The Complete Guide to What We Do
Wealth management refers to financial advisory services catering to affluent individuals and families. How affluent? A high net worth individual is defined as someone with $1 million or more in liquid assets. Liquid assets do not include your house or other illiquid investments. An ultra-high net worth individual is someone who has $30 million or more in investible liquid assets. Citi® Personal Wealth Management offers services to such high net worth and ultra-high net worth individuals.
Citi® Personal Wealth Management is the wealth management business of Citi® group Inc. Citi® group is the well-known Wall Street financial institution that also does investment banking, retail banking, and a range of other financial businesses. Citi® group is the third-largest banking institution in the world. The current Citi® group business is a result of a 1998 merger between Citi® corp and Travelers Group. At the time, it was the world’s largest financial services organization. Clearly, Citi® group is known for its scale and presence. If you are someone with $10 million or more in liquid assets, then check this guide on choosing the best financial advisor.
There are also boutique firms like Pillar Wealth Management that focus only on wealth management and cater to individuals and families with $5 million to $500 million in liquid investible assets. Selecting a wealth management firm to work with should be a careful decision. After all, you will likely work with that firm for a few years or even decades. A significant amount of money will also be at stake.
In this guide, we will discuss Citi® Personal Wealth Management background. We will look at services offered by Citi® Personal Wealth Management. We will also touch upon the important topic of Citi® Personal Wealth Management investment philosophy. And finally, we will offer sometips for choosing a top financial planner.
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Citi® Personal Wealth Management Background
Citi® Personal Wealth Management background is quite long. It has been in the financial advisory business for a long time. Today, the firm has 3400 financial advisors and an extensive network of professionals spread throughout the world. The business is headquartered in New York City. Citi® Personal Wealth has minimum account sizes depending on the service that you seek. Its private banking clients generally require half a million dollars while the Citi® Markets Strategies option requires $2 million. There is a multi-asset class solutions program that can require anywhere from $100,000 to $25 million. Pillar Wealth Management has a simpler structure. It offers all its wealth management services to clients who have $5 million to $500 million in liquid assets.
When looking at the background of a wealth management firm (or Citi® Personal Wealth Management), check the background of the wealth manager that you would be working with. You can begin by checking the educational qualifications and what school/college a wealth manager went to. Next, you can check how many years of experience the wealth manager has and how he/she ended up in wealth management at the firm that you are speaking to. Besides career progression, you can also ask about any organizations that the wealth manager is a member of or any professional designations that he/she holds. Feel free to call Pillar Wealth Management to know the background of its two co-founders.
It is also a good idea to meet (virtually or in-person) the wealth manager one-on-one before deciding to engage a specific wealth management firm. This will give you an opportunity to ask questions and also understand the personality of the wealth manager. We recommend you download this guide on choosing the best financial advisor for individuals with $5 million to $500 million in liquid assets.
Services Offered by Citi® Personal Wealth Management
The services offered by Citi® Personal Wealth Management are quite extensive. They cover areas like estate planning, retirement planning, investment management, financial planning, and education planning. Many Wall Street firms offer a host of wealth management services. However, a boutique firm can provide all such wealth management services in a highly personalized manner. Because the niche firms are not positioned towards high volumes, they can go in-depth with each client portfolio and literally handhold their clients. So, when you go about evaluating the services offered by a wealth management firm, you should also factor in the way in which those services are delivered.
A firm like Pillar Wealth Management can also offer you advice on philanthropy and legacy planning. The famous investor Warren Buffett once said that giving away money can be more difficult than earning money. That is certainly true if you have had any experience with philanthropy. You can read all about wealth management services in this book called The Ultimate Guide to Choosing the Best Financial Advisor: For Investors With $5 Million to $500 Million in Liquid Assets.
The benefit of working with a wealth manager is not just the fact that you get a host of services in multiple areas of personal finance. It is also the fact that you can speak to one person who will deal with all aspects of your finances. Therefore, no matter what firm you decide to work with, you should check if you will be working with a dedicated wealth manager or not. This person is someone who you can speak to whenever you need to discuss anything about your finances. One person handling everything will also ensure that the decisions are holistic. Schedule a free conversation with Hutch Ashoo to know more.
Citi® Personal Wealth Management Investment Philosophy
A wealth manager’s investment philosophy deeply influences the way he/she crafts an investment strategy for your portfolio. Citi® Personal Wealth Management investment philosophytends to revolve around the client’s financial situation. Things like client goals, income, expenses, liabilities, tax expenses, and other attributes shape the investment strategy.
