Many people have heard the term Wealth Management, but no one has truly stopped to think what this actually means. The word is thrown around boardrooms and in trades and it was peppered through financial articles about how to maximize your money and investments. Still no one thoroughly explained what wealth management really is. Is it simply managing my wealth? Do I make enough wealth for it to be managed? Why shouldn’t I just use an investment banker? Well the answer is a bit more nuanced.
Wealth management is different depending on the perspective. That is to say for the affluent individual wealth management is the science and process that is used to solve and increase his or her financial situation. This individual trusts a financial adviser to look at their situation and come up with a plan to manage it that will ultimately result in a better situation than the one that they started with.
From the financial advisor’s perspective wealth management looks different. It’s the ability to look at and understand a client’s financial situation. After understanding the situation, they utilize a full range of financial services and products to put together a plan that works to improve the finances of the affluent individual. From there they consult with the client to deliver their recommendations and plans. The process from the perspective of the financial advisor is consultative. The entire process revolves around the client. The objective is to understand the person they’re dealing with and find out the necessary information like what is important. After the wealth manager understands the client, they can then begin to make informed plans and recommendations. This involves bringing in the necessary experts and financial products to bring about the desired outcome.
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