How to Choose a Wealth Management Service That Suits your Needs

admin | December 10, 2020

Wealth Management

When it comes to wealth management, Indians are a little hesitant about how to proceed with the money.

Whether to save it or invest it, it is a hassle, particularly because most individuals have no knowledge about financial planning – how it’s done and why it should be done.

This is why people lean towards wealth management firms for expert advice.

If you have been investing for a long time or haven’t done it before and want to turn the responsibility of managing your financial portfolio over to someone else, going with a wealth management company is one of the best ways to do it.

Now when you look up at wealth management firms, they are all different.

You need to ensure that you do some background research to choose the right one for you.

The best wealth management services in Mumbai will cater to your financial requirements and plan a strategy that works for both the present and future.

So, if you are ready to build serious wealth, this post discusses factors you need to consider to choose the right wealth management service as per your finances.

Start with Asking the Right Questions

Before you choose a wealth management firm, you would want to ask them a few questions to get things straight. There are a few questions that you should ask the firm to assess its performance.

1. What is your business model?

You need to understand what business model they use. Find out whether they are publicly or privately held, determine the structure of their platform, including their core business strategy, and ask how they are potentially going to manage your wealth.

Also, the majority of companies offer wealth management, but their primary business model focuses on other financial services like lending and banking, or even insurance.

You would want a firm that solely focuses on wealth management and related entities.

2. How do you serve your customers?

This is another important question to ask the company because it will help you in understanding the structure of their client service model.

In short, you would want to know what you will be receiving from their end.

Will your financial advisor be there to help you when you need them?

Will they encourage you to change your investment strategies as per the market demands?

Will they allow you to explore different wealth management options within their firm before you ask them for their advice?

3. Are they managing your wealth or investments?

There is a significant difference between wealth management and investment management.

Wealth management includes asset location, long-term wealth preservation, after-tax return, and intergenerational wealth transfer.

Investment management, on the other hand, focuses on asset allocation and returns.

So, clear this thing first before you get into doing business with them. You should have a clear understanding of what you want to do with your money.

4. What is your investment approach?

The investment approach of a wealth management company is a critical area to explore.

Try to determine their historical investment performance, whether they utilize individual securities or mutual funds, whether their approach is model-based or customized to the client, and whether they provide access to outside managers or only offer proprietary investment opportunities.

5. Do you understand me?

The last way to assess a wealth management company is culture. Identifying whether they are a cultural fit for you is science more than art.

Do they have a grasp on your aspirations, personal goals, and business? Are they devoted to seeing you meet your objectives as you are?

Are your investment ideologies aligned with the firm? Do they perceive your existing portfolio and your approach to how you want to grow it?

Don’t Focus on Price

When choosing a wealth management company, the majority of people judge the difference between the firms based on ‘price.’

This is a wrong approach, especially when you are handing your money to a third-party company. Instead, you should focus on value.

Your primacy focus should be on what you get rather than what you pay. First, understand how your financial advisor is going to get paid based on the service they offer.

Then decide whether the value you get from their service is in line with the cost they are asking. Cheaper isn’t always better.