For perfectly logical reasons, an entrepreneur’s personal wealth is typically concentrated in a single asset: his or her company. Business owners tend to devote themselves to assessing and taking risks in order to grow their enterprises. But too often they don’t apply that same sharp focus to their personal assets. In fact, some of the attributes that make for a successful entrepreneur can be diametrically opposed to the imperatives of wealth preservation.

Like most investors, entrepreneurs should begin by considering their personal wealth objectives rather than simply reviewing specific investments and asset classes. However, many business owners may want to take an even more disciplined approach to portfolio construction than other types of investors. This is partly because they may have more to lose, but also because many of the elements of a solid financial strategy—such as understanding your investment tendencies, diversifying your portfolio and regularly reviewing your approach—can require additional care when there are significant assets tied up in a business endeavor. It’s important for entrepreneurs to ensure that their portfolio is tailored not only to their particular circumstances and comfort level with risk but also to the type of business they own.

Understanding your investment personality. Getting a better handle on your financial tendencies can help you invest in a way that’s better aligned with your goals. (For more information, read “Understanding the Investor in You.”) You may consider yourself a risk taker generally, but risk taking in an investment context isn’t the same as it is in business. When you invest cash in your company, your decision is based on careful analysis of a market you know well. “But financial decision making in your portfolio, how it behaves after you’ve allocated the money—that’s in the market’s control,” says Anil Suri, managing director and head of investment analytics at Bank of America Merrill Lynch.

An investment strategy that’s better aligned with your investment personality may help you stay invested when the markets zigzag. One way to help address the issue is to engage in an exercise akin to stress-testing a portfolio against a range of possible scenarios—such as the 2008 financial crisis or the dot-com implosion of a decade ago. The process serves to press home to investors how ugly market downturns can get. This, in turn, may help mitigate the instinct to sell. By somewhat preparing investors for potential market turbulence, stress tests can help guard against counterproductive behavior, such as selling out of fear, which can reduce long-term returns.

Prioritizing your goals. Once you have a better idea of yourself as an investor, you can begin to articulate your needs and what you’re trying to achieve. What are your short- and long-term financial and life goals? When do you anticipate retiring, selling your company or turning it over for someone else to run? What minimum amount do you want to ensure you have available for retirement, regardless of your company’s future success?

Be sure to consider your personal goals separately from your business objectives. Business owners often reinvest substantial sums in their companies. But if you plan to pay for your children’s college education, for instance, and you know what it will take to reach that goal, you can more consciously siphon off cash from your monthly income to allocate to a tax-advantaged college savings program, such as a 529 plan.

Creating an investment strategy. Once you’ve articulated and prioritized your goals, you can devise a strategy that takes into account who you are as an investor. The process often starts with a bit of mental accounting. Conceive of your wealth in terms of two distinct buckets. The first bucket is your entrepreneurial capital—your stake in your businesses. The second is a diversified portfolio that includes assets designed to compensate for the risk inherent in your businesses. For example, a technology executive may own a variety of assets, such as real estate and the stocks of a half-dozen large, publicly traded companies. But if the real estate holdings are limited to a pair of office buildings in Silicon Valley and the stocks are in other technology firms, a tech slump could depress the value of everything that entrepreneur owns.

It’s also important to make sure your portfolio contains enough liquidity to serve as a cushion against recessions, industry down cycles or any rough business patch. Indeed, because that first entrepreneurial bucket is likely highly illiquid (given that it’s tied up in your company), business owners may want to build as much as twice the liquidity into their personal portfolios as non-business-owner investors. Suitable liquid assets generally include a combination of cash, intermediate-term bonds and a line of credit that serves as a form of insurance against potential business pitfalls.

It’s almost always a good idea to apply for a line of credit before you need it. A credit line can give you the ability to take advantage of opportunities that crop up suddenly. During market downturns, for example, it can be used to finance the acquisition of businesses assets—a competitor, say—at bargain prices. Lastly, business owners shouldn’t overlook disability insurance. An inability to work could end up reducing not only your family’s income but also the value of your business.

Choosing a retirement plan that serves your goals. Some tax-qualified plans offer noteworthy benefits for business owners, allowing you to put away considerable sums while also helping retain employees via profit sharing. If your business has generally 100 or fewer employees, a SIMPLE (savings incentive match plan for employees) IRA is a relatively inexpensive option, offering most of the benefits of a 401(k) while imposing fewer IRS reporting requirements. Because participation is voluntary, employees can choose whether and how much of their pre-tax wages to contribute. Employers then match up to 3% of annual compensation, which they can deduct as a business expense. Or they can choose to contribute a flat 2% of compensation for all employees, regardless of whether they contribute. In either case, owners have an opportunity to reduce their companies’ tax burdens and put away money for themselves.

Reviewing and updating your strategies. Be prepared to connect with your Merrill Lynch Financial Advisor regularly—at least a few times a year—to go over how you’re making progress toward your goals. As business conditions change and life goals evolve, entrepreneurs in particular may need to modify their portfolios from time to time—tweaking asset allocations or selling certain investments—in order to stay on course. “The purpose of the review is to track progress relative to your goals, not just relative to the market,” Suri notes. Even when the market is volatile or the growth of your business is sluggish, “you could still be making steady progress toward your goals because of the way you’re invested.”

For entrepreneurs especially, a disciplined, diversified wealth management strategy makes perfect sense.

While there are a number of things that business owners specifically have to keep in mind when they’re crafting a personal financial strategy, in the end, a lot of these aforementioned steps are ideas all investors should consider. But for an entrepreneur, maybe the most important impetus for having a disciplined, diversified wealth management strategy in place is a very simple one. It can help protect your assets by letting you do what you do best: take smart risks.