What is Wealth Management

Wealth management is the process of managing all of the financial aspects of your life, with the aim of helping you achieve financial freedom. It can take a number of forms – but usually involves a highly comprehensive process which includes reviewing all aspects of your personal finances, taking into account your savings, retirement planstax responsibilities and future wishes for your estate.

Defining wealth management

The purpose of wealth management is to help protect and grow your money, over the long-term. It usually includes a review of your entire financial position, including your personal circumstances, future plans, tax obligations and attitude to risk.

Wealth management is very effective in that it offers a thorough review of all aspects of your financial position, and it’s very useful to consider if you’ve spent time and energy growing your investments.

Why would you need a wealth manager?

Wealth managers can help you make the right decisions about your money. Their role is to understand your long-term goals and create a financial plan which helps you achieve them.

They’ll also help keep your plans on track through regular reviews, updating elements as necessary and as your circumstances change or life events take place. For example, in your 30’s you may be focused on paying for school fees and establishing your pension plans but later on you may need to consider how to deal with an inheritance, structuring your investments and moving from a career into retirement.

What are the duties of a wealth manager?

The key duties of a wealth manager are to help you structure your finances with the aim of growing and protecting your money. This is usually achieved through a combination of responsibilities including setting up and maintaining a long-term financial plan, helping save you tax, growing your wealth in line with your attitude to risk and maximising any assets you have.

Controlling the actual cost of investing is another element which falls under the remit of a good wealth manager – an important point particularly in relation to any ultimate outcome; you probably won’t want to have created a strong investment portfolio if you’ve had to pay over the odds to do so. There is also a significant additional benefit – entrusting your wealth management plans to an expert helps you enjoy better peace of mind.

Financial planning

Financial planning is just one element of the wealth management process. But it plays an important part by firstly putting in place steps which will mitigate or alleviate any financial risk which could come your way, such as early death, long-term illness or redundancy. Once these scenarios are planned for, the focus then turns to creating and implementing ways to help you save cost efficiently.

Then final part of the puzzle is to ensure that your tax plans are fully optimised as and when you begin to use the money you’ve saved in your pensions and investments. Ultimately the financial plan is the central guide which helps you keep control of your income, outgoings and investments to manage your money and achieve your goals.

Wealth management provides the all-important comprehensive ‘wrap’ around this plan, ensuring that all of the other aspects of your finances are taken into consideration too. This might include your estate plans, wills and trusts.

Managing your investments

Choosing where to invest your hard-earned capital can feel like a bit of a minefield. There are thousands of different investment choices from fixed income and equities; developed to emerging markets, growth to income; small companies to large corporates. A wealth manager will understand how to translate your long-term goals into an investment portfolio which is well positioned to achieve your objectives.

A key element is then the management of this portfolio. Over the long-term one of the key objectives of the wealth management process will be to grow your capital. During rising markets this might seem an easy goal to achieve, but during periods of market volatility a good wealth manager will be able to make impartial and skilled decisions which have your long-term ambitions in mind.

For example, equity markets saw a significant sell off during the pandemic in 2020, falling more than 30%. Wealth managers are able to make judgements about how to move through such periods of instability; in fact, making knee-jerk reactions during volatile times can leave your long-term plans considerably affected.

Speak to one of our wealth managers

Progeny has a network of offices around the UK, Europe, and Asia, and our team of highly qualified advisers can help you with all aspects of wealth management. Making time to review your finances and consider your plans with an expert can help you take better decisions and enjoy peace of mind. Contact our team here.

This article is distributed for educational purposes and should not be considered investment advice or an offer of any security for sale. This article contains the opinions of the author but not necessarily the Firm and does not represent a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.

Past performance is not indicative of future results and the value of investments can fall as well as rise. No representation is made that the stated results will be replicated.