Whether you work with Citi® Personal Wealth Management or any other reputed firm, the client will be at the center of all investment decisions. However, Pillar Wealth Management has an additional focus as far as its investment philosophy is concerned. Pillar not only connects client objectives to its investment decisions, but it also places special emphasis on investment costs. You can read in detail about how investment costs eat into client returns in this guide on improving portfolio performance for investors with $5 million to $500 million in liquid assets.
Investment costs mean expense ratios, brokerage fees, transaction costs, and capital gains taxes. A portfolio manager can trade frequently in an attempt to beat the market. If he/she does, then you end up paying a higher rate of short-term capital gains taxes rather than a lower rate of long-term capital gains taxes. Therefore, the out performance of the frequent trading manager better be vastly superior to cover the additional tax outgo.
Another wealth manager may invest in a passive index fund with a low expense ratio for a much longer duration and earn an average return but with much lower expenses. Ultimately, the net returns after deducting all such expenses are what matter. Feel free to get in touch with Hutch Ashoo to know more about investment management and investment philosophy.
Whether it is Citi® Personal Wealth Management or anyone else, understanding the firm’s investment philosophy is very important. It will give you insights into how your hard-earned money will be invested.
Wealth management firms have neat-looking websites with glossy reviews. There is a long list of services offered and sharp messaging about why the firm is the best option for you. However, when you start interacting with the firm and speak to a wealth manager there, you should be careful about certain claims.
Firstly, if a wealth manager suggests that your portfolio can earn a specific average rate of return every single year, then you need to understand that no one can guarantee future returns. The markets aren’t linear and there will be up years and down years. Over a really long period of time, an investor may average a certain rate of return, but that can completely vary. A good wealth manager is one who can help you reach your financial goals and adapt your financial plan according to the shifts in the market.
Secondly, if a wealth manager suggests that investment costs and fees are the same things, then that should alert you. Fees are what the wealth manager earns in return for the services that he/she offers. Investment costs are expenses incurred during the process of investing, as we have mentioned in the previous section. The two cannot be the same.
Thirdly, it is important that a wealth manager have experience working with high net worth and ultra-high net worth accounts like yours. Managing a sub-$1 million account is very different from managing a $10 million or $100 million account. You want the wealth manager to have the expertise in understanding the nuances of high-value accounts.
We hope that these pointers will help you find the right wealth manager. If you have any questions about wealth management or simply want to explore what Pillar Wealth Management can do for you, then feel free to start a conversation.
Tips for Choosing a Top Financial Planner
We have given you some important insights into wealth management. We talked about Citi® group’s wealth management offerings and its background. We covered the importance of the investment philosophy and how investment costs are something that needs to be accounted for. You probably have one question on your mind now – how to find a top wealth advisor. To help you answer that question, we have decided to list some tips for choosing a top financial planner. We say financial planner assuming that the planner will also be your wealth manager.
The first thing to do would be a self-introspection. You need to ask yourself why you want to work with a wealth manager. Once you know what areas you need help with and what skills you want in your wealth manager, the screening process becomes easier. Before you self-introspect, make sure you skim through this short guide on critical shifts needed to maximize portfolio performance.
Secondly, you can begin your search process by going online and looking up wealth managers near your area. You must do a background check, explore what services a wealth management firm offers, and what kind of clients it serves.
Thirdly, it helps if you use your personal network to find promising wealth managers. The people you know are a valuable resource. Whether it is a business colleague, a college friend, or a family relative, there is no harm in asking them if they are aware of any good wealth managers. It is highly probable that someone in your personal network is also a high net worth or ultra-high net worth individual like you. They may already be working with someone and can refer the advisor to you as well. Plus, you get honest reviews that reveal the working style of the wealth manager.
A word about fee structures
The wealth management industry generally follows two fee structures, a fee-only and a fee-based model. A fee-only model is what it says, only fees and no commissions. The wealth manager gets paid a fee that is either determined as per an hourly rate, a milestone-based approach, or as a percentage of the assets under management.
A fee-based structure involves fees, as described above, and commissions. The commissions are kickbacks or amounts that product companies pay wealth managers for aiding the sale or a product to you – the client. We believe that the presence of commissions can potentially misalign the financial incentives of the wealth manager with the best interests of the client.
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 highnet worth individuals with $5 million to $500 million in investible assets, then feel free to start a conversation.
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