Wealth management is an umbrella for a range of services that companies provide such as:
• Portfolio management
• Investment advisory
• Real estate planning
• Succession planning
• Taxation advisory
• Legal advisory etc.
However, this service when extended to individuals is called private wealth management. When it comes to wealth management, the term private wealth management is used interchangeably with wealth management services.
While it may seem like private wealth management is the domain of the high net worth individuals, it is worth it for people with smaller portfolios to consider it as well. With the introduction of digital wealth management, the costs of getting wealth advice are falling. There’s no better time to get wealth advice.
Here are 3 reasons why you need private wealth management:
1. Professional advisory services:
Private wealth management India is a wide range of professional services that are provided to the investor. It begins from framing goals and managing investments to covering a wider range of services as and when required. For example, the wealth manager can help with taxation when you sell off any investments. They also provide consulting if you want to set up a philanthropic venture or donate your funds. The scope of a wealth management agreement is decided for each contract individually which means there is no standard set of services offered to every client. It depends on the type of consulting that the investor needs and more can be added on in the future.
If you’ve already got an investment portfolio, private wealth management can help you systematically grow the portfolio and earn a good return on it. On the other hand, if you have not started with investments, you can opt for robo advisors and slowly start building a portfolio.
2. Portfolio monitoring and evaluation:
Unless you are actively monitoring the portfolio, it gets difficult to know when to exit loss making investments and rebalance the portfolio based on re-evaluation of life goals. Having a wealth manager means a regular evaluation and consistent monitoring. It is the responsibility of the wealth manager to grow the portfolio in the best possible way given the risk profile of the investor. This is why it is worth it to avail these services. With digital wealth management, investors can track their portfolio themselves using an app. This can also help them get portfolio performance data whenever they require it.
3. Goal based investing:
Goal based investing is the best way to ensure that you manage to save up for all the goals that you want to save for. It also helps you to save adequately. The first step a wealth manager takes is to help the investor set goals and decide his risk tolerance. Based on this, the investments are customized. By developing different goal based investments, the investor stands to get funds when he requires.
Nirav Desai is a financial advisor and has a 10-year plus experience of working in a reputed mutual fund company. In this article, he has researched on private wealth management and explained why one needs it