Wealth management is an investment and financial management service for highly affluent clients. Wealth management involves financial counseling, accounting and tax services, retirement planning, estate planning and handling of legal situations. Wealth advisors help their clients formulate financial strategies and goals and implement a plan to reach those goals.
Wealth management is different from asset management or portfolio management as it is typically more inclusive and involves all aspects of the client’s current and future financial plans.
Wealth Management vs. Portfolio Management
Wealth management deals with all aspects of one’s financial situation. This includes managing client’s tax planning, retirement planning, estate tax planning and some accounting. Wealth advisors work hard to make their client’s life easier, while also maximizing their wealth and reducing the cost of taxes, lawyers, etc.
Portfolio management is less inclusive than wealth management. The main priority (and often the only priority) of portfolio management is to manage the client’s portfolio. They manage assets such as stocks, bonds and mutual funds. A portfolio manager will typically try and maximize revenue while keeping risk as low as possible.
Benefits Of Wealth Management Services
Wealth management advisors custom-tailor each plan to meet the client’s needs. However, there are certain general benefits that one can expect, which include:
- Comprehensive financial planning
- Reduces financial headache
- Assist with tough situations
- Personalized service
- Relationship building
Wealth management can help by creating attainable financial goals and helping clients meet their goals. Their service is personalized, and advisors must take time to know the individual client and their desires and needs, whereas portfolio management may not take more of a cookie-cutter approach without getting to know the client.
This is for informational purposes only and should not be construed as tax or legal advice. Please consult your tax or legal advisor.
Every client has unique goals for wealth management. Advisors help clients establish their goals. For many, the goals involve having a comfortable retirement. Goal setting could also include ensuring taxes are prepared legally and in the most financially advantageous manner possible. Many others have goals of maximizing their wealth through a sound investment strategy.
Early in the process, the wealth advisor will determine the client’s needs and preferences and tailor a financial strategy to implement long-term.
Retirement planning can ensure your retirement goes as planned and unexpected financial obstacles do not create a major concern. Wealth management advisors assist clients in retirement preparation by helping them allocate funds for after their professional career reaches its end.
People are living longer now than ever before, so having enough wealth allocated for several decades is essential. Whether you want to buy a home in a more expensive area, help family members financially with their endeavors or cross off expensive adventures from your bucket list, retirement preparation is a great way to ensure your plans for retirement become a reality.
Estate planning may also be included. This involves determining how one’s estate (wealth, assets, etc.) are divided after death. These decisions are often made with a lawyer, but a wealth management advisor can also be present and active during the estate planning process. Having a professional voice in the matter helps clients make more informed decisions about their estate.
Assistance During Significant Life Changes
There are many obstacles a client may face, especially if they hold an important role within their industry or have accrued a large amount of wealth. This can include unexpected lawsuits, company trouble or a change in one’s role within their profession.
Life changes can also include personal matters. For example, going through a divorce is most likely to have a financial impact on a client, and a wealth management advisor can help with the financial component of these difficult life changes. As discussed, retirement is also a significant life change that can be expected.
Guidance From A Wealth Management Advisor
Wealth management advisors take proactive measures to ensure their client is able to maximize their wealth. However, advisors also offer advice and guidance on all financial matters. This gives clients peace of mind to know that they are not in a position where they have to make difficult financial decisions alone.
Guidance from a wealth advisor can also lead to better financial choices. This is because they are professionals who spend their careers helping highly affluent clients make the most sound investment and financial decisions that minimize risk and maximize the potential for long-term financial stability.
Speak To Experienced Wealth Management Advisors
Contact our team today to learn more about what wealth management is and how it can help you plan towards the future and retirement. We pride ourselves in making clients’ life easier and ensuring their financial future is in good hands. When it comes to making difficult decisions, our clients are never alone. For more information give us a call at 703.782.5058 or request a consultation online.