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.
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.
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:
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.
Choosing a wealth manager is a process similar to choosing a financial advisor, but there are a few important differences.
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.
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.
You may be wondering what the benefits are of having a comprehensive wealth management plan. Here are several to consider.
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.
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.
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.
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.
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.
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.
Personalization is only useful when it’s current and relevant to your financial circumstances. You’ll need to notify your wealth management team whenever your life or personal circumstances change. It's important to know that the National Credit Union Administration does not insure your investments. Here are some examples of times when you might need to review your personalized wealth management plan and adjust it to meet your needs.
We suggest talking to your wealth manager at least once a year and at any time when your financial needs or goals change.
Personalized wealth management isn’t something you can afford to ignore as part of pursuing your long-term financial goals. You’ll have the best possible chance of turning your financial dreams into reality when you have the advice and guidance you need to make smart financial decisions at every stage of your life.
Do you want to see what personalized financial services can do to help you build wealth? Leaders Credit Union’s Guided Wealth Portfolio offers a combination of personalization and automation to help you pursue your most important goals. Additionally, you can download and use our free Investing 101: A Guide to Growing Your Wealth to gain deeper insights and strategies for your investment journey.
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Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Leaders Credit Union and Leaders Investment Services are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Leaders Investment Services, and may also be employees of Leaders Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Leaders Credit Union and Leaders Investment Services. Securities and insurance offered through LPL or its affiliates are:
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