Wealth Management Advisor

Wealth management advisors offer financial advice to high-net-worth individuals. They handle investments, real estate, taxes, and financial products. Wealth managers operate with the sole purpose of growing clients’ wealth.

These advisors generally work for top-notch financial institutions and investment banks. They undertake complex portfolios, diversified investments, and complicated tax filings. Most high-net-worth individuals are short on time and expertise required to make the right financial decision. Therefore, they consult wealth managers.

• Wealth management advisors possess expertise in finance and investment. Clients hire advisors to manage their wealth.
• Only affluent business owners and high-net-worth individuals appoint wealth managers. On the other hand, even common folks earning basic salaries can approach a financial planner to restructure monthly expenses.
• Most wealth managers possess college degrees in commerce, finance, or accounting. In addition, some have law degrees, and additional certifications
• In the US, wealth managers earn $125,751 per annum, on average.

Wealth management advisors are experts in personal finance. They provide a comprehensive analysis of the client’s wealth and suggest necessary changes. Wealthy individuals often lack the time required to manage substantial assets. Alternatively, even patient ones might lack in-depth knowledge of financial markets. Investments require constant monitoring so that the best possible decision is made.

Usually, wealth managers work for individual clients. Most clients who need a full-time wealth manager are affluent and are often categorized as high-net-worth individuals. Consequentially, wealth management advisors earn a substantial salary—even a tiny percentage of 0.5% is a significant amount.

Most wealth managers are hired by reputed financial firms. Whenever an individual client approaches financial institutions, they appoint a dedicated wealth manager to look after the account. Most wealth managers charge about 1% (of total investment). For example, if a high-net-worth individual allocates $9 million to be managed by a wealth manager, the advisor earns 1% in fees—around $90000 annually. Wealth managers can have multiple clients.

In wealth management parlance, the highest paying clients (who possess billions of dollars) are called whale clients or ‘whales.’ Wealth managers compete with each other to sign whales. Most wealth managers possess college degrees in commerce, finance, or accounting. In addition, some advisors have a law degree, and some acquire additional certifications.

It is highly recommended that aspiring managers should acquire certifications—Certified Financial Planners (CFP) or Certified Private Wealth Advisors (CPWA). Aspirants should pass the Series 7 test regulated by FINRA. Investment banks and reputed financial institutions have a dedicated wealth management division. But bigger clients prefer private wealth managers.

Pedro owns a car company. Over time, he has accumulated a variety of assets. Pedro is a high-net-worth individual who cannot spare enough time. He made his first investment in stocks when he started his company. By now he has an array of investments—stocks, properties, row houses, and condominiums. This is not to mention his personal accounts that exhibit huge inflows and outflows of cash.

Again, since he is short on time, Pedro is unable to monitor his investments. Decisively, Pedro hires Mason. Mason is a reputed wealth manager. Now, Mason handles Pedro’s investments. Mason handles asset allocation, he tells Pedro when to buy or sell a particular property or stock. Mason analyzes financial markets and picks the right asset based on the projected rate of return. Ultimately, Mason operates with the sole purpose of growing Pedro’s wealth.

Since Pedro doesn’t have to worry about finance and investments any longer, he is very happy with Mason’s work. In lieu, Mason earns a small percentage of the entire wealth he looks after.

• Wealth managers preserve existing wealth and try to grow it. In contrast, financial planner planners work with non-affluent clients also—these clients cannot invest heavily.
• Both help clients invest. But financial planners offer additional services. They help clients cut day-to-day expenses and save more.
• Although the actual work done by a wealth manager resembles that of a financial planner, there is a key difference—the size of funds. Wealth managers handle substantial amounts, whereas financial planners handle smaller funds.
• Whales are few, and only the best land wealth management jobs. On the other hand, there are lots of open vacancies for financial planners.
• Only affluent business owners and high-net-worth individuals appoint wealth managers. Not everyone can afford wealth management services. On the other hand, even common folks earning basic salaries can approach a financial planner to restructure monthly expenses.
• High net worth clients prefer accredited wealth managers. In contrast, even a family member can be termed a financial planner.
• Becoming a certified wealth management advisor is a painstaking process. It takes decades for an advisor to develop advanced skills. Most advisors have multiple degrees in relevant fields. A financial planner could just be anyone. It could even be a student possessing a sum of money—who tries to chart out a plan for expenses.
• In wealth management, clients have a bigger say in decision-making. Whereas financial planners take decisions on behalf of their clients. Financial planners do not put too much effort into explaining why they choose a particular investment over another.

This article is a guide to what is Wealth Management Advisor. We explain what do Wealth Management Advisors do, their salary, along with examples You can learn more from the following articles -

• Wealth Accumulation 
• Wealth Tax
• Chartered Wealth Manager