Billionaires don’t need to hide their wealth to avoid taxes. But for the average Joe, it might be better to hide your fortunes than to flash and show before all. That’s essentially the definition of stealth wealth. Steal wealth means hiding your money instead of splashing on designer clothing and fancy cars. The practice of stealth wealth isn’t to avoid paying taxes, but for keeping your fortunes a secret.
But you might be asking yourself, why would you hide the fact that you have money? Well, it’s all about being under the radar. While that might seem like something out of Breaking Bad, frugal living does come with its benefits. In this short guide on stealth wealth, we’ll talk about the benefits of practicing stealth wealth.
Why Should You Hide Your Money?
Even though we gave a thorough and quite story-telling explanation about what stealth wealth is, it doesn’t answer the question of why you should be doing it. Billionaires and millionaires hide their wealth as a means to keep their business to themselves. Some do it as it isn’t in their nature to flash their fortunes. While a completely separate group of rich individuals do it as it presents an investment opportunity. Stealth wealth investing is a particularly niche type of investing that is more common than you might think.
It’s essentially the practice of hiding your investments in a bid to conceal your strategy. Since any avid investor would do anything they can to get their hands on a winning formula, telling everyone about your little secret won’t keep it a secret for long. But stealth wealth can also be a powerful tool for personal finance. Instead of spending outrageous sums of money, you live a middle-class lifestyle. This helps you save money, invest, and plan your financial future with little risk.
But if we look past stealth wealth as a means for the mega-rich to hide their fortunes, why does the average Joe do it? It is more common for billionaires and millionaires to be more interested in stealth wealth. But this guide isn’t interested in exposing their interests in stealth wealth. Instead, we will tell you how you, the average Joe, can benefit from this quite niche practice.
Benefits of Stealth Wealth
Some of the benefits that come with frugal living will positively shock you so much that you might even start doing it now. While people tend to be proud of their achievements, not everyone should know about your fortunes. So with all that said, here is why you should hide money instead of flashing it.
Stealth Wealth Is A Good Way To Spend Less
We mentioned at the beginning that stealth wealth can be an excellent tool for personal finance. But what does that mean? Personal finance can mean any number of things. In essence, it means sticking to a budget, saving, and achieving financial freedom. Stealth wealth can help you do that. Since you’re not flashing your money on Instagram, you’re spending a lot less of what you make.
Despite 86% of young people wanting the lifestyle of one of these influences, it’s not something you should do. Throwing money for Instagram fame is an excellent way to go broke. So the less you flash your cash, the bigger the chances of preserving your fortune. The more money you end up saving with each paycheck, the easier it is to achieve financial independence.
Since no one can predict what comes next in life, practicing stealth wealth prepares you for every financial emergency possible.
Stealth Wealth Is A Good Way To Avoid Loaning To People
We are taught always to help those in need. But sadly, not every person out there is worth helping. Let’s just say that people know you have money. If a friend is in financial need, they’ll likely contact you and ask to borrow some money. While it’s perfectly normal to help our closest friends through tough times, not every friend will payback. It’s just the rule of nature. Some people don’t solve their problems and end up in more debt. Maybe they have a serious addiction and they’ll use the money to fuel their addiction.
When that happens, friendships usually end. You’re not the reason why the friendship ended, they are. You gave what they asked but they won’t pay you back. That puts you in a very tricky situation. Do you continue asking for your money back and risk losing this so-called “friend, or do you back off and give the person more time?
It’s a conundrum that very few of us want to find ourselves in. One way to avoid these situations is through practicing stealth wealth. If your friends don’t know about your fortunes, chances are they won’t get offended when you tell them no. You won’t end up looking like a jerk and they’ll move on elsewhere.
Stealth Wealth Is A Good Way Of Knowing Who Your Real Friends Are
A problem that no doubt many millionaires and billionaires deal with regularly, money can bring the worst in people. If your friends know that you have money, do they even care about you? Are you 100% certain they’re not hanging out with you for your money? If they don’t know about your money, will they even be there?
You’re probably concluding that the benefits of stealth wealth have more to do with what people around you think about you than what the government thinks. But you’d be completely wrong about that. While stealth wealth does fend off unnecessary attention from people, it also fends off the prying eyes of the government.
Stealth Wealth Is A Good Way To Avoid the Government
Ultimately, the average Joe can practice stealth wealth for the same reasons rich people do – that’s the whole twist of this article. The less the government knows about you, the more you can go about doing your things. Instead of telling the government that you have all this fortune laying around, why not stay silent and look for clever ways to protect your assets?
While taxes are pretty much unavoidable, and the last thing you should be doing is avoiding your taxes, that doesn’t mean you should tell the IRS about every penny you earn. Instead of flashing your cash, why not put it to work? You could follow up on our guide on how to retire rich and happy.
Ultimately, everyone can hide money and benefit in many ways. From fending off the prying eyes of the government to avoiding people entirely, there is a purpose why people practice frugal living. While every person has their own reasons for hiding money, it should be something that everyone does it. Not everyone is interested in your lavish lifestyle, so consider practicing stealth wealth.