When you have more wealth, you usually have access to a wider range of investment options, but you also likely…
When you have more wealth, you generally have access to a wider range of investment options, but you also likely have more complex financial needs. The vast and complex needs that come with higher wealth is why the financial industry has a separate division that works with high net worth investors. Financial advisors and entire firms, sometimes referred to as wealth management advisors or wealth management businesses, are dedicated to meeting the needs of these wealthier people. But how to find such an adviser to higher wealth? The experts have some tips on what to look for and where to look:
— Do you need an advisor for a higher estate?
— What to Look for in a Senior Wealth Advisor.
— Where to find a higher wealth advisor.
Do you need a Higher Wealth Advisor?
Before you start looking for an advisor to meet your needs, you need to know what you are looking for. “The first step to wealthy investors should identify their personal goals and find the advisors who can best help them achieve them,” says Steve Wittenberg, director of legacy planning at SEI Private Wealth Management.
Consider what drives your search, he says. Are you going through a major transition, such as the sale of a business, or a personal event such as a birth or a divorce? Maybe you’re just a former handyman who wants better support. Either way, why you found a wealth advisor can help you determine which advisor is right for you.
What to Look for in a Senior Wealth Advisor
“Look for an advisor who doesn’t just pick investments for an individual’s portfolio, but who champions your entire financial picture,” says Belinda Herzig, senior national wealth strategist at BNY Mellon Wealth Management.
Higher wealth means you’ll likely need a myriad of services beyond just managing investments, such as estate planning, charity donationtax planning and Insurance. Your advisor should work as a team because no one can do everything, says Herzig. “If you have people who don’t want to collaborate with the whole team of bankers, accountants, lawyers and insurance professionals, you have to be careful.”
A key tip she shares is to require one team member to act as quarterback to coordinate the pro squad. “This senior adviser must be able to oversee tax policy changes that affect income tax planning as well as tax planning of wealth transfers,” says Herzig.
Make sure the adviser is a fiduciary, adds Wittenberg. Only trustees are legally bound to put your interests first at all times, which is especially important when looking for more holistic services. Trustees will work on a paid modelcharging for advice rather than earning commissions on the products they sell.
Many fee-only models use an assets under management, or AUM, approach where you’re charged a percentage of the money you’ve invested with the advisor. These structures are often provided on a sliding scale with lower fees applied to higher assets under management, which can therefore be an advantageous structure for high net worth investors.
In addition to the above, Wittenberg also recommends seeking advisors with:
— Certified Financial Planners or CFPs and other subject matter experts in estate and gift taxes, trust tax planning, tax planning and philanthropy.
— A process to consult with other experts and help clients weigh their options before making decisions.
— Expertise in succession planning and asset protection, including life insurance and property and casualty insurance.
— A formal relationship with a corporate trust company to handle the administration of the trust and act as a corporate trustee to protect your assets.
Where to Find a Higher Wealth Advisor
Once you have an idea of the type of advisor you are looking for, it’s time to start your search. A starting point is your bank, says Herzig.
“I often get asked this question because many of our clients are looking for new representation or have outgrown their existing group of advisors,” she says. “We are becoming a great resource for starting the conversation because at BNY Mellon Wealth Management we work with many accountantslawyers and insurance professionals across the country.
Other finance professionals can also be sources of referrals. If you already have a CPA or attorney you work with, you can start by asking them for the names of advisors who work with wealthier clients. Many attorneys with high net worth clients have advisers they’ve worked with in the past, says Patrick Simasko, elder law attorney and financial adviser at Simasko Law.
Since your lawyer and accountant already know your financial situation, they should be able to give you an appropriate recommendation.
You can also get referrals from friends, family, or colleagues with similar goals or needs. “When you start asking your friends or business associates, you’ll start hearing the names of the same professionals over and over again,” Simasko says.
“The best advisors are leaders in their field, and with a few referral calls, you should continue to come across the same small group of talented people with experience working with clients in a similar situation,” Herzig says.
Another place to look are organizations such as the National Association of Real Estate Planners and Consultants (NAEPC), which provides a searchable database of local real estate planners. Note that not all licensed estate planners are also financial advisors, but you’ll likely find at least a few in your area with both. identifiers. Look for AEPs with the CFP, ChFC (Chartered Financial Advisor), or MSFS (Master of Science in Financial Services) designation, or who indicate they work at a financial planning firm.
Wittenberg suggests “looking for an advisor who frequents real estate advisory organizations or describes themselves as an UHNW (ultra high-net-worth) wealth manager or multi-family office.”
Once you have a list of potential candidates, Wittenberg suggests creating a list of questions about the advisor’s practice and experience working with high net worth clients so you can more effectively weigh your options.
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Update 8/6/22: This story was published at an earlier date and has been updated with new information.