Wealth Management - Guide for Beginners

When households accumulate an enormous amount of money, or even if they inherit it, they start thinking about how to manage that money. That is why they need to do wealth management.

Wealth management is offered by special financial institutions, and by commercial banks as well. This service is used by wealthy people. Wealth management is an advisory service, provided by professionals.

Wealth management is a comprehensive process, it is the enhancement of the financial condition of wealthy people. From the financial advisor’s perspective, it is the ability to provide an individual with a full pack of financial services. The wealth managers should be able to deliver any financial product possible for their clients. In order to get proper service, you will need to find a decent firm with high-level professional wealth advisors. Wealth management firms specialize in looking at people’s financial picture and analyzing it in order to provide appropriate services. Those services include investment making, financial planning, tax planning, and real estate planning as well.

Most of the clients have some pre-defined objectives that they look for while using the wealth manager’s service. Those objectives are:

Building strategies for achieving their financial goals
Increasing their wealth
Investment management
Planning estate

The wealth management firms offer a diversity of services for those people who need them. The purpose of this service is to help clients maximize their wealth, manage liabilities, create strategies to reach clients’ financial goals, etc.

The services are:

Providing legal services
Plan estate
Financial planning
Retirement planning
Tax planning
Insurance advising
Planning education
Mitigating risks

Some of the services might be provided by outer firms, such as legal services.

The wealth manager himself should be very knowledgeable in the financial field, he should also seek other experts such as accountants or lawyers, so that you do not have to look for them. The wealth managers are able to help you with taxes. They will teach you how to avoid, for example, estate taxes.

The wealth managers are using different strategies for different clients, as all of them have different kinds of assets and their goals are different as well. For example, some people prefer risky investments that should bring enormous profit, but some of them might prefer stable and low increases in their wealth and they prefer safer investments.

A good wealth manager should always consider the preferences of his client and act accordingly. He should also take into account changes in their interests and any changes in their lifestyle.

For example, if an individual used to invest in risky growth, but is about to retire, the wealth manager is most likely to advise him to choose a safer investment, so that he could be secure during his retirement.

However, there might be some criteria according to which, you should be able to choose a decent wealth manager for your assets to be managed. It is always good to choose a financial planner who is certified. Also, it is important how they get paid. If they get some bonuses for promoting some services they are more likely to make you buy them even if it is not necessary or the best option for you. That is why you should negotiate about those kinds of details before you start working with them. It is always best if you are the only one, who will be paying them for their services. This way, they will concentrate to offer you high-quality products which suit your financial goals.

Another piece of advice before hiring a wealth manager will be to speak to the existing clients, listen to their experience, and if their experience looks desirable to you, then you will use the service. You also might need to compare the services that different firms offer to each other. The more services a single company offers, the more desirable it would be for a client. The price is also important. Try to compare prices at the service. If it is fair and compatible with each other, then you might want to hire their manager as your financial planner.

If you are willing to use the wealth manager’s service, you need to own a big amount of money. For example, some wealth management firms require from 250000$ investments to 10$ million. Some require a yearly income of more than 350000$.

The more an individual owns, the more services he or she requires from wealth management firms. However, if you do not have that kind of money, there might be some substitute services that offer nearly the same services. That is for example financial advisors or investment advisors could be many affordable alternatives if you are looking to increase your assets.

Although the range of products and services might be much narrower compared to the ones that offer wealth managers, they still can provide you with high-quality services like financial planning, retirement and investment planning, advising about taxes, and so on.

However, you should consider if it is worth it for you to use such services. The costs should not exceed the benefits that you’ll get while using those services.

To sum up, we could say that the wealth management process is consultative with its character which is oriented toward meeting the needs and wants of the clients, by offering financial services that are appropriate and suitable for them. The wealth managers are doing a very good job consuming the time and energy of their clients. They are helping them to set and reach their goals, whether it is financial or legal goals. Despite the great advantage of using the services of a wealth management firm, it is still good to weigh the costs and benefits beforehand, as you might prefer fulfilling your goals by yourself.