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Wednesday, Feb 21, 2024

Trusted Advisor: Growing and Preserving Your Wealth in Times of Uncertainty

AYLA KALANI
PACIFIC CENTRAL COAST MARKET TEAM LEAD
(805) 857-7631
AYLA.KALANI@JPMORGAN.COM
PRIVATEBANK.JPMORGAN.COM

In 2018, J.P. Morgan Private Bank opened our first Private Bank office in Westlake Village serving the needs of the ultra-high net worth in the San Fernando Valley and Central Coast. With a dynamic and experienced team of 17 bankers and support team members, we have brought the firm’s global resources to the local community and will be moving into a new office later this year. Westlake Village is not only home to many well-established families with generational wealth, but also to emerging businesses who are creating jobs and increasing opportunities across industries like biotechnology, agriculture, milling, real estate, and technology. Recently, our community has led meaningful initiatives in the philanthropic giving and impact investing space, bringing these areas to the forefront of what we do at the Westlake Village Private Bank.

While we are facing economic uncertainty, our team is well equipped to guide our clients through the year ahead. It’s also important to keep in mind that the largest and systematically important banks are more regulated, tend to have diversified deposits, maintain fortress balance sheets, and as a result, are much better capitalized.

As we head into the second quarter of the year, it’s a great time to evaluate your tax outcome for 2022 as well as overall spending, investing, and giving efforts across your balance sheet. This can be helpful to solidify your financials goals for the year ahead. The past year brought on unprecedented market volatility, negatively impacting both stocks and bonds for the first time in decades. With fears of rising inflation, the Fed’s aggressive tightening policy, and a looming recession, our role in advising our clients and their financial lives only grew. We like to make sure our clients see that volatility can also create opportunity, and this year, while we expect slow economic growth, we also see ways that clients can enter the market at an opportune time. In fact, our 2023 Long Term Capital Market Assumptions have found that now is the most attractive entry point for investors with a forecasted annual return for a USD 60/40 stock-bond portfolio over the next 10–15 years leaping from 4.30% last year to 7.20% this year.

Here are a few steps you can consider to grow and preserve your wealth.

1. ASSET LOCATION BEFORE ASSET ALLOCATION.

Typically, the four ways that families spend their wealth include: their lifestyle, gifting to family and friends, philanthropic giving, or tax payments. With economic uncertainties and legislation changes ahead, it is crucial for families to take the time to review their existing estate plan to ensure it continues to address the family’s wishes and preserves their legacy for generations to come.

2. REVIEW YOUR LIFE INSURANCE POLICIES.

Are your existing policies still supporting your goals? For example, wealth transfer planning can be a great place to start. Do changes need to be made to accommodate recent changes in your life and business? Is the right person holding the policy, and how did last year’s volatility impact the cash value?

3. ADOPT A TAX EFFICIENT STRATEGY IN YOUR PORTFOLIOS.

Review your accounts to ensure that your assets are held in the appropriate account. For example, consider holding income earning assets in tax-advantaged accounts, and assets that allow you to harvest tax losses in taxable accounts. Be sure to pay close attention to the Wash-Sale Rule, especially if you hold assets at different institutions.

4. PROTECT YOUR FAMILY AND VALUES.

Philanthropy can be a thoughtful way to educate next gen about wealth planning and legacy preservation. It also provides a unique opportunity for families to share and articulate their values. Reevaluate your prior year’s charitable giving, and consider your values, impact and tax expectations to plan for gifting in the new year.

5. SAFEGUARD YOUR ASSETS.

Understanding cybersecurity risks and implementing the right controls around your assets, accounts, and online activity, can protect you and your family against financial fraud and identity theft. Enabling account alerts, adopting longer and more complex passwords, and verbally confirming large transaction details with payors and payees are some of the key steps we encourage clients to take towards securing their wealth and legacy.

Taking these actions now can help you best maximize your wealth while staying
on track to meet your financial goals.


Ayla Kalani is an executive director and market team lead at J.P. Morgan Private Bank, serving clients in the Westlake Village and Santa Barbara communities.

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