Paying Closer Attention To My Financial Statements

Wealth Management Planning

19 October 2020

Barb Morgan

Many people don't know where to start when it comes to investing. It is, after all, often abstruse information for the common layperson both to understand and implement successfully. This is where a wealth management advisor can help. A good wealth management planning firm will take into consideration all of one's factors, not just how much money is in your retirement account or how to save a certain number of dollars each pay period. They will also look at things such as whether you are planning on starting a family, buying a house, going to school or back to school, etc. A good plan is holistic in approach and isn't just concerned with the immediate short-term goals, or the long-term goals, but all one's goals (as a whole). And, an important aspect of any wealth management plan with an advisor is a regular review and making appropriate changes (as needed). 

Of course, the first thing most people start asking themselves at this point is how much it is going to cost them. After all, one of the main reasons people don't seek out the services of a wealth management firm is they think it will be too expensive, or they don't have enough money to start working with one.

However, wealth management advisor services are typically very reasonable and tailored to the particular situation of the individual. Having several amounts of assets or a six-figure salaried position aren't requisite. Pretty much no matter one's situation, an advisor can not only can help but can also provide affordable services. 

Advisor fees pretty much fall within three main categories:

• Transaction-based fees. This type of situation works best for those who are just starting out, and/or don't have much in the way of the assets. In this type of fee structure the advisor is paid for each transaction placed (e.g. each individual buy, or sell order). For example, there might be a $10 fee for each stock buy order placed, or a modest percentage-based fee for buying into a mutual fund.
• Wrapped fees. These tend to work better for those with a modest amount of assets already amassed. In essence, the way this fee structure works is the advisor charges a flat annual fee (usually broken down into quarterly payments) covering all services rendered. So, no matter how many trades, buy, sells, etc. are placed, the fee always remains the same.
• Assets under Management fees. This tends to work better for those with significant assets. In this method, the advisor charges a nominal fee based on the total value of all assets under their management. For example, they might charge a .75% fee on the total value of the assets under management (which will likely fluctuate over time). Just like the wrapped fee structure, these fees are all-inclusive—there are no other fees paid directly to the advisor.

No matter one's situation, a wealth management advisor and firm can help. The sooner one can start working with an advisor to implement a plan, the more likely they will be to meet (and exceed) their goals. Contact a wealth management service for more information.

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