Real estate has long been a cornerstone for building wealth. Yet for executives and high-income professionals, focusing only on property can leave your portfolio exposed. An integrated approach includes tax-aware strategies across several asset types that protect capital, support growth, and add flexibility when markets shift.
With 2026 approaching, it’s worth asking: Is your portfolio designed to manage both volatility and tax drag, or is it relying too heavily on one source of wealth?
Why Diversification Matters
Markets change, and tax laws change with them. Relying on a single asset class increases risk and limits opportunity. Thoughtful diversification smooths income, balances risk, and aligns your financial life with goals such as business continuity, philanthropy, and long-term wealth transfer.
Strategies to Explore Beyond Real Estate
Energy and Mineral Interests
Oil, gas, and mineral rights can create steady cash flow while offering potential tax deductions that offset ordinary income. These investments move differently than stocks or property, adding valuable diversification.
Alternative Assets
Private equity, metals, and specialty programs such as conservation or wildlife property funds can help reduce correlation with public markets. They may also carry unique tax characteristics that improve portfolio balance.
Qualified Retirement Plans and Roth Conversions
Maxing out qualified plans is only the starting point. Converting part of a retirement account to a Roth during lower-tax years can build a source of future tax-free income and strengthen your overall plan.
Captive Insurance Companies
For business owners, a captive structure allows you to self-insure against certain risks. Premiums may be deductible, and with proper guidance, captives can contribute to both risk management and long-term wealth planning.
Charitable Trusts
Pairing charitable giving with tax planning can enhance both. A Charitable Remainder Trust provides an immediate deduction, generates income for a set term, and supports causes that matter to you at the end of the trust’s life.
Cost Segregation Studies
If you own commercial property, a cost segregation study can accelerate depreciation, improving near-term cash flow and offsetting income from other investments.
Integration Creates Strength
These tools work best when they’re coordinated. A Roth conversion can coincide with a charitable contribution to manage your tax impact, or a cost segregation study can offset gains from an energy partnership. True diversification comes from combining strategies that support one another rather than working in isolation.
A well-rounded planning depends on collaboration. Your CPA, attorney, and financial advisor should share one framework that reflects your liquidity needs, family goals, and long-term vision.
Risks and Considerations
All investment and tax strategies involve risks and trade-offs:
Illiquidity: Many alternative investments, DSTs, and energy partnerships are long-term and lack easy exit options.
Lack of Control: Investors may not have direct control over operations, financing, or sale decisions within structured programs.
Market Risk: The value and income of underlying assets can fluctuate with economic and sector conditions.
Sponsor or Manager Risk: Performance depends on the experience and integrity of the firm managing the asset.
Loss of Principal: There is no guarantee of profit, and investors may lose some or all of their investment.
Complexity and Suitability: These strategies can be complex and are generally suitable only for accredited investors who understand the associated risks.
Tax Law Changes: Future legislative or regulatory changes may affect expected tax benefits.
Every strategy should be reviewed with a CPA, attorney, and financial professional to confirm it fits your objectives, liquidity needs, and tolerance for risk.
The Advantage
Clarity is as valuable as capital. Diversification paired with tax-aware planning gives every asset a clear role in protecting and building wealth. With the right mix of coordinated strategies, you can strengthen today’s prosperity and prepare for tomorrow’s opportunities.
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🤝 If you or someone you know needs guidance on tax-efficient investing, 1031 DST Group is ready to help. Get a free consultation or learn more at 1031dstgroup.com
Disclosure for All Articles:
Portions of the written content in this article were assisted by artificial intelligence (AI) technology tools and reviewed by 1031 DST Group for quality and compliance. This material is provided for educational and informational purposes only and is not intended as investment advice or a recommendation to buy or sell any security. A 1031 exchange may not be suitable for all investors and may involve risks, including the potential for loss of principal. Always consult with a qualified tax advisor or financial professional. Some investments such as Alternative investments and DSTs involve significant risks and may be illiquid, speculative, and suitable only for accredited investors*.
*Accredited investors are defined under SEC Rule 506 of Regulation D. Generally, an investor is deemed accredited if their net worth is greater than $1,000,000 exclusive of their primary residence and/or their annual income exceeds $200,000 for the current and past two years. Click here to learn more.
Ray DeWitt is a Registered Representative of Realta Equities, Inc. and an Investment Advisory Representative of Realta Investment Advisors, Inc. Investment Advisory Services are offered through Realta Investment Advisors Inc., an SEC registered investment advisor. Securities are offered through Realta Equities, Inc., Member FINRA/SIPC. Neither Realta Equities, Inc. nor Realta Investment Advisors Inc. is affiliated with C-Suite Network Or 1031 DST Group. Realta Wealth is the trade name for the Realta Wealth Companies. The Realta Wealth Companies are Realta Equities, Inc., Realta Investment Advisors, Inc., and Realta Insurance Services, which consist of several affiliated insurance agencies.
