What is Wealth Management & How Can it Benefit Your Financial Future?

About Wealth Management

Wealth management is a holistic approach to helping you make the most of your assets, liabilities and opportunities by creating long-term strategies that blend investment growth with personal goals.

Wealth management is a broad term encompassing all types of financial planning, with the goal of helping you manage your finances in a way that allows for comfortably meeting current needs while considering future ones.

A great wealth manager will help you identify and build your goals for the future, and help you find the best ways of realising them – without compromising on your lifestyle or robbing you of any enjoyment today to pay for good times tomorrow. Most importantly, a good wealth manager will also be someone you can trust and rely on, and who keeps your best interests at heart.

Think of a wealth manager like a personal trainer for your finances

A personal trainer takes time to understand your goals, your lifestyle, your motivation, your barriers to success and everything that comes together to form who you are and who you want to become.

People don’t just hire a personal trainer when they’re out of shape – they hire them when they want to capitalise on gains they’ve already made and take their health to the next level. A personal trainer helps you with your exercise regime, nutrition, lifestyle adjustments and mindset. They provide motivation when necessary, sets goals and monitor progress toward those goals. They know what exercises work best for different body types and can tailor your regime accordingly.

Now you’re sold on the personal trainer idea, remember your money has to see you through your whole life, just like your body. Why not give your finances the same treatment? A financial planner is a professional who will help get your finances into the best shape possible; they’ll help you figure out the best ways to invest and save for retirement to achieve the lifestyle you deserve – and unlike personal training, the process is virtually painless.

What types of Wealth Management are there?

Wealth management is an umbrella term covering a range of financial services. A financial adviser can help you manage your wealth in the following key areas:

• Financial planning;
• asset allocation;
• asset management;
• tax advice;
• retirement planning;
• and estate planning.

Let’s look at each one in a little more detail.

Financial planning

A subcategory of wealth management and another broad term with multiple facets. A financial planner will give you advice on how to achieve your long-term goals while also dealing with today’s financial realities, and how to mitigate factors like inflation.

Asset allocation

This involves a focus on building your investment strategy. A financial adviser will assess your financial goals, your politics and sensibilities, your appetite for risk and your current financial position. Using this intelligence, they’ll help craft a perfectly balanced investment portfolio that satisfies all your wants and needs.

Asset management

Simply, managing your money. This involves making investment decisions on your behalf, often utilsing a discretionary fund manager (DFM). A financial adviser will monitor the performance of your portfolio and make adjustments as needed. They’ll also help you rebalance it at least annually to ensure that it stays properly allocated based on your goals, risk tolerance and current account balances. Asset management can be a very broad term and can encompass everything from making sure your investments are properly allocated to making sure you’re not paying too much in fees.

Tax advice

Not the same as tax accounting – wealth management is more about the bigger picture than the nitty gritty of tax returns. Wealth management is as much about saving money as it is making it – and your financial adviser will be able to figure out how you can keep as much of your money for yourself as possible.

Retirement planning

The retirement planning aspect of wealth management is about making sure you have enough money to live on when you’re no longer earning an income. Retirement planning is more than just saving for retirement – it’s about making sure your assets are properly invested so that the money keeps working for you (even after YOU stop working).

Estate planning

As much as we don’t want to think about it, death is a natural part of life. And figuring out what happens to your hard-earned assets when your time comes is a necessary part of wealth management. Ensuring your loved ones or chosen beneficiaries inherit as much of your wealth as possible is the aim – and since it’s uncomfortable to consider one’s inevitable demise, often best to let your financial adviser take care of the details on your behalf.

Wealth management for ex-pats

Wealth management is a complex and highly personal process. That’s why it’s important to find a financial adviser who truly understands your needs – particularly one who can navigate the additional complexities of wealth management for expatriates. With a staggering 230 million ex-pats worldwide, the need for expert financial advice for people living, working, retiring and growing wealth overseas is ever-growing.

The right expat financial adviser will help you navigate the unique challenges associated with international wealth management, including:

• Exchange rate fluctuations and currency conversion rates
• Currency and market fluctuations that can impact your investment portfolio
• Tax implications when moving money across borders
• What happens if/when you want to return to your domicile?
• Specialist pensions transfers advice and arrangements

For expats, there is a slew of benefits when using international wealth management. When you choose a financial adviser with deep knowledge of international issues, you can ensure your hard-earned money continues to work hard for you – instead of being diminished by tax pitfalls.

As not only experienced International Financial Advisers, but also expats ourselves – it’s safe to say we know a thing or two about the complexities of international wealth management.

