Six Wealth Protection Hacks The Rich Use That Middle Class Misses

A chartered accountant has shared some simple rules that allow the rich to stay rich while the middle class risks losing everything. CA Nitin Kaushik took to social media platform X to explain that it's not luck that allows rich people to protect their wealth, it is a structure used by them.

In his post, Kaushik explained that the middle class keeps everything in one place. “Salary goes into a personal account. Savings stay in the same account. Business income too. One financial shock and their entire life savings are at risk,” he said.

He explained that the rich manage their wealth differently, outlining six key ways in which the rich re-structure their earnings.

The first point outlined by Kaushik was about ownership and controlling the assets.

“They separate ownership from control. Your house is in your name and if you default, the bank can take it. Their house is in a trust or company….creditors can’t touch it. Same asset. Different outcome,” he highlighted.

According to Kaushik, private trusts are an "invisibility" shield for wealth protection.

“Settlor (you) creates a trust with family as beneficiaries. Assets (shares, property, investments) are transferred to trust. The trustee manages them. You can still control as trustee, but legally, you don’t “own” it anymore. If your business fails….creditors can’t seize trust assets,” he noted.

The CA explained that the rich people also take the advantage of holding companies for their asset management.

“Big businesses rarely sit in the promoter’s name. You see “ABC Retail.” But legally, it’s owned by “ABC Industries.” Sometimes, even multiple layers. If Retail goes bust → the family wealth in Industries remains intact,” he explained.

While middle class people borrow by taking personal loans and credit cards, the rich borrow through companies, the CA said further.

“Rich: their companies borrow. If default happens, the company is sued, not the owner. Unless they give a personal guarantee, their house remains safe,” he wrote.

Kaushik also explained that the rich take advantage of legal structures such as insurance and focus on asset allocation.

“They spread ownership across spouses, companies, and trusts. Even luxury homes are not in their name,” he said, citing the example of Mukesh Ambani’s Antilia.

According to Kaushik, the real inequality isn’t just income, it’s knowledge. While the middle class focuses on how to earn more, the rich focus on how to protect what they already have, he concluded his post.