Are you a middle-income earner with some valuable assets and some key goals for your future? If yes, you know that you are ready to start organizing your finances to better meet your goals and objectives. However, you may not be entirely sure where to start. This is where wealth management can help you.

Wealth Management Defined

We can define wealth management as the structured and continual process of proper and effective identification and management of your final resources. This allows you to better reach your specific financial as well as non-financial goals. It is worth noting that wealth management entails managing the various financial assets of high net worth individuals (HNWI) and families. This is done through careful guidance, counseling, and planning.

Did you know that the various aspects of strategic investing, tax planning, insurance planning, estate, and retirement planning could be overwhelming for wealthy individuals? This requires the expertise and knowledge of several different professionals experienced in various areas of personal finance, such as retirement planning.

You will be glad to know that the outcome of participating in an effective wealth management process is stability and peace of mind. This is because you will have answers to all your financial planning questions. Also, you will know that you have a prudent and effective action plan to help you track progress towards the achievement of your particular goals.

Keep in mind that among other things, the wealth management process may address some or all of the following areas:

  • Retirement Planning
  • Cash Flow Planning
  • Asset Protection
  • Income Protection
  • Investment Management Review
  • Debt Management
  • General Estate and Tax Planning

It is worth noting that through education, guidance, and the identification of risk exposures, professionals can also help you defend against risks, such as market risk, which may keep you from reaching your financial goals.

Companies that Offer Wealth Management Services

You should know that the range of companies and firms that provide wealth management services to individuals and families include:

  • Insurance companies
  • Brokerage firms
  • Investment consultants
  • Money management firms
  • Large banks
  • Multi-family offices

Asset Management vs. Wealth Management

Asset management usually involves a financial institution directing your securities and cash. Note that in most cases, these institutions, such as investment banks, vary between providing traditional and alternative financial products not available to most investors.

On the other hand, wealth management is more than merely investment advice. It is an all-encompassing and comprehensive approach to your financial life. While this can include advice and guidance on investments and finances, it also includes accounting and tax services, planning for retirement, as well as legal and estate planning.

Can You Benefit from Wealth Management?

Many people assume that wealth management is just for high-net-worth individuals and affluent families looking to make the most of their financial assets. There is no doubt that wealth managers usually help people with lots of money to manage investments and avoid risk.

However, keep in mind that this isn’t always the case. For example, if you are a small business owner, you can benefit significantly by working with a wealth management firm or consultant.

So, whether you are looking to find the capital to open up a new location for your business or create a financial strategy so that you can afford to send your kids to public school, a wealth management firm can help you.

Having a Financial Plan is Essential to Wealth Management

Did you know that wealth management usually starts with a suitable financial plan?  This is because a financial plan can help you figure out the goals and objectives that you are trying to attain with the wealth that you have. Also, note that it provides a clear action plan for how to make it happen.

It is no secret that no two individuals have the same financial goals. This is the reason you need an individually tailored financial plan to make them a reality. Wealth management advisors work with several different clients at various stages of life. So, regardless of where you are now or where you are want to be, your advisor will help you create a customized financial plan that will help you get there.

Wealth Management Strategies

In most cases, a professional wealth manager starts by devising a financial plan that will maintain and increase your wealth based on your financial goals, situation, and risk appetite.

After developing the original plan, your wealth manager will meet you regularly to update financial goals, review and rebalance your financial portfolio. They will also investigate whether you need additional services.

Now let’s look at a few of the popular strategies that wealth managers use.

Wealth Creation

Note that this wealth management strategy aims to build your wealth. Usually, this is the main goal for most early-to-mid-career affluent people. You should know that it may involve considerably higher investment risk levels (for higher financial returns).

Wealth Preservation

This wealth management strategy aims to make your wealth last over time. Note that by lowering risk, this wealth management strategy reduces the potential for the best rates of return, but it increases stability. As a result, this financial approach is usually ideal for retired or late-career individuals.

Wealth Optimization

This wealth management strategy aims to continue to build wealth, with perhaps more diversification and financial risk management. Note that it might involve giving yourself the liberty to enjoy the financial resources that you have worked hard to create.

Related Course: Online Professional Certificate in Wealth Management

Learn the components of client profiling, asset management techniques, estate, and tax planning, and examine solutions at a high level.

About The New York Institute of Finance

 The New York Institute of Finance (NYIF) is a global leader in professional training for financial services and related industries. NYIF courses cover everything from investment banking, asset pricing, insurance and market structure to financial modeling, treasury operations, and accounting. The New York Institute of Finance has a faculty of industry leaders and offers a range of program delivery options, including self-study, online courses, and in-person classes. Founded by the New York Stock Exchange in 1922, NYIF has trained over 250,000 professionals online and in-class, in over 120 countries.

See all of NYIF’s training and qualifications here.