Money management is an essential skill that anyone should possess. It is even more critical for persons with high salaries but are not finance experts to have the skill of managing money. On the other hand, if you cannot manage your money appropriately. It is easy to find all the hard work you dedicated all through your carer, not resulting in the wonderful retirement that you have always hoped for in your golden years. Having a financial manager will make a difference. With the advancement in technology today, it is possible to find a financial manager online. You can use online review sites such as Uk online reviews to see more finance companies UK online reviews and find reputable financial companies to help you manage your finances. If you want to achieve your financial goals, then definitely you’ll need someone to help you with your finances. Collectively, professionals that offer such advice are referred to as financial advisors. Within this scope, there are two main services; wealth management and asset management. You can either require one or both, depending on you your situation. This article looks at wealth management and asset management and seeks to help you find which will suit you best.
What is wealth management?
Wealth management focuses on looking at the general financial situation of an individual or their whole family and taking the necessary steps to make the most of their wealth, ensuring that it is protected both at present and in the future. Wealth management can be in various forms and consists of a range of services. Some of the services that wealth managers provide include;
- Charitable giving
- Legacy planning
- Tax planning
- Retirement planning
- Estate planning
- Education planning
The main aim of wealth management is to holistically look at the overall financial situation of a client and take the needed steps to make sure that in the long run, their wealth is protected. Typically wealth managers receive their pay as a percentage of the asset in which they are managing. However, at times they can receive their payment on an hourly basis or at a flat rate.
Just as the name suggests, asset management refers to the management of your assets. Assets refer to all of your financial properties. However, asset management inclines and concentrates more on your investments. This consist of bonds, stocks, ETFs, mutual fund, among other investments that you have made. It is an asset manager who will help you determine the type of investments that will best suit your financial state. They will offer help in asset collection and dividing your investable assets between the diverse classes of assets. Specifically, this includes determining the percentage of your portfolio that should consist of growth products such as stock and the percentage of fixed-income products, including bonds. Typically asset managers get their pay based on the asset under their management. Rates are often progressive and decline with the more money that an asset manager will oversee for an investor.
Looking for an asset or a wealth manager
There are various ways of finding an asset manager or a wealth manager. One of the ways that have been tested and proved to be effective is getting advice from a friend or a family member. While this form of endorsement offers the advantage of having an asset or wealth manager who has been tested by another person, be careful. This is because it is not always the case that because a person is a good choice to a close relative or friend, they will be good for you. For instance, it’s become a practice for people to inherit an asset or wealth manager from their parent. Your parents are at a very diverse stage, and this financial manager will not necessarily work for you. Instead, ensure that you go for a financial manager that has specialized in serving clients with similar financial needs and situations as yours.
Which one do you require, a wealth manager or an asset manager?
Deciding on whether to go for an asset manager or a wealth manager is highly determined by the services you require and your financial goals. If you need help with investing, then the appropriate choice will be an asset manager. Based on your portfolio, an asset manager will help you find the best investments option for you. On the other hand, if you need a person who will offer a more holistic approach to your finances, you should go for a wealth manager. Wealth manager will provide you with the help you need financially in almost all aspect, from estate planning to education planning, among others. It is most likely that you will need both a wealth and an asset manager. The majority of financial advisor firms provide both asset management and wealth management.
In conclusion, the Wealth management vs investment management question is highly determined by the type of services you require. Wealth management is broadly concerned with a person’s portfolio and financial life. Asset management, on the other hand, deals with managing and selecting investments. Depending on your needs, you can choose the most appropriate. At times you may need both.