Wealth management is a consultative process aimed to solve or enhance the financial situation of an individual by providing appropriate financial products and planning for the current or future needs of the person and/or his family.
Wealth Management is a broad concept which requires a broad knowledge, including asset management, investment and portfolio management, real estate planning, tax planning, investment advisory services, financial planning, etc.
A person who can build a large, publicly traded company is not necessarily competent—or equipped, from a time and disposition standpoint—to evaluate and follow other such companies.
What is the difference between wealth management and asset management?
- Wealth management combines both financial planning and specialized financial services, including personal retail banking services, estate planning, legal and tax advice, and investment management services. It mainly deals with growing and preserving money
- Asset management is associated with managing the entire capital which can include house, yachts, money, land, intellectual property etc., often used to refer to the investment management of collective investments, while the more generic fund management may refer to all forms of institutional investment as well as investment management for private investors.
Many publications attempt to publish lists of the ultra-high net worth individuals, with the Forbes Billionaires list being the most well-known. However, these lists are based on assumptions, estimates and best available data. Many high net worth individuals who are on any kind of list or in the public spotlight choose to do so because they consider it sound investment to build their brand based on their personal identity. Obviously, many high net worth individuals keep a high profile (and usually intentionally).
However, not all high net worth individuals prefer the spotlight. Many won’t ever be on any list and will do business through proxies precisely for this reason – people chasing high net worth individuals ‘lists’ to approach them. These high net worth individuals value their privacy, relationships, and their money so that they can do business with others without the bias that is present when anyone deals with a high net worth individual client. In short, as a wealth manager, you won’t find a true high net worth individuals list anywhere, one that is not already available in public. You’ll just have to build these relationships through networking.
Active investments mean that the market conditions are evaluated in near real-time, and changes to positions are made accordingly. Investing also causes a big investment in time for filing papers (for tax purposes and so on). Even though all of this information is available electronically, it still takes a significant amount of time to file for each investment. For this reason, high net worth individuals will always need a wealth manager’s assistance.
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