The terms “Wealth Manager” and “Wealth Management” can mean many different things to different people. However, to most people the terms are still synonymous with private banking and the super rich.
Wealth Management departments started to appear back in the 1980’s when the term was first coined by elite retail (or private client) divisions of banking firms such as Goldman Sachs and Morgan Stanley in the United States. The main aim of these departments was to attract wealthy customers by citing the provision of a more bespoke offering than was available from other high street banks at the time.
However, as the world has moved on in the ensuing decades so has this specialised industry sector. Indeed, in 2012 the reach of a Wealth Manager is far from confined to the rich and famous.
Modern Wealth Management
Over the years Wealth Management has come away from being solely the preserve of the wealthy and has instead continued to move more and more towards mainstream society. This change, in large part, has been brought about because of recent technological advances. It is, after all, no longer a costly and laborious task to invest money. Instead, with the onset of on-line trading facilities, this can now be done in the blink of an eye and as technology has moved on so have financial products, their cost efficiency and their effectiveness.
In media circles it has long been purported that financial or banking professionals are likely to receive substantial reimbursement for their work. However, the reality is somewhat different. In simple terms, financial profit margins themselves are extremely slim. The banking world is able to profit by employing one vital mantra – volume! This is either sought by providing high street banking services to millions of customers making small transactions or by providing private banking services to a smaller number of customers with extremely deep pockets.
Previously, a Wealth Management company would only be able to run a profitable business if it looked after the affairs of the wealthy. However, with the ease with which money can now be invested and the respective time savings in all things administration, it has followed that the Wealth Manager can now more effectively deal with a smaller and smaller case size.
How does this affect me?
The migration towards a broader market base has brought with it the opening up of previously inaccessible services to the mainstream.
In it’s simplest form a Wealth Manager’s role is to advise their clients on all of the areas that make up a clients personal financial affairs. As each client has specific requirements in line with their own personal situation so it is the job of a Wealth Manager to use their knowledge of the financial world and the products available within it to help their clients achieve their named objectives.
Take a moment to think of every important milestone that you will come across throughout your life – getting married, having children, buying a home, ensuring your children’s education is provided for and finally the big one – retiring in comfort.
Although some of these areas have dull connotations surrounding them, each also has a large financial consequence. The primary job of a Wealth Manager is to help their client consider all that he or she would like to achieve throughout their lifetime and then to help them plan and realise all of these aspirations over time.
Some of the other main areas in which a Wealth Manager can assist are;
- Professional Investment Advice
- Asset Management
- International Tax Advice
- Pensions Consolidation
- Foreign Exchange Advice
- Mortgage Advice
- Estate Planning
With economic turmoil having spread across the world over the past few years and a far from certain future, more and more people are currently seeking and thriving from the advice that a Wealth Manager can bring. As this service sector has moved down to mainstream society so has the ability of the man on the street to receive sound financial advice. After all, the real job of any Wealth Manager is to do only one thing – bring about absolute peace of mind for their clients’ financial future.