Steven Tenney, Great Diamond Partners.
As a business owner, you work hard to build your wealth and achieve your financial and personal goals. You understand the importance of strategic financial planning and prudent management of your assets. However, with so many options available, it can be overwhelming to decide on the right wealth management firm to partner with.
As the co-founder of an independent, advisor-owned wealth management firm, I’d like to draw on my experience with a variety of firms to provide you with six key elements to look for when hiring a wealth management firm.
1. Investment Management
The most obvious of the core functions of a wealth management firm is investment management. Partner with a firm that has a strong process and discipline for managing your investments. Make sure they have a distinct investment philosophy that is in line with your objectives and risk tolerance as well as an awareness of all the factors affecting your situation.
Additionally, it’s important to look for a firm that offers a diverse range of investment options, including both traditional and alternative investments. A well-diversified portfolio can help mitigate risk and maximize returns.
2. Wealth Protection
Wealth protection is an essential part of any comprehensive financial plan. Unforeseen events like a car accident may result in a lawsuit that can quickly impact your wealth. Your firm needs to understand the importance of protecting your assets. First, they should understand your situation and have knowledge of the many common risks. Second, they should collaborate with insurance and legal experts to identify comprehensive risk management solutions, including insurance coverage for your personal and business assets.
3. Tax Mitigation
Taxes can also have a significant impact on your wealth. Your firm should understand your situation and partner with a CPA who understands the intricacies of the tax code. Their approach should be proactive and focus on after-tax results in their recommendations. Strategies may include tax-efficient investment vehicles, tax-loss harvesting and estate planning techniques.
4. Estate Planning
Estate planning is essential for ensuring that your assets pass to your desired beneficiaries in the way you want. This could include your family and favorite charities. Look for a firm with experience in a variety of estate planning techniques and one that partners with estate planning attorneys who can provide the technical expertise and drafting of documents.
Often, an estate plan includes a will, trust and other legal documents. The estate plan should also be regularly reviewed and updated to reflect changes in your financial situation and personal goals. Your wealth management firm should play a proactive role in this update process.
5. Charitable Giving
Charitable giving is an important component of many wealth management plans. It often goes to the heart of what’s important to your family and plays a technical role in tax mitigation and estate planning. Look for a firm that can help you understand your desires and help those dreams come alive in the most tax-efficient manner possible. Common solutions include donor-advised funds, foundations and charitable trusts.
6. Relationship Management
Finally, relationship management is essential. Partner with a firm that takes a proactive and responsive approach to engaging with you and your family. Your lead advisor should have a deep understanding of your financial objectives and be able to provide personalized advice that is tailored to your unique situation.
It starts with a deep discovery process and continues as long as the relationship lasts. Regular, proactive communication will be fueled by transparency and regular updates on your portfolio and financial plan. Not to be overlooked, you should also have frequent contact with the client service team that handles most administrative issues.
In conclusion, hiring the right wealth management firm is a critical decision for any business owner. Look for a firm that includes aspects like a strong process and discipline for investment management, expertise in tax mitigation and a culture of proactive relationship management. By partnering with the right wealth management firm, I believe that you can better achieve your financial goals and build a strong foundation for your future success.
Great Diamond Partners, LLC is an investment adviser in Portland, Maine, registered with the Securities and Exchange Commission (SEC) and only transacts business in states in which it is properly registered or is excluded from registration. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the SEC. The information provided here is for informational purposes only. Nothing provided herein constitutes tax advice. Individuals should seek the advice of their own tax advisor for specific information regarding tax consequences of investments
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