Published by Paul West
You can’t get to your destination if you don’t know where you are going.
What is asset management? When you think about asset management, most people immediately think it’s all about how a wealth advisor invests your money. The advisor has many choices of solutions (stocks, bonds, funds, ETF’s, etc.) that they can apply financial planning advice and a disciplined process to investing the client’s money.
However, the important destination for clients to consider is what plan will help provide clients confidence. That is, if they look at the end and work backwards, what do they want to accomplish and what do they want family to remember when their time on this earth is no more.
To calculate what the right long-term investments are for clients, we must first think about the appropriate amount of risk they even need to take, or can emotionally handle, to make sure they accomplish their life’s goals. We call this important number the Family Index Number. To provide strategic wealth management to clients, we must consider this in our decisions.
Before we make decisions about asset management, and the choices we need to make with regards to portfolio selection, we spend time with our clients educating them on how the Family Index Number helps them live a fulfilling life. Why should they take more risk with their long term investments than they need to? It’s not about competing with the Joneses. High net worth investing involves identifying the right financial goals and objectives for each individual and their family to create a personal financial plan.