Why Personalized Wealth Management is Crucial for Your Financial Future

Building wealth is an important financial goal for many people as they start out in their careers. It’s important to start saving and investing early because you’ll need to make sure you have enough money saved for the retirement you want. Few people can live comfortably on Social Security alone, which is why personalized wealth management is something you should consider.

Personalized wealth portfolio management is important an important step in financial success and well-being. To help you get to where you want to be, here’s our guide to why personalized wealth portfolio management is crucial to your financial success and well-being.

What is Personalized Wealth Management, and How Does It Differ from Standard Financial Advice?

Personalized wealth management is a type of financial future planning that is tailored to an individual client. Personalization may take into account your age, lifestyle, risk tolerance, cash flow needs, long-term objectives, and your personal beliefs about where to put your money to help you develop an investment strategy that’s right for you.

Standard financial advice can help you set financial goals, create budgets, and get started on your financial journey. The primary difference between personalized wealth management solutions and standard financial advice is that personalization allows your wealth manager or financial advisor to get to know you and your priorities–and that information can help them do a better job of managing your assets.

What Types of Services Are Typically Included in Personalized Wealth Management? 

Personalized wealth management typically encompasses an array of services that can help people maximize their returns and plan for a bright financial future. Here are some of the services you can expect to find when you work with a private wealth management firm:

• Financial planning
• Investment management
• Portfolio management
• Retirement planning
• Wealth planning
• Succession planning
• Risk management
• Tax planning

You may not use every service that your wealth advisor offers, but you’ll want to choose a firm that offers these services since you may need them in the future.

What Should You Look for in a Wealth Manager?

Choosing a wealth manager is a process similar to choosing a financial advisor, but there are a few important differences.

• Make sure to choose a wealth manager who is also a fiduciary. Fiduciary status means that a wealth manager must put their client’s interests above their own when making investment recommendations.
• Select a wealth advisor who has at least five years of experience.
• Read online testimonials and ask for references, then talk to the references about their experiences.
• Ask about the wealth manager’s investment philosophy and compare it to your own. It’s ideal to have someone who feels the same way you do about investing.
• Learn about the fee structure and make sure that it fits into your budget. Fees may vary greatly depending on your wealth manager’s experience and other factors, so make sure to do the math and hire someone whose fees will work for you.

Asking questions is essential because the whole point of personalization is to find a wealth manager who will work closely with you and help you build wealth while remaining true to who you are and what’s important to you.

How Much Does Personalized Wealth Management Cost?

One of the most common questions we hear related to personalized wealth management is about the cost. There are two considerations. The first is how much money you have to invest. That’s a factor because many wealth management firms have a minimum requirement. Depending on the firm, it may range from a couple hundred thousand dollars to millions of dollars.

The second issue is the fee structure. It’s common for wealth management firms to charge a percentage of assets under management, or AUM. Fees may range from 0.5% to 2% of AUM, depending on your wealth manager’s experience and other factors. Some wealth advisors may charge an hourly fee or a monthly retainer fee, but an AUM percentage is the most common fee structure.

What Are the Benefits of Having a Comprehensive Wealth Management Plan?

You may be wondering what the benefits are of having a comprehensive wealth management plan. Here are several to consider.

You’ll Be Able to Maximize Your Earnings and Grow Your Wealth

Whatever long-term goals you have, it’s essential to do whatever you can to maximize your earnings and increase your wealth. Research from AARP shows that only 40% of men and 30% of women believe they have enough money to retire, and 20% have no retirement savings at all.

Working with a wealth manager who uses personalization to tailor your portfolio and investments to your objectives is one of the best ways we know to ensure you’re on track to meet or exceed your financial goals and live the rest of your life comfortably.

You’ll Stay on Track with Your Financial Goals

There’s nothing wrong with having ambitious financial goals, but they’re only achievable if you can manage to stay on track and do whatever’s necessary to reach them. Working with a wealth advisor to create a comprehensive financial plan that prioritizes your goals is necessary.

Your wealth manager can check in with you regularly, help you see your progress, and decide when and if to be more aggressive with your savings and investments. They can also point out if you’ve strayed from the path and help you get back on track.

You May Have an Easier Time Removing Emotion from Financial Decisions

One of the most common investment mistakes people make is reacting emotionally to economic news or stock market fluctuations. Having a comprehensive and personalized wealth management plan can help you take the emotion out of investment decisions.

Your wealth advisor can help you create reasonable parameters for when to sell assets based on your risk tolerance and other factors. That way, it’s less likely that you’ll make spur-of-the-moment (and potentially rash) decisions that could negatively impact your portfolio.

You’ll Always Have a 360° Perspective on Your Finances

When you’re managing your wealth without help, it can be surprisingly easy to lose sight of the big picture. Even if you’ve accrued some investment knowledge, most of us don’t have the bandwidth to keep an eye on everything all the time.

With guided wealth management, you’ll always have someone to keep an eye on your money and investments. You won’t need to be worried about missing something because you’ll have someone who sees everything.

You’ll Have Someone to Identify Opportunities and Risks

Identifying investment and wealth-building opportunities is essential if you want to achieve your long-term financial goals. The tricky part is gathering enough information (and having enough knowledge) to identify the best opportunities. A wealth manager can provide you with the details you need.

On the flip side, you’ll also have someone to point out when something is too risky and doesn’t align with your financial goals. That’s just as important, and just as crucial to your financial stability and success. Your wealth manager can do both things, helping you to take risks when it makes sense and avoid them when they don’t.

You’ll Gain Confidence in Your Decisions

Financial decision-making can be stressful at the best of times, and it’s particularly difficult when you’re facing a major crisis or change in your circumstances. One of the most significant benefits of having a comprehensive financial plan developed in conjunction with personalized wealth management is that you’ll have the information you need, plus some perspective to help you make the best decisions.

The result is that over time, your confidence in your financial decision-making will increase. You’ll learn and grow, gaining knowledge and learning when to trust your instincts. These things will serve you well both financially and personally.