Money management is a critical life skill that is necessary for being successful. Proactively planning and practicing self-discipline in your finances leads to financial security and even growth in one’s wealth. While you may think you have a good grasp of your financial knowledge, it can be troublesome to use that knowledge effectively. This applies particularly to high net worth and ultra-high net worth investors who have millions of dollars in liquid assets. Abundant wealth and assets can make money management complex and overwhelming. That is why you should hire money management advisors or financial advisors to help you. Our guide, designed for affluent investors with more than $10 million in liquid assets, talks about the best qualities to look for in a financial advisor.
Strategies For Families Worth $25 Million To $500 Million
The Art of Protecting Ultra-High Net Worth Portfolios and Estates
The insights you’ll discover from our published book will help you integrate a variety of wealth management tools with financial planning, providing guidance for your future security alongside complex financial strategies, so your human and financial capital will both flourish.
Clients frequently share with us how the knowledge gained from this book helped provide them tremendous clarity, shattering industry-pitched ideologies, while offering insight and direction in making such important financial decisions.
If you’re familiar with the basics of investing, financial management, retirement planning, and various insurance policies, money management may seem like a simple task for you. You may think you have it all covered by yourself. This might be true for the average businessman, but as a high net worth or ultra-high net worth individual, you should take more caution. Professional financial advice can make all the difference in your wealth. At Pillar Wealth Management, we provide money management services to affluent families with $5 million to $500 million in liquid assets. Schedule a consultation to start working with us.
Money Management vs. Financial Advice
Although very similar in their jobs, money managers and financial advisors differ slightly in their areas of specialization.
Financial advisors aim to understand your unique financial lives and specific future goals and objectives. They work to create a comprehensive financial plan to help you achieve the life you want.
Financial advisors can specialize in a wide variety of aspects, from investment management and retirement planning to estate planning and wealth transfer. There are many kinds of financial advisors based on their areas of expertise or certifications.
On the other hand, money managers focus on managing portfolio strategies that can bring you the greatest amount of success.
Who are Money Management Advisors?
Money management advisors look into the strategies that you should use to improve your portfolio performance. Some of these have been outlined in our Performance Guide.They strive to make sure your investment portfolio stays consistent with your investment objectives. Their area of expertise includes risk management and investing your assets to maximize capital growth. They work to evade needless turnover within the management team. Furthermore, they work with full transparency, keeping you in the loop and warning you about potential conflicts of interest.
Money Management Companies
Money management companies provide the service of monitoring and managing your assets and investment portfolio. They can cater to institutional investors or individual private clients. Their process entails conducting extensive research and identifying prosperous investment options for your profile. They do this by hiring several financial experts with a range of specialties in their respective fields.
Money management advisors keep track of your assets and carefully help you decide when to sell them. They advise you on which securities you should buy or sell to accomplish your long-term or short-term goals.
What Does a Money Management Advisor Do?
Asset allocation analysis is one of the services provided by money management companies. They create investment plans with strategies to help you balance risk and returns. Diversifying your assets among major categories can protect your portfolio against significant loss and let you earn higher portfolio returns. These categories can include real estate, bonds, stocks, cash, and commodities. If you want to learn more about this, we have compiled 5 critical shifts you can make to improve your portfolio performance.
Stock selection, monitoring existing investments, financial statement analysis, and portfolio strategy implementation are other services that a money manager can assist you with. Additionally, they identify, analyze, and mitigate risks associated with investment decisions. Several factors, such as inflation, market volatility, and political changes, can affect your capital returns. Money management advisors are well-versed in these aspects and can guide you appropriately. Securing your wealth is essential to maintain a healthy and sufficient financial future for your family. You can read more about this in our book, The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies for Families Worth $25 million to $500 million.
Who are Financial Advisors?
A financial advisor takes the time to learn about your financial life, i.e., your debt, cash inflow, monetary expenses, investments, savings, etc. They create a detailed investment plan, which is then reviewed and adjusted regularly. While their tasks include the aspect of money management, they provide a more holistic approach to your monetary needs.
There are multiple types of financial advisors available, and this may lead you to wonder,“How do I pick money management advisors for retirement planning, estate planning, or even portfolio management?” Knowing about the services that each of the following financial advisors provides can help you determine which one you should hire.
Investment Advisors and Brokers
As the name states, investment advisors and brokers focus on managing your investments. They suggest purchase and selling patterns based on your profile. They also help you create or revise your investment portfolio to match your future aspirations and values. Investment advisors typically have a fee-based payment structure, while brokers charge you through commissions.
Asset managers are aware of the performance of asset classes in the market. They can advise you on allocating and securing your assets by investing them in the appropriate categories. Like investment advisors, they manage your investment portfolio.
Certified financial planners (CFP) are crucial in financial management. They draft a comprehensive plan to help you manage your money and plan for your future. Their wide range of services includes tax planning, retirement income planning, estate planning, and even risk management. Since they abide by a fiducial standard of care and have extensive training, they can provide you with highly ethical, unbiased advice.
Wealth managers or wealth advisors are perhaps the most relevant for high net worth and ultra-high net worth investors because they cater only to affluent clients. Their range of services is very extensive, from retirement planning and debt consolidation to tax mitigation and estate planning. Their experience in working with large sums of wealth makes them more equipped to handle the risks and complications that come with it. Furthermore, they can understand and help you achieve your unique financial needs. Contact one of our expert wealth managers today!
You can seek inexpensive, online financial advice from the comfort of your home through robo-advisors. They use algorithms and mathematical rules to advise you on your financial plan and investment strategies. However, they cannot offer the level of personalization or customization that you get from other financial advisors.
Chartered Financial Consultants (ChFC) are fiduciary consultants who work with clients on a temporary basis to solve a specific financial issue. They do not overlook all of your finances but focus only on the task which you have hired them for.
Finding the Best Money Management Advisors for You
Deciding that you need to hire a money management advisor is only the first part of your journey to financial serenity. The next step is to do extensive research on who are the best money management advisors and how you can find them. The more invested you are in this process, the more it will benefit you in the long-run. After all, the advisor or firm you choose will have access to your entire personal financial life.
How Do I Find Money Management Advisors?
The simplest way to look for a money management advisor is to search through the internet. However, the overwhelming search results can leave you confused about where to begin. Therefore, it is best to begin by getting referrals from acquaintances or family members. It would be more beneficial if they have a similar financial background to yours.
Money management companies who cater to high net worth and ultra-high net worth clients usually have their credentials and accreditations easily available for you to view. Some may be listed on the industry’s databases, i.e., the CFP website or the Financial Planning Standards Board (FPSB). Other tools include The National Association of Personal Financial Advisors (NAPFA) and The Financial Planning Association.Doing a diligent background check can help you understand the firm’s reliability and credibility.
You can also begin by reading various blogs and articles about wealth management. Reputable money managers or financial advisors often write for their own or other major websites. This can help give you insight into their knowledge and understanding of handling high-value assets and large sums of money.
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