Blog Article

What is A Wealth Manager and Do I Need One?

As you begin taking steps to improve your finances, you may come across the term wealth management. It might sound like something for the ultra-rich, but working with a wealth management advisor is something anyone can benefit from. 

What is Wealth Management?

The process of wealth management is all about making decisions that protect your most valuable financial assets. Ultimately, the goal is to provide you with better financial security, particularly as you move into retirement.

Although the idea of private wealth management may feel like something only wealthier people should look into, this isn’t the case. It can be as simple as:

  • managing your financial accounts
  • ensuring that your savings are growing
  • contributing to your retirement funds regularly
  • maximizing tax and interest savings on your accounts

Wealth management can become more complex as your net worth increases and if you choose to add estate planning or trusts, along with additional investments.

What is Investment Management?

Investing your money in the stock market will look unique for everyone. Those funds will likely become part of a portfolio that contains:

  • Stocks
  • Bonds
  • Annuities
  • Mutual funds
  • Exchange traded funds
  • Index funds

There is an element of risk involved with investing in the stock market. This is why it’s so important to work with investment management professionals who can create plans and allocate your assets on your behalf. Unlike a traditional savings account, these portfolios will need to be constantly assessed and changes made to maximize their revenue potential.

Can I Manage My Wealth and Investments on My Own?

You may be wondering if it’s worth paying a wealth manager or if you can handle your assets by yourself. The answer will be different for everyone and your personal finance situation.

If you’re just starting out and building a basic savings account and IRA, you will likely be better managing these investments on your own. Using tools like a Money Tracker can help you build out your financial goals and work to achieve those.

Once you start to build more wealth, you may want to consider diversifying your investments or making riskier moves. At this point, you should think about working with wealth management companies. High-net-worth individuals (HNWIs), with a net worth of at least $1.5 million, should be looking for a hands-on manager. But even those without that level of wealth can benefit from expert support.

If you choose to invest in the stock market, there are tools like Robinhood that you can use on your own, but these do come with higher risks than working with an experienced manager. Typically, these tools are best for those investing small amounts. If you have large sums in investments across multiple accounts, a manager will be a good option.

Although a wealth manager is an expense to account for, their expertise and knowledge will help grow your wealth and protect your assets as much as possible.

What Can A Wealth Manager Do For Me?

Manage your wealth and investments

The primary goal of a wealth manager is to provide you with strategies for achieving your long-term financial goals. This usually involves managing your larger accounts and investments. In most cases, a wealth manager will develop an investment plan for you that includes asset allocation of stocks, bonds, and cash.

From there, your manager will put together your portfolio based on your risk comfort level and financial goals. They will also provide ongoing advice on which stocks are right for you to invest in, when to buy, sell, or trade stock, and answer any questions you might have.

Essentially, a wealth manager is a hands-on strategist and supporter, guiding you as you make decisions about your financial future. Their knowledge and experience are there to help you grow your most valuable assets, along with balancing risk according to your comfort level.

Retirement planning

Besides investment management, your wealth manager will also be able to provide you with retirement planning support. 

This planning will likely involve looking at your current retirement funds, like 401(k)s or IRAs that you may have setup. They can advice on the best strategies to gain tax benefits from your retirement funds, along with protecting those assets long term. 

Your wealth manager will also be able to give you an idea of what cash flow would look like at various stages of your retirement, based on the amount you currently have in your retirement accounts and projected interest. Learn more about how to start saving for retirement. 

Estate planning and settlement

Preserving your wealth for your loved ones after you’re no longer here is a critical part of estate planning. Your wealth manager can also give you guidance on how to best plan for distributing your financial assets upon your death.

This may include strategies like gifting or setting up trusts during your lifetime. Many of these options come with their own tax benefits too, along with providing peace of mind over asset protection.

Some wealth managers can also provide suggestions for eldercare, power of attorney, and succession planning for business owners. 

Wealth planning

When developing a financial plan, your wealth manager will look at your entire financial picture. They use this information to create a strategy that best fits your current wealth situation, along with taking into account the financial goals you may have for the coming years.

You’ll work together to create your wealth plan and ensure you’re comfortable with all of the recommendations being given. From there, your manager will provide you with regular updates and follow ups. 

This is particularly important if you have a major change in your life that needs to be taken into account in your financial plan. Getting married or divorced, having a new child, retiring, or inheriting assets from another relative can all impact your financial situation so will need to be incorporated into your existing plans.

Private banking services

If you’re looking for comprehensive and customized solutions for your finances, consider a private banking service like the West Shore Private Client Group. 

Your private banker will provide you with expertise that support your wealth management needs and give you insight into the range of products and services that will best suit you.

Start Managing Your Wealth Today

At West Shore Bank, our wealth management team is here to support you and help you manage your finances, no matter what stage of life you’re in. Contact us today to discuss how to save and build wealth, or if you could benefit from the support of a dedicated wealth manager.

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Excerpt for What is A Wealth Manager and Do I Need One?

Making decisions that protect your most valuable financial assets.