Who is the best wealth management firms? A crisis is a time when many of our preconceived notions get tested if not completely upended. What we think is a given suddenly becomes questionable. Wealth management is no different. The job of a wealth manager is to secure your standard of living and your financial future, something you work very hard for every single day of your life.
Fulfilling these responsibilities requires a practical thought process, good risk management, reasonable cost control, and a proactive (rather than reactive) attitude. Those wealth management firms who embed these qualities in their processes tend to come out relatively unscathed from a major crisis. Those who do not establish a process and rather follow a generic strategy end up suffering the most.
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In order to know which wealth management firms have best 10 year performance, which wealth management firms are recognized to be the best, what is wealth management and do you need it, we have prepared the following guide.
We will try and answer all these questions below, in what we consider to be the ultimate guide to find the best wealth manager. For those of you who have over $5 million and up to $500 million we recommend you download this guide.
What is wealth management and do you need it?
Wealth management is an advisory service that is availed by high-net-worth individuals. It covers a wide range of aspects of a person’s financial life.
These aspects can include estate planning, retirement planning, tax planning, investment management, legal and financial planning, risk management, insurance, and philanthropic planning. Wealth managers often have a minimum account size threshold that they adhere to.
Wealth management is a specific form of financial advisory. Simply put, it is the highest level of financial planning service. If you work with an established wealth management firm like Pillar Wealth Management LLC, then the big advantage is that you only deal with one wealth manager who specializes in helping families with $5 million to $500 million in liquid portfolios.
This characteristic is one of the primary differences between a generic financial advisor and a wealth manager.
The benefit of working with a trusted wealth management firm is that one entity handles all aspects of your financial life for you. And even if your wealth manager is not an expert in a particular area, then the right expert could be engaged by your wealth manager for a specific purpose. But, you will still deal with only one wealth manager.
Secondly, financial advisors tend to service accounts of all sizes. They may, therefore, not be ideally positioned to handle portfolios worth a few million dollars. High-net-worth accounts have their own nuances. Hence, their management requires someone who is experienced in dealing with large account sizes.
Another point worth noting is that some financial advisors are domain experts. Therefore, you may end up having to engage the services of multiple such experts to handle various aspects of your finances. Dealing with each one of them can be time-consuming. Besides, each of those advisors may not work in a coordinated manner.
Lastly, an important benefit of engaging a successful wealth management firm is that you get a custom plan which works for your situation. A personalized approach means that the wealth manager can tailor his/her efforts to fit your needs.
There is no cookie-cutter, one-formula-for-all strategy. You may be surprised to know how many “big name” advisory firms simply copy-paste the same financial plans for many of their clients. That is really surprising given the fact that each person’s financial situation is unique and different. Wealth management is one field where standardization does not work well for the client.
We hope that by now, you are starting to find answers to the questions “What is wealth management and do you need it?”
If you are someone who has a few million dollars to a few hundred million dollars in liquid investable assets, and if you need a single entity to craft and execute a financial plan that fulfills your dreams, your goals, and secures your lifestyle, then wealth management is for you.
If you do not yet have the kind of assets mentioned above, or if you are looking for services in specific areas of your financial life, and if the lowest cost (for such services) is a top priority, then perhaps meeting a financial advisor may be a better idea.
If you are still unsure, then read this complimentary book about wealth management and choosing the best advisor for investors with $10 million or more in liquid assets.
In order to answer the question “which wealth management firms have best 10 year performance”, we first need to know what exactly is “performance”.
The traditional way of thinking about performance is to calculate the average rate of annual return for a specific duration. If this rate, expressed as a percentage, is higher, then the interpretation is that the performance is better.
However, if you are engaging the services of a wealth management firm to attain what we call financial serenity, then performance has a somewhat different meaning. Financial serenity is achieved when you can confidently live the life that you desire. If your portfolio’s performance allows you to do so, then the investment can be considered to be successful.
Achieving financial serenity can be different things to different people. For someone, it could be owning two homes in two different parts of the country to be closer to family, plus a yacht to enjoy the Bahamas. For someone else, financial serenity could be to have a stable income without taking on too much risk.
The investment decisions and the performance of those investments are very different for both of these individuals.
Therefore, performance cannot be an arbitrary number (like IRR or rate of return). The performance has to be linked to tangible life goals. You now get an idea of how to identify the wealth management firms with the best 10 year performance. These are firms that help their clients feel financially secure, fulfill their life goals, and ultimately achieve financial serenity.
Best wealth management firms 2019
There are plenty of wealth management firms operating in the US. To be counted among the best, a firm has to be able to attract more clients with larger account sizes. Reputation, brand, and the array of wealth management services offered also distinguish the very best from the rest.
