Wealth Management

Wealth management is a set of financial planning services tailored to affluent clients with a high net worth. Wealth management advisors provide a range of services, including financial, investment and legal advice, along with accounting and tax services and retirement and estate planning.

Written by
Terry Turner
Terry Turner
Senior Financial Writer and Financial Wellness Facilitator
Terry Turner has more than 35 years of journalism experience, including covering benefits, spending and congressional action on federal programs such as Social Security and Medicare. He is a Certified Financial Wellness Facilitator through the National Wellness Institute and the Foundation for Financial Wellness and a member of the Association for Financial Counseling & Planning Education (AFCPE®).
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Edited By
Matt Mauney
Matt Mauney
Financial Editor
Matt Mauney is an award-winning journalist, editor, writer and content strategist with more than 15 years of professional experience working for nationally recognized newspapers and digital brands. He has contributed content for ChicagoTribune.com, LATimes.com, The Hill and the American Cancer Society, and he was part of the Orlando Sentinel digital staff that was named a Pulitzer Prize finalist in 2017.
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Reviewed By
Ebony J. Howard, CPA
Ebony J. Howard, CPA
Credentialed Tax Expert at Intuit
Ebony J. Howard is a certified public accountant and freelance consultant with a background in accounting, personal finance, and income tax planning and preparation. She specializes in analyzing financial information in the health care, banking and real estate sectors.
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Published: April 28, 2020
Updated: July 10, 2023
5 min read time
This page features 3 Cited Research Articles

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Wealth management can be helpful for affluent individuals who need extra advice and diligence in managing large amounts of assets.

This can be especially true for high net worth individuals, which the U.S. Securities and Exchange Commission defines as someone with $750,000 in assets under management or $1.5 million total net worth.

Is Wealth Management Right for You?

Wealth management is best suited to people who are already affluent. Some firms may require a minimum investment of $250,000 to $10 million.

But as you build wealth over your lifetime, wealth management may become a better option than your current financial planning or investment options. A wealth management advisor can tailor investment planning and strategies to help you manage your assets.

Wealth Advisor vs. Financial Advisor

Financial advisor is a broad term that applies to different types of financial services. Certified public accountants, for instance, specialize in taxes and accounting. Other financial advisors may specialize in life insurance, stock investments or estate planning.

People who may not have enough wealth to open a wealth management account may still benefit from specific forms of financial advisors.

Wealth advisors are a specific type of financial advisor that specialize in helping affluent individuals manage their assets. Their firms bundle several financial and asset management services together. They may offer financial, retirement and estate planning along with legal and tax advice, among other services.

How Much Do Wealth Managers Cost?

Wealth managers charge a fixed annual fee based on a percentage of the assets they manage for you. The fees are usually around 1 percent. Clients with larger portfolios may be charged at a higher rate.

Source: Forbes

Private Wealth Management

Private wealth management provides a wide range of financial services and products to individual clients, as opposed to corporations or other institutional investors.

Affluent clients generally require more investment and asset management than typical financial advisors can provide. They frequently require more vigorous and active management of their financial interests than people with less wealth.

Private wealth management firms can address this need by bundling services and bringing together expertise on a wide range of financial issues.

What is capital preservation?

Services

The exact bundle of products and services wealth managers provide vary from firm to firm. You may want to consider what services are most important to you.

Services offered by wealth management firms may include:

Estate and Family Legacy Planning: Making a plan for how your wealth will be distributed after your death.
Insurance Planning: Determining the types and amount of insurance you need to protect your assets.
Investing Advice and Management: Providing professional advice on which securities to invest in and strategies to follow.
Legal Planning, Advice or Services: Advice on complying with tax laws affecting your assets and investments, setting up estate planning, trusts, philanthropic gifts and related planning, and representing you in lawsuits and legal resolution of disputes.
Philanthropic Planning: Advising you on large-scale charitable gifts to worthy causes.
Private Banking Services: These are banking services designed to protect and maintain your assets.
Retirement Planning: Helping you determine your retirement income goals and planning a strategy to achieve them.
Risk Management: Forecasting and evaluating your financial risks and planning how to identify, avoid or minimize those risks.
Tax Planning and Services: Analyzing your financial situation from a tax perspective to ensure the greatest tax efficiency, meaning you do not overpay your taxes.

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Wealth management firms and advisors customize these services to individual clients. This can be helpful in major life events for the client from health care and Social Security benefits to help starting or selling a business.

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How to Choose a Wealth Management Firm

Choosing a wealth management firm requires you to consider how well your needs and goals fit with the experience and services of the firms you are considering.

You will want to find a firm that gives you the best value for the fees you are paying. There are some specific things everyone should consider before deciding on a wealth management firm.

What to Consider When Choosing a Wealth Manager

Take in account the wealth manager’s minimum net worth requirement. This can let you know immediately if the firm is a realistic option for you.
Ask for the manager’s advisory certifications to determine the firm’s experience levels in areas such as accounting, financial planning or other areas related to your specific goals.
Compare the wealth manager’s fees with other firms.
Look up the manager’s Form ADV on file at the Securities and Exchange Commission’s Investment Adviser Public Disclosure website.
Make sure the wealth manager abides by fiduciary duty — meaning they follow legal and ethical requirements to act in your best interest.
Know whether the firm is fee-only (all their income comes from a percentage of your assets they manage) or fee-based, meaning they will charge extra hourly or performance-based fees on top of their percentage.
Consider how the wealth manager’s package of services fits with your primary concerns for wealth management. For example, if retirement planning is your top priority, make sure it’s a leading service of the firm.

You may also want to consider their track record and make sure they are available to discuss your needs or answer your questions if you choose the firm.

Last Modified: July 10, 2023