Saving for retirement or for some other wealth management goal might seem as simple as taking advantage of your company’s 401(k) plan, transferring a portion of each check to an individual retirement account (IRA) of some kind, and maybe throwing a few bucks in savings when you have an opportunity.
Quite frankly, that’s a better plan than many people have in place already. But, if you truly want to make the most of your money so you can reach your short-term goals faster and be better prepared for your long-term goals—such as retirement—wealth management firms can provide the guidance and expertise you’ll need backing you.
Take the scenario above, for example. Putting money into an IRA that provides a tax-deferral benefit (either up front or at the time of disbursement) is a fantastic idea. However, it’s an automatic thing that you can deduct from your salary as a payroll deduction or make a lump sum contribution to at the end of each year, and that’s it. It doesn’t take into account market fluctuations, low-risk/high-interest opportunities, or anything else that will boost your wealth management potential.
Wealth management firms, on the other hand, have years of experience in the field of finances. Their job—what they go to day after day just like you do—is to find the best ways to manage your money. It’s not a “set it and forget it” scenario like an IRA contribution. They constantly monitor all of the different conditions and opportunities needed to move your forward.
The next question then is how do you choose one wealth management agent or firm over another? Instead of looking at the three approaches that the industry uses in valuating one business over another—which would be asset, income, and market approaches—let’s look at this on a more personal level. Here are some things you should look for when doing research on choosing a wealth management firm:
- Fees. Is the firm commission-based or fee-only oriented? Typically, commission-based agents are paid when you make transactions. Fee-only advisors tend to provide more comprehensive advice when it comes to your overall financial picture.
- Size. Large firms have the advantage of a deeper roster of seasoned professionals with a wider range of financial knowledge. However, small- to medium-sized firms have a tendency to provide more personalized service. Look for a good balance.
- Clients. Seek a wealth management firm that has a recurring client base. In other words, a place where people continue to bring in their repeat business. If the clients weren’t satisfied with their service or results, they wouldn’t continue to go back.
- Product Mix. Look for a team that can handle all of your financial needs, not just a broker helping you to make investments. In addition to wealth management, a good wealth management firm should also be able to assist you with retirement planning, financial planning, and legacy options for your family in the event of your passing.
Tull Financial Group 