What is wealth management?

What is

wealth management

and

do you need it?

Wealth management can be thought of as a comprehensive service focused on taking a holistic look at a client’s financial picture, including services such as investment management, financial planning, tax planning and estate planning.

Wealth management is generally considered a “high-end” type of service, and some wealth management firms may require a certain level of investment assets or a minimum net worth. For clients who need this level of service, it can be useful to consolidate all types of financial advice in one place with just one firm.

How to choose a wealth manager

When choosing a wealth manager to work with, you’ll want to look at several things.

First, does the wealth management firm work with clients like you? Some wealth managers may focus on clients of a certain type and if your situation doesn’t fit with that type of client then that particular wealth manager may not be a good fit for you.

Second, you’ll want to look at the manager’s qualifications. Some criteria you might use in selecting a wealth manager include:

  • What professional designations do they hold? Examples might include CFP (Certified Financial Planner), CPA (Certified Public Accountant), CFA (Chartered Financial Analyst).

  • What is their level of experience in the wealth management space?

  • What services does the firm offer?

  • How often do you expect to communicate with them?

  • What types of fees do they charge?

  • Are they independent or part of a larger firm?

Wealth management strategies

Wealth management strategies will vary based on the specific needs of the client. Overall, the reason to use a wealth management firm is to seek strategies to help maintain and grow your total wealth. This can mean different things to different people.

In general, wealth management entails coordinating all the moving parts of a client’s financial situation into a comprehensive wealth plan. This might include the client’s tax situation, investments and retirement planning.

Examples of wealth management strategies include:

  • Developing a comprehensive investment strategy covering all of the client’s various types of investment and retirement accounts.

  • Coordinating an optimal tax planning strategy into their wealth planning.

  • Ensuring that the client’s estate plans reflect their desires.

  • Developing a succession plan for business owner clients.

What Wealth Managers Do

Wealth managers provide holistic financial advice to help their clients grow and protect their wealth. This advice goes beyond just providing advice on a client’s investments or designing a financial plan for them.

Wealth managers generally work with clients with a higher net worth than a financial planner might. They often work with professionals in related areas such as tax professionals and attorneys to help design a comprehensive wealth-planning strategy for their clients.