What is wealth management and why is it important?
Wealth management is essentially the practice of chalking out an individual’s financial standing and goals. It is a detailed study and understanding of financial strengths and weaknesses, to segregate the finances and gain maximum financial security or benefits.
A further defining quality of wealth management is that it is delivered in a consultative manner. By being consultative, wealth managers are truly client-centered. A good wealth manager meets a client without any presupposition about what financial products or services are appropriate for that affluent individual.
Wealth management entails coordinating a team of experts to address the needs and wants of affluent and mass affluent clients.
Here are the services that usually fall under the umbrella of wealth management:
- Financial planning
- Investment management
- Philanthropy advice
- Legal exposure planning
- Estate planning
- Tax optimization
- Retirement planning
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Through the best of economic times and the most jarring stock market corrections, our focus is on helping you find your best solutions for living a great life today and enjoying a worry-free retirement. We do this by taking the time to understand your individual needs, using a tailored approach for developing and implementing a plan to make your goals a reality.
Steven W. Fenyves, CFP®, CFS
President & Founder
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What makes a good wealth manager?
A good wealth manager will generally also be a financial planner and:
- Has the education/certifications needed to meet clients’ needs
- Will look at the client’s finances holistically
- Will coordinate with clients’ other advisors
- Listens and addresses each client’s individual needs
- You feel comfortable with them and they answer all of your questions
- Acts as a fiduciary
What is a Fiduciary?
- A fiduciary is a person or organization that acts on behalf of another person or persons, putting their clients' interests ahead of their own, with a duty to preserve good faith and trust. Being a fiduciary thus requires being bound both legally and ethically to act in the other's best interests.
- Financial advisors can be fiduciaries or non-fiduciaries. If they’re not held to a fiduciary standard, they may only be held to a suitability standard, meaning they’re required to offer suggestions that generally fit their clients’ financial situation, whether or not they have higher fees or bigger commissions than other options.
What Is a CFP?
- Certified financial planner is a professional designation awarded to financial advisors who have passed rigorous coursework and an examination to prove their fluency in all aspects of financial planning.
- CFPs must undergo years of training - 4,000 to 6,000 hours in total - before they are eligible to place the letters CFP after their name. They’re also obligated to continue their education even after receiving certification.
- A CFP can help you identify short- and long-term goals for your financial life, make a plan to achieve your goals and then execute on the plan. Goals can include saving for college, navigating debt repayment, preparing for retirement, maximizing the impact of your charitable giving as well as asset protection.
- Unlike some financial advisors, all CFPs are held to a strict standard of fiduciary duty, meaning they must put your financial best interests ahead of their own.
What is the difference between a Financial Advisor and a Financial Planner?
- A financial planner is a professional who helps companies and individuals create a program to meet long-term financial goals.
- Financial advisor is a broader term for those who help manage your money
- Financial advisors are more likely to focus on investment management, while planners take a more comprehensive approach.
- Financial planners usually work to form longer-term relationships with investors than financial advisors do.
- Certified Financial Planners™ (CFPs) are about planning your future and matching your goals to achieve this. We examine cash flow, risk management, tax planning, retirement planning, college planning, investment and estate planning. Investments are only one of the many areas that we deal with.
What are the differences between a CFP® and a Financial Advisor?
- While most Certified Financial Planners™ (CFPs) call themselves financial advisors, not all financial advisors are CFPs. Understanding the difference is important for a few reasons.
- A financial advisor can be anyone who helps you manage your money. There’s no specific licensing or certification process required for someone to call themselves a financial advisor. Typically, a financial advisor will have passed some kind of licensing exam that allows them to buy and sell securities on behalf of their clients.
- A CFP® has proven their ability to provide comprehensive financial planning services and may also provide investment advice and recommendations. All CFPs must meet the same basic requirements to earn the privilege of carrying the CFP® certification. CFPs also must always act as fiduciaries when providing financial advice to their clients.
- Unlike many financial advisors, all CFPs are held to a strict standard of fiduciary duty.