Wealth Management Services

Banks, financial advisors and brokers offer wealth management services to affluent clients who require special service to manage sizable assets. Individuals and business owners who have accumulated or have begun to accumulate a certain amount of wealth sometimes prefer to hire a financial organization to help grow, maintain or protect investments and money. These affluent clients, often called upper retail clients, are primarily interested in long-term management. However, for these programs to work, customers must already have developed a significant portfolio. Some wealth management services will accept clients with assets over $500,000. Others require a minimum of one million dollars to qualify.

Most wealth management services offer financial planning programs and special services tailor-made to the needs of important clients, but these organizations also offer customers access to specialists in many forms of financial management. Professional brokers are right on hand to offer estate planning, helping customers transfer wealth and private businesses to the next generation. Brokers will also set up annuities, mutual funds, 401K programs as well as lead customers through the maze of investing assets in various stocks and bonds. Certified public accountants (CPAs) give income tax advice and help with filing annual taxes, making the most of available deductions. Attorneys provide legal resources and advice on the release of funds at retirement. Organizations also connect clients with financial counseling services to help each individual or business make the best the decision according to individual situations, including advice on philanthropic and political giving, obtaining insurance, managing cash flow in a family business or risk-taking. Some firms will even help investors secure high value investment items such as art, wine, or precious metals.

Some ultra high-worth clients prefer to use family offices instead of larger corporations for their wealth management services. Family offices are privately owned firms and typically offer a complete realm of expertise to their clients. By utilizing consultants, databases and other analysis tools, these firms are more focused on the needs of wealthy individuals than massive corporations can be. Family offices come in two forms: single-family and multi-family firms. Single-family offices focus on one wealthy family. While multi-family offices have multiple clients, they normally do not accept as many customers as programs offered in a larger corporation. There are only about 3,500 family offices in the United States.

Regardless of where a client chooses to hire wealth management services, the process is typically the same. Professionals take time to get to know the client, family business, personal issues and assets. In the review, many things are taken into consideration. Customers must determine financial expectations, consider a time line toward retirement, and decide upon a level of risk that is comfortable yet yields the return they hope to achieve. Consultants will work together to establish as asset allocation plan using investment methods appropriate to meet the client's specific needs and situation. This detailed and comprehensive plan will provide the road map to the client's financial future. Professionals will establish investment accounts to maximize a client's wealth and utilize tax benefits legally for retirement. They will continue to manage the portfolio on an ongoing basis, changing it as the client's situation and risk tolerance level changes.

Jesus taught his disciples the benefit of managing money effectively. He told the story of a man who left his finances in the care of three servants. Since there were no wealth management services in existence during that era, the three servants were on their own. "Then he that had received the five talents went and traded with the same, and made them other five talents." (Matthew 25:16) In Jesus' era, a talent was worth twenty years savings. This servant doubled his boss' money and was rewarded for it. People who have amassed significant funds want to do the same with their savings. It does little good to hide money under a mattress when it can grow and thrive in investments, mutual funds or high yield retirement accounts. Of course, doubling finances is not always possible, some people do make solid financial decisions that can double, triple and even quadruple what they have earned if managed properly.

Wealth management services soared in popularity during the 1990s. Banks, insurance companies and brokers began offering these programs for individuals who became wealthy quickly and needed to hire an outside organization to manage it for them, freeing up time to pursue other personal and business-related issues. At the same time, as baby boomers aged, many of them needed help to financially prepare for retirement, which was quickly approaching. Around the world, the upper class was growing in number - especially in emerging economies - increasing a demand for such specialized services. In 1999, the Glass Steagall Act enable banking, insurance and brokerage services to be handled under one office, increasing the number of firms focusing on wealth management and enabling them to become more profitable.

Although many people confuse wealth management services with private banking, the two are not interchangeable. Wealth management programs help clients establish and manage portfolios that are profitable for individual goals. Individuals and business owners who already have their wealth being managed may eventually move towards private banking which will consolidate management programs under one firm. Although growing wealth can be an exciting endeavor, it is an incredible responsibility. Hiring a firm to help can help individuals and business owners become better stewards of the gifts God has given them.

Add to: File Insurance Business article Teen Photo Images