When it comes to money, the ultra-wealthy don’t just make it — they know how to keep it. And while most of us focus on earning more, they’re quietly sidestepping financial slip-ups that can drain fortunes faster than a bad investment.
The good news? You don’t need a yacht or a private island to learn from their playbook.
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Here are the common banking mistakes the ultra-wealthy know to avoid — and how steering clear of them can help you protect and grow your own money.
They Think of Banks as Partners, Not Just Service Providers
According to Bhavin Swadas, CEO of Squeal My Deal, a considerable contrast between the hyper-wealthy and the typical customer pertains to mindset.
“Affluent entrepreneurs do not see banks as a financial platform to deposit money — they regard them as strategic partners,” Swadas added.
This implies that they go in search of banks in which they can get relationship benefits, and not necessarily convenience. They will then tend to concentrate funds on different accounts to gain a higher level of relationship, enjoy private banking services, zero fees and better interest rates.
This is the point, said Swadas: They realize that volume and loyalty equate leverage.
“On that leverage, they secure more favorable rates — lower or no maintenance charges, free wires, increased ATM withdrawal, and special credit lines.”
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They Avoid Transaction-Based Pitfalls
Rich people ensure that they do not initiate transactions that attract unneeded transaction fees.
“These are the overdraft fee, the foreign transaction fee, and the wire transfer,” said Swadas.
They have international accounts with no fees charged or use tanks to have a banking service with these bundled in for free.
The existence of multiple checking accounts in various currencies or jurisdictions is also common, said Swadas, especially among people who travel or invest in a foreign land, which saves them from currency conversion and foreign ATM fees.
They Maintain Buffer Accounts for Liquidity
Rather than having a single account used to act as a catch-all, Swadas said the very rich tend to set up their finances in a variety of accounts that are more specialized.
For example, they maintain an active checking account with an overdraft protection, a high-yield savings account with slow growth, and cash management accounts that are linked to investments and allow one to withdraw money without penalty.
“This system eliminates errors in transactions, bounced checks or surprise fees,” according to Swadas.
They Use Private Bankers and Relationship Managers
Swadas also noted that the ultra-affluent usually do not have to wade through the policies of banks.
These institutions usually set up managers to exclusively handle relations with the ultra-affluent who check their accounts, update their clients on any changes in the policies and proactively eliminate or overturn charges.
“These bankers can really assist in this lifestyle structuring of their accounts, as well; for example, how to make large or frequent transfers without causing red flags or compliance holds,” Swadas noted.
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This article originally appeared on GOBankingRates.com: 4 Common Banking Mistakes the Ultra-Wealthy Know To Avoid
