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Why You Need Different Wealth Management if You Have a High Net Worth

Why You Need Different Wealth Management if You Have a High Net Worth

23 Sep 2022

If you have a high net worth, it can be difficult to find the right wealth management solution. There is no one-size-fits-all solution. The needs of high-net-worth individuals (HNWIs) often differ significantly from those of the less affluent: You need specialized advice and services to meet your specific requirements. 

Unfortunately, many financial advisors do not have the expertise to work with HNWIs (or they are not willing to invest in the necessary resources). This makes finding a wealth management firm that has specialized in providing the value-added service you need vital.

This article explores HNWI wealth management topics, including:

  • Why high-net-worth wealth management is unique
  • How our elite-level services differ from other firms’
  • The advantages of personalized financial advising
  • What can be done to better safeguard your legacy

High-Net-Worth Individuals Face Special Challenges

When you have a high net worth, you must approach your finances differently than someone with less money. There is a great deal more at stake, financially. As a result, your investment choices and risk management strategies must differ from the average, just as your tax planning and estate planning strategies should.

The Benefits of Specialized Advisory Wealth Management

One of the most important benefits of reputable wealth management advice is that it is tailored to the needs of your individual situation. A fiduciary advisor will work with you to determine a financial plan that is specific to your situation. 

Additionally, they can help guide you through decision-making, for instance, as to how much risk should be taken to achieve specific goals. Similarly, a quality advisor may serve as a sounding board while a client considers what type of investment vehicles will best showcase its value over time. The right wealth manager will also offer unique insights into how different types of investments fit together, interacting within your overall portfolio strategy. 

This is one of many services that can prove invaluable, since, for example, some investors prefer stocks over bonds for better returns while also reducing volatility. Meanwhile, others may prefer fixed-income instruments (such as bonds) because they are less volatile than stocks, but still offer decent returns over the long term. 

White-Glove Service

It is not enough to get the best financial products on the market. You also need a portfolio management team committed to you and your family’s success—to help you build wealth for years and decades to come. At this level of wealth management, there are many options available, including a dedicated relationship manager who thoroughly understands your goals (and can recommend changes in investments as needed).

An experienced team working together with you to understand your unique situation can make certain that all aspects of your finances are well taken care of.

We Can Help You Avoid Pitfalls

Our full-cycle investing services include helping clients keep wary of potential missteps, such as potentially disastrous investment choices. One of the biggest mistakes high net worth individuals often make is buying into things like high-risk hedge funds, private equity funds, and venture capital funds. The complicated structures of these investments are not appropriate for most people because they can require extensive market expertise to fully utilize them.

Similarly, we keep alert to help you guard against tax inefficiencies. This is another area in which high net worth individuals often fall short: As your income increases significantly over time, it becomes more important to address potential tax issues before they arise. The more proactive we are, the lower your chances of paying more than necessary on April 15th each year. Additionally, we can help avoid inadvertently triggering penalties that could affect your ability to access your money when you want it back.

We Can Help You Get Your Affairs in Order

If you were asked to name your current net worth, would you struggle to produce a number? We can easily understand, if so. Sometimes the irony of success is that in order to keep it, we sometimes have to develop tunnel vision. 

As a result, our specialty services include helping you get on track with your financial affairs when life spreads your focus thin. In other words, our team is here to help you:

  • Identify what you own and owe.
  • Identify the people who will benefit from your wealth.
  • Create a plan for passing on your assets after death.
  • Ensure that all of your insurance needs are met in case of disaster or illness.
  • Consider every aspect of your financial security, including your retirement planning and charitable giving

At the end of the day, we are out to assist you in maximizing the benefits of having a high net worth—and limit (or better yet, prevent) unpleasant surprises along the way. 

 

Let Us Help Plan Your Retirement—And Reduce Your Taxes Over the Long Term, As Well

 

We Can Help You Evaluate Your Assets

Once you know your current net worth, it is time to evaluate your assets. This is critical because it can help you determine what direction your wealth management should go in. For instance, imagine that most of the value in your portfolio comes from stocks, bonds, and cash investments with market values that can change at any moment: You may want a different kind of investment strategy than someone who has more money tied up in real estate or other property like art or jewelry. 

This is because more frequent adjustments made to a portfolio are necessary since markets fluctuate so much more frequently than real estate does. Whatever your favorite investing strategy is, you need someone who understands factors like market fluctuations well enough to anticipate them before they impact your nest egg.

We Provide Opportunities That You May Overlook

Our services are designed to help you maintain a high quality of life—in a way that takes advantage of opportunities that other advisors might not recognize. We are committed to finding solutions for our clients’ most pressing needs and providing them with access to resources they did not even know existed.

We can also provide guidance when it comes time for inheritance planning, which is a complex process that requires an understanding of tax laws and estate planning strategies. 

We Can Give You a Fresh Perspective on Your Inheritance Planning

Is it time to update your estate plan? If you do not feel certain of the answer, please ask yourself these questions:

  • Do I have a current will?
  • Is my current estate plan still relevant?
  • Do I have a trust?
  • How will my philanthropy continue?

If the answer to any of these questions is “No,” it is probably time for an update. However, the good news is that we specialize in helping you make changes, as necessary, as easily and conveniently as possible.

We Have Expertise in Asset Protection

ohio financial advisors hand mimicking a roof covering small tiny blocks of wood that are supposed to be houses

Asset protection is the legal practice of protecting your assets from creditors, judgments, lawsuits, and more. This is a crucial component of wealth management for high-net-worth individuals because if your assets are not safeguarded, your wealth could be taken away. 

Threats to the longevity of your money and assets can take multiple forms. These can include excessive taxes or the dissolution of your former legacy in a probate court. For these reasons and more, we work vigilantly to help ensure your overall protection. For example, taxes can often be significantly reduced through a combination of long-term financial strategy and shrewdly-chosen charitable giving vehicles.

Meanwhile, your financial legacy could be preserved through gifting money or property to family members or friends, which would not incur capital gains tax on those transfers. Avoiding probate can be done by assigning certain financial accounts (including life insurance policies) over to individuals you trust before your passing. 

By providing all of these specialized services and more, McGervey Wealth Management has become a resource for high-net-worth financial planning in Akron-Canton, Ohio. Contact us today to see the difference we can make.

More About the Author: E. Michael McGervey, CFP®, CRPC®

Mike is passionate and skilled at helping clients solve complex financial challenges. He’s known for his thoughtful communication, educational approach, and exceptional customized service. Mike has been a sought-after source for financial television, magazines, and newspapers looking for insightful analysis. His expertise has been featured by CNBC, FOX Business and...