or that you already own for a good estimate of the potential risk.

Adjust your portfolio if you feel too much of your wealth is at risk. Remember that the amount of risk you take is a choice.

You’re not a victim of any investment you own when you take this approach.

Click here to read my post 10 Ways to Reduce Investment Risk with more about this.

Summary for How to Keep Your Wealth Safe

Now you have 11 ways to help keep your wealth safe. Improve any of the areas addressed here to make keeping wealth easier than getting wealth.

Click here to get my eBook with our favorite 9 wealth building strategies. 

Thanks for visiting my website. Feel free to share this information on social media with anyone who may benefit from it or get family members on board with keeping your information safe online. Camille Gaines

Thanks to my Sources:






The information on this website is for education only and is not to be construed as personal financial advice.