What Does a Wealth Management Company Do?

Wealth comes in many different forms, and wealth does not necessarily mean having a large amount of money sitting in your bank account, and people with wealth and disposable income usually have complex financial arrangements. Generally, wealthy people have ‘assets’ that diversify their wealth and this is where wealth management companies come in. 

What Is Their Job?

The job of a wealth management company is to make these assets work efficiently and productively. People employ wealth management companies because of the complexity of the markets; as an in depth knowledge of both financial markets and investment opportunities required.

A wealth management company manages the wealth of its clients. People with a high net worth or HNW as it is known by people in the financial sector, are generally people who have financial assets that are valued at around $1 million.

There’s no set type of client eligible for wealth management, however. Although many people who employ wealth management companies come from the financial sector, business owners, celebrities, entrepreneurs and people who have acquired their wealth through inheritance also use them widely. 

What’s On Offer?

What a wealth management company offer is completely dependent on the individual’s assets. It is incredibly common for a client to have a diverse portfolio of assets rather than a cash lump sum in a bank account and, as a result, wealth management companies provide comprehensive financial support.

Advice offered is wide ranging, covering a number of different strategies such as taxes and asset protection, investments and property advice. Due to the fact that a wealth management company cannot be experts in all of these fields, they will act as a front for other parts of the bank or for other institutions that have a more in depth knowledge of how to invest. These other sectors or companies, however, will always be trusted partners.

Employing a wealth management company is a long-term strategy and, as such, you should not expect to make a quick buck. As a result, wealth management companies such as Sanlam Private Investors will touch upon many aspects of their clients’ lives in order to build a solid client-business relationship. This is vital to create trust between the two parties; especially with the size of the money that could be gained or lost.

Discretionary vs. Non-Discretionary

Wealth management is available at a discretionary and non-discretionary basis. If a client opts for a discretionary service, they effectively hand their assets over to the bank and the bank will invest on their behalf; assuming responsibility for protecting and growing the wealth of the client. On the other hand, non-discretionary means that, although the client receives advice from the bank, ultimate decision-making still lies with the client.

So, if you’ve got a wide range of assets and want to expand your wealth, try giving a wealth management company a try.