October 28, 2021

What’s Changed in 13 Years of Writing About the Wealthy

People are now more open to talking about wealth, he said, asking questions like: “How did you make that trade-off? How much did it cost?”

And investors realized that they needed a plan to protect what they’d earned, whether they were a tech billionaire or a tech worker.

“When times were good, it can seem like they’re always going to be good,” said Sharon Klein, president of family wealth for the Eastern United States at Wilmington Trust. “Sometimes you don’t understand that until you have a really disruptive event like we had in 2008. A lot of people learned that you need to be really coordinated and have a team so you can pivot and change on a dime.”

She added that more of her clients today “are poised to take advantage of opportunity but also be defensively positioned if something happens.”

The perceptions of wealth as it relates to taxes and investing have also changed. Now, many more people believe that the wealthy have advantages over everyone else, and even the accountants and lawyers who service the wealthy accept some of that criticism. Take, for example, the report in ProPublica in June that Peter Thiel, the tech entrepreneur, has $5 billion in a Roth I.R.A., on which he will pay no taxes when he withdraws the money. Individual retirement accounts were created by Congress to help the middle class save for retirement.

“I’m convinced that changes to planning tools are in the cards,” said John Dadakis, a partner at the law firm Fox Rothschild. “Look at the Roth I.R.A. and what happened there. It’s great for some people, but the concept of creating a $1 billion Roth I.R.A. or even a $100 million Roth I.R.A. where you don’t have to pay any taxes is clearly the wrong result.”

Richard A. Behrendt, a former inspector for the Internal Revenue Service who then worked for a decade helping people hold down their tax bills, said that when he was at the I.R.S., “one of the biggest takeaways for me was the mechanizations that very well-meaning people in the law and accounting world would undergo for their clients.”

Article source: https://www.nytimes.com/2021/10/08/your-money/wealth-matters-lessons-learned.html

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