As your net worth increases, the complexity of your financial situation increases as well, making a capable financial advisor crucial to your financial success.
If you are a high or very high-net-worth individual, finding a financial planner that specializes in providing personalized advice is essential, but not always easy. While some financial tactics and strategies will apply to everyone regardless of their income or assets, some will only apply to high-net-worth families. More general financial strategies may include saving for retirement or budgeting, while generational wealth planning and complex tax minimization strategies are much less common but often most important for high-net worth individuals.
A High-Net-Worth Financial Advisor
High-net-worth financial advisors specialize in providing advice and services tailored to the needs of wealthy individuals, families, and businesses. They specialize in more complex areas of investments, tax planning, estate planning, philanthropy, and insurance.
The right financial advisor will develop a personalized comprehensive financial plan in each of these areas. For example, investment advice and management is often a top priority for high- net-worth individuals, and experienced advisors can provide valuable advice and execution on strategies to help minimize taxes and maximize returns. That process of improvement will continue across each area of a client’s financial life, being continually directed by the client’s goals.
What To Look For
Working with a professional financial advisor can provide many benefits, such as increased financial security, peace of mind, and the optimization of generational wealth.
An effective high-net-worth advisor should have extensive experience in dealing with high-net- worth clients. Through advisor-provided monitoring of investments, updates on financial markets and timely tax strategies, high-net worth clients should attain security and peace of mind in their financial situation.
Experience
An effective high-net-worth advisor should have extensive experience with high-net-worth cases and will have navigated clients through market or economic downturns and a variety of different financial situations. There is risk associated with being an advisors “first time” dealing with a specific issue.
It is important to understand an advisor’s approach and what services they provide specifically for high net-worth clients. Especially, a high-net-worth focused advisor should be adept at developing long-term strategies for estate planning and asset protection to provide for future generations.
Expertise & Certifications
High-net-worth advisors should be knowledgeable and accomplished in all aspects of financial planning, especially investments, taxes, estate planning, and insurance. Additionally, some certifications and professional designations are especially relevant to high-net-worth clients, including the CFP Professional designation or the Chartered Financial Analyst (CFA) designation. These certifications are generally considered the premier designations in wealth management.
Fees and Transparency
High-net-worth financial advisors typically charge fees based on the value of your portfolio and/or the services provided. It is crucial to understand the advisor’s fee structure before engaging in any services. Fee-only advisors have the fewest conflicts of interest (they cannot receive any commissions from third parties) and thus tend to provide the best advice overall. The best advisors will also function as fiduciaries who are legally obligated to act in your best interest.
Finding The Right Financial Advisor
Initial Consultation & Interview
Start by scheduling an initial consultation with the financial advisor. This will provide an insightful opportunity to establish a relationship, discuss your objectives and determine compatibility. Ask questions about their approach, experience working with high-net-worth clients, fee structure, additional services and other concerns. A good advisor will allow you space to gather information and make a decision at your own pace.
Process
The right advisor should have a thorough understanding of your goals and objectives and be able to explain their process in detail of how they plan to assist in reaching your goals.
Monitor Progress
Once an official relationship is established, continue to monitor your progress together. Over time, your high-net-worth advisor should add significant value to your financial life, well above the fees they charge. This may come in tangible forms, such as saving you money in taxes or generating strong investment returns, or intangible, such as improving your understanding of your finances or bringing you a greater sense of financial security.
Ultimately, finding the right high-net-worth financial advisor can be essential to your financial success. With the right professional, you will be able to achieve your goals in a more secure and efficient manner. Take your time when choosing an advisor to ensure they have the necessary qualifications, experience, and expertise. Finding the right financial advisor is a path to a more abundant financial future. Contact TrueNorth Wealth for more information.
