Those with a high net worth may need financial advice; for this, they may use a wealth manager

Wealth management is a wide-ranging term that covers many aspects of finance. Generally, it refers to a system of financial planning, the management of investment portfolios and a number of other services. Small business owners, families and high net worth individuals are the primary users of a wealth management company, because they usually require a good system of financial management, but do not have dedicated staff for the purpose.

Wealth managers themselves are, in most cases chartered to ensure that they are effective when working with money. The main aim is to ensure that a client’s money is secure, well invested and that the future is accounted for. This is extremely valuable to individuals and families who have accumulated considerable wealth. Poor investment and unnecessary taxes in particular can prove to be a significant expense, which require mitigation if they are to be avoided.

Managing the Portfolio

Investment is probably the largest branch of wealth management, because investment generally means profits; something clearly desirable. It can be extremely difficult for even those with a  good business and financial sense, to know where is best to invest money. Wealth management companies are extremely useful in this respect because they have an excellent knowledge of how to utilise a portfolio effectively. They can also help when an investor is looking to be ethical with their investments. Some managers such as Sanlam wealth management London, can help a client with offshore investment, which is designed to get even more out of the portfolio.

Thinking Ahead

Planning for the future is also of clear importance to those with considerable wealth. There is a focus on making sure that the money lasts for as long as possible, does not go to waste, and ideally, becomes effective inheritance. Part of this may involve investment to ensure that inflation is not an issue, but there can be a great many other aspects to this, such as when planning for income in later life. This is one of the main differences between financial advisors for companies and wealth managers for individuals. A company does not have a defined end; ideally it would last forever, where and individual has a finite amount of time in which to manage their money.

A Tailor-Made Service

It is worth noting that wealth management is a highly bespoke service. There is no one system that will work for all clients; there are far too many variables. The manager will take into account all of a clients circumstances, assets and portfolio when making any decisions. For this reason, managers with an excellent reputation are highly sought after. The recent financial crisis has caused havoc with some accounts, after a great many investment positions have changed considerably. This again highlights the importance for those with wealth to have their money professionally managed, and for the managers themselves to be experts in their field.