What are the benefits of Wealth Management?

The obvious benefit of accessing expert financial planning expertise is that you’ll grow the assets you need to unlock the life you want. Research by Vanguard showed that working with a wealth manager adds, on average, 3% per year in net returns.

A very important secondary benefit of using wealth management services is to relieve the burden and stress that comes with vital financial decision-making. Back to that health analogy – financial planning is a form of preventive medicine. It’s the best way to ensure that you’re not only doing everything possible to protect your assets from market fluctuations but also that you’re making decisions in line with your long-term goals and values.

If despite all the preventative measures, the unexpected happens, you want to be sure that you and/or your loved ones can still live the lifestyle you’re used to – or would like to get used to! By taking financial advice and putting your wealth in the hands of a wealth manager, you’ll have an ally in your corner whose guidance you can rely upon not only to help when the unexpected happens but to prepare for it beforehand.

You’ll eliminate the need for all the deep market research involved in making informed financial decisions. Your financial adviser will already have done the legwork on that – buying you the gift of time and peace of mind.

Who is Wealth Management for?

• High net worth individuals;
• people who have a strong financial future and want to maximise their earning potential;
• people who have not yet reached the pinnacle of wealth but who stand to make it big in life and want financial advice that will help them get there;
• those who could benefit from specialist advice;
• and people without the time, knowledge or inclination to research and make decisions on financial markets.

Depending on your financial situation, goals and comfort level with managing wealth yourself, using a wealth manager may or may not be the best option for you.

If you’re a finance whizz who’s clear on your goals and ability to choose the correct products and strategies, and you have the time and the inclination, then perhaps wealth management isn’t a necessity for you.

If you find yourself with questions, or doubts or feel you could benefit from advice and guidance when making decisions about your finances, then a wealth manager may be the right person to help.

Your current financial status also needn’t be a barrier to accessing wealth management services. Wealth management is both for people with current significant assets to manage as well as those with high earning potential and bright financial futures who want specialist advice and support to achieve their financial potential.

Whether you are looking to retire or to continue contributing to your investments and savings, you should not have to stress about what to do with your money, how the market is going or which companies to invest in. Financial advisors are experts in wealth management and asset growth, so you don’t have to be.

We’d far rather you get on with enjoying your wealth and let us do the worrying and hard work.

How Wealth Management works – And how to choose a Financial Adviser

Wealth managers will employ various tools to get your money working hard and into the best shape of its life. The first step will be a financial review, looking at your assets, income, attitude to risk and plans for the future – ensuring your investments match your goals and preferences is the most important aspect of financial management.

Another increasingly important aspect of wealth management is understanding how your financial decisions impact not only your personal finances but your community and the world. For example, a recent report from EY showed that 78% of wealth management clients now have goals related to sustainability.

Some of the wealthiest clients we’ve dealt with have placed maximum importance on environmental, social and governance issues – over and above investment performance. And the EY report also reflects this, showing that 46% of ultra-high-net-worth clients have put climate change at the top of their agenda.

Whilst purpose-driven investment is certainly a mainstream objective of many investors all across the world, we’re firm believers that financial management should be service-driven and personalised, rather than following overall trends or fashion.

Allocating your assets optimally comes down to investigating and thoroughly understanding your preferences and values – and whilst there are some financial advisers who specialise in prioritising certain ESG parameters, the true measure of a great financial adviser is how well they can listen to you and respond to your needs and individual circumstances.

Truly effective financial advice should be personalised, unbiased, non-judgemental and impartial

The whole point is that your FA should be working for YOU, in an unbiased and objective manner, so that you can be sure that your financial planning is tailored to your needs and preferences. If the adviser doesn’t understand the issues that are important to you, then they may miss something vital when allocating your assets.

Additionally, a successful relationship with your FA is all about communication. Your FA should explain your options in plain, no-nonsense language that cuts down on jargon and gives you the most important information:

• What do they think you should do and why?
• How much will it cost?
• How do their recommendations align with your preferences and principles?
• What can you stand to gain?
• What happens if it goes wrong?
• What happens if it goes right?

When is the best time to start getting Financial Advice?

The earlier you begin your wealth management journey, the more time you have and the higher your ultimate returns can be. However, it’s never too late to start saving, investing and growing your wealth for the future.

Personal finance management is crucial to anyone with a desire to gain more financial freedom. There are so many considerations, but you can begin by asking yourself what goals you have for your finances and work from there. Regardless, when it comes to when to start, there’s no time like the present.

Get your money working harder for you – and get us to do the hard work, so you don’t have to. Contact us today to make a start.