The most widely used metric for ranking the best wealth management firms 2019 is assets under management (AUM). Here, we would like to point out that while the size of the AUM may be important, it isn’t everything. In fact, we have experienced that, oftentimes, a big-name Wall Street firm may not be the right fit for every person. The following is a list of the best wealth management firms 2019:
BlackRock is the world’s largest asset manager with a staggering $7.4 trillion in AUM. It has over 30 years of experience in managing wealth for clients in multiple countries around the world. BlackRock is best known for its iShares Core exchange-traded funds.
It is, in fact, the largest ETF provider in the world. ETFs are passive investment instruments that track major stock indexes. Their low fee structure and reasonable investment performance allow them, as some would argue, to outperform many mutual funds with higher fees.
Pillar Wealth Management
Yes, we have no shame and believe that we can compete with the best of them. Pillar Wealth Management, LLC. is a fiduciary that works 100% on fees, and personalizes wealth management to the needs of its high and ultra-high net worth clientele. We work on a low-volume high-quality model and, in fact, are only accepting 17 new clients in 2020.
Pillar Wealth Management, LLC. offers services that cover the entire spectrum of a high-net-worth individual’s financial life. Our important achievements in fulfilling the financial goals of our clients make us confident that we deserve to be on this list. Even if this is our blog, we are not hesitating to throw our hat in the midst.
Want to learn more about what sets Pillar Wealth Management, LLC. apart from other investment companies? Download our guide: The Ultimate Guide to Choosing the Best Financial Advisor: For Investors With $5 Million to $500 Million in Liquid Assets today.
The Vanguard Group
Individuals who prefer a more hands-off approach tend to opt for Vanguard’s wealth management services. Vanguard is well-known for its mutual funds and ETFs. Their selection of funds, in our opinion, is great for basic financial planning that do-it-yourselfers can easily manage. Vanguard positions itself in a unique way.
It does not provide a wide array of services for high net worth individuals. Rather, it offers clients the opportunity to invest in different funds. The client’s money is mostly invested in the same manner, whether it is $10 million or just $100 per month.
The risk with this model of wealth management is that you are at the mercy of the fund manager for taxes! Those who desire a more holistic investment approach should, instead, engage a wealth management firm that provides tax assistance, estate planning, and other services targeted toward ultra-high net worth investors.
If you are looking to invest with a hedge fund, then Bridgewater is a good option. The company works with institutional clients and can work out well if you run a pension fund, endowment, or foundation.
Bridgewater offers three funds, namely the Pure Alpha, All Weather, and Pure Alpha Major Markets funds. Each of these funds follows a different investment strategy. However, hedge funds do charge a hefty fee and each of the above funds come with their own annual fee structures.
So, is the biggest wealth management firm the right choice?
To answer the question, “which investment companies are the best for me,” you have to first think about your current financial situation. As outlined above, every company has a unique positioning. Each one has different strengths and weaknesses. The goal should be to work with advisors who can fulfill your needs as well as the needs of your family.
If you have between $5 million and $500 million in liquid investable assets that you are looking to invest and you’re interested in finding an investment company to help manage your assets, consider working with the team at Pillar Wealth Management, LLC. Schedule your free consultation.
The ultimate guide to find the best wealth advisor
The ultimate guide to find the best wealth manager cannot be complete without information on how to actually find the ideal wealth manager for your needs.
The best way to find the right wealth manager for your needs is to speak to a few good ones. The process of screening these reputed wealth managers is something you can probably guess. It involves doing a bit of research online, finding a few reputed wealth managers, getting to know whether the offerings of those wealth managers are the right fit for your requirements, and reading reviews about their performance.
You should also look at the qualifications of each prospective wealth manager. Designations like CFA, CPA, etc. can help. You can also check the records and credentials of a wealth manager by approaching the Financial Industry Regulatory Authority (FINRA).
Once you have shortlisted a handful of promising wealth managers, the next step is to either meet with them in person or schedule a phone/video call. This direct interaction is really important because it gives you a chance to ask some important questions.
You can ask the wealth manager about their experience, their expertise, and their way of working. Make sure you also ask the wealth manager about your costs in case you work together. Costs can include things like capital gains tax, commissions, and fund specific costs (active vs passive).
We recommend that you read this book on improving portfolio performance for anyone who has $5 million to $500 million in investible assets. It will give you great insights into how to evaluate portfolio performance and ask the right questions about the topic.
Another great way to finding a trusted wealth manager is to speak with your network. Your friends, your business partners, your family members, and your circle of support may have worked with great wealth managers. They will give you an unbiased and genuine review as well.
Hutch Ashoo and Christopher Snyder are the expert founders of independent, fee-only, and fiduciary wealth management firm Pillar Wealth Management. If you would like to speak with them or simply ask any questions about how custom and trusted wealth management advice is offered to high-net-worth individuals with $5 million to $500 million in investible assets, then feel free to start a conversation.