For those with money, now is not the time for conspicuous consumption
During recent trips to London and New York City, I noticed that usually crowded high-end restaurants are now half-empty LINK. It is not only the absence of vanquished “Masters of the Universe” that is causing this phenomena. The remaining wealthy who used to want to be out at the trendiest hotspots to “see and be seen” are now much more shy about displaying their wealth. And for good reason.
Ostentatious behavior can make one an excellent target for eager tax authorities, divorcing spouses and hungry fellow citizens who are desperately looking for the few remaining deep pockets LINK.
Already the Inland Revenue in the UK has formed a special unit to target “fat cats and celebs” LINK.
Prudent UHNWIs are increasingly taking steps to protect their remaining wealth. Home security systems may work fine for keeping out home invaders LINK but they will not stop tax authorities or divorce petitions, no matter how unjustified their claims may seem. The smart ones are busy putting into place possible future exit strategies of foreign citizenships and residence to protect them should the “legal” muggers start to get too close. Given the speed and enthusiasm of legislators for increasing tax rates and for divorce lawyers to draft divorce petitions, time is of the essence to start to put together these plans. Even with all due speed and diligence they require months to properly construct.
As one recent client from California said to me, “My financial house is not on fire yet, but I can smell smoke coming down the canyon. I am not waiting to hear sirens before I get fire insurance and make sure my suitcase is in the car and gas is in the tank.”
David S. Lesperance, Barrister and Solicitor
Tags: Billionaire, Economic Crisis, Economy, Government, Immigration, Law, Legal, Millionaire, Passport Portfolio, Residency, Security, Tax, Wealthy
March 1st, 2009 at 3:02 pm
I love your comment about people with money are not going out as much, not because they can’t but because they can and don’t want to be so obvious.
Wonderful insight!
The question remains; How do those who truly have something to offer these people get to them?
In my opinion, the great opportunity that lies ahead of us all during this economic wake up period is to turn away from the doom and gloom and to explore without hesitation creative ways to continue productivity. Those who embrace that idea will not only find the wealthy but will become their biggest ally. In return success will follow for all involved regardless of the economic climate.
March 2nd, 2009 at 3:38 am
It’s going to get so much worse. With governments spending taxpayer’s money like drunken sailors on their misguided bailout schemes, those tax payers will have to pay more.
All taxation is theft, by government, and the scale of that theft has to increase in order to pay for their profligacy. They steal off savers by reducing interest rates to zero, then there’s the question of a devaluation of the currency – but ’soaking the rich’ remains the theft of choice by ‘democratic’ governments.