Preserving wealth is not an easy feat, especially in a world rife with financial uncertainties.

With a sensible strategy, though, the wealthy manage to hang on to their riches. Here are seven secrets behind how they do it.

1. Investing in dividend-yielding stocks

Many millionaires prefer investing in dividend-yielding stocks for passive income generation without actively managing these investments.

Companies like AT&T, Walgreens, Verizon and 3M pay over 6% in dividends for every share of stock owned.

By some estimates, it can take upwards of $300-400,000 to yield $1,000 of dividend income a month, but if somebody had millions invested into these stocks, it’s clear how the money can add up quickly.

2. Getting tax deductions from businesses.

Establishing businesses can lower tax liabilities with potential write-offs on initial losses and business expenses.

Entrepreneurs also have access to tax-deferred accounts such as solo 401(k)s that allow greater savings than traditional plans by contributing both as an employer and employee.

3. Investing in vacation homes is another strategy for protecting income.

Holding vacation properties offers another avenue of shielding cash from taxes according to Bryan Vance of Bucks & Cents.

Renting out your vacation home less than 14 days a year renders the rent virtually tax-free, while longer rentals permit deductions related to property maintenance costs among others.

4. Buy some municipal bonds.

Municipal bonds from the government help the rich legally avoid taxes, as earnings from these bonds are typically exempt from federal taxes.

Good news! People who make lower incomes can also invest.

However, for those considering it, it probably makes more sense to invest in a taxable bond with a higher return rate.

5. Using real estate to get tax deferments.

The elite exploit the 1031 Exchange rule when selling vacation homes and like-kind properties.

This rule allows them to defer capital gains taxes, thereby evading immediate tax obligations.

This rule can be implemented multiple times until gains are realized.

6. They get life insurance.

Well, specifically permanent cash-value types of life insurance such as whole and universal.

These offer a tax-free place to park funds, which can then be borrowed against the policy’s death benefit.

However, if you have outstanding debts and pass away, the insurance company will take what you owe out of your estate.

7. Offshore accounts help keep money hidden.

As much as 10% of global GDP is held in offshore tax havens like the Cayman Islands, Switzerland, and Singapore.

While staying within legal limits, such accounts allow the rich to evade large tax payments.

In conclusion, it seems the wealthy have a myriad of ways to keep their money safe.

These methods, under the current laws, are completely legal and might even help those with lower incomes keep their money safe as well.

Just make sure to do your research and consult a tax professional before entering into any investment plan.