As you progress through life your financial wants, needs and priorities
will evolve. In fact, early in your career, you will be focused on accumulating
as many assets as you can, within your
scope of employment or business ownership. But as your working years draws to anend, your retirement will call for a precise
and methodical distribution of your wealth, to protect you and your family.
But preciselywhat is the meaning of Wealth Management ?Is it merely investing your funds in a financial
product and expecting to earn a return on that investment?
As far as what is the Wealth Management ,
also known as private wealth management definition goes, it is defined as
a practice that combines personal
investment management, financial advisory and planning disciplinary which will
financially benefit high networth
clients. By opting for a goal-based
approach to financial planning and mapping your goals with fixed lifecycle
stages, you will gain an an in-depthanalysis
of how your financial investments now
will impact your standard of living and investments in the future.
As you can see, there is more to what is the meaning of Wealth Management, and this is where the lifecycle of private wealth management will play an important role.
Each lifecycle, also classified as age groups, will have its own unique financial needs. By using the goal-based approach to planning, your wealth
management advisor will help you analyse and be aware of the financial tools, products and strategies
available to help build and manage your wealth with the changing timeframes,
risk tolerance and the end goal. They will also assist in laying the foundation
for the next ‘lifecycle’ stage, where you can preserve and transfer your
wealth.
Early career: Early career
phase clients, between ages 25 to 35 years, have the perfect opportunity to
start building a foundation for a secure
financial future. This is also the time,
where there is an accumulation of required assets, such as investing a home, or planning to start a family. While you
may be keeping an income in step with your expenses may be a challenge, it is
also an important step to lay the groundwork for your retirement saving now.
Career development: Between ages 35
to 45, the earning will rise to its peak level. However, at the same time, the
financial demands will also increase. Your primary
concern will be covering educational costs and payongoing
expenses. But at the same time, you can start diversifying your investment
portfolio to include stocks, bonds, property and insurance amongst many others.
With the guidance of your wealth management advisory, you will be recommended with the best plan that will
help you manage your current assets or align your tax and debt structure to
best meet your financial goals.
Peak
accumulation:This is the stage between the ages of 45’s to the
60’s. In this stage, you will reach your
maximum income level. It will also provide financial opportunity to accelerate
savings and investment savings, due to the ‘empty nest’ phase, where your
children will be independent and lower expenses where all your debts are paid
off. Here is the time to analyse your current investments and evaluate your
financial retirement plan distribution options. You can focus on reconstructing
your portfolio assets to reduce risk and increase income.
Retirement:The
final financial lifecycle phase occurs around mid-60’s. Here the focus will now
shift from wealth accumulation to income preservation. Here, wealth advisors
will assist you to preserve your purchasing power and enjoy your desired
lifestyle. You will also be recommended to plan out your legacy considerations
and even your estate plannings.
By now, you may
have an idea of what is the investment
management definition and how the lifecycle stages will be applicable to
you. With the right wealth management assistance, you will now invest in a
personal and secured financial future, that will suit your needs.
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