Hiring the “Right” Wealth Management Officer: A Brief Guide
When you have to build an investment portfolio geared towards specific financial goals, you may need professional help. That’s exactly why we have family wealth management firms in India. However, as not all wealth managers are equal, you need to consider multiple elements before hiring one. The blog discusses some of the points that you need to consider that will help you hire the “right” professional.
Check Credentials
It goes without saying that you’d want to learn more than a few facts about your potential wealth manager. Before you inquire about whom they’ve worked with in the past, ensure that they are a Certified Financial Planner or CFP. Hire a wealth management firm that has earned recognition and rewards, as such companies are more likely to employ qualified and experienced professionals. All in all, don’t hesitate to ask about everything from the referrals the officer can provide to the meaning of a certain certification they have earned.
Look for Investment, Not Relationship Expertise
Many investors assume that their advisors are investment experts. The truth is many wealth officers are primarily relationship managers. They merely suggest and recommend products, and the company they work for doesn’t judge them on how well their suggested investments perform, but the number of investments. What’s important to note is that even CFPs are not required by law to suggest investments that are in your best interest — known as the fiduciary standard. That’s why it’s essential to ask your potential wealth manager if the law abides them to act in your best interest.
Mind the Value, Not Price
As they say, the price is what you pay, and value is what you get. That teaches us one good lesson — never fixate yourself on the “price” when hiring a wealth management officer. Rather, find out about the services they can deliver, and in what ways can they help increase or preserve your wealth. Simultaneously, ask the advisor about their ideal client. If the description doesn’t intrigue you — match your ideals — the wealth officer may not be an ideal fit.
Word of Advice
Wealth management officers, whether in India or any other country, charge either on a commission basis or a set fee. Ideally, you need to look for an officer who sets their fee based on the size of your investment portfolio, and not for the number of products they sell. The reason is the first category is more likely to be geared towards your personal interests. Simultaneously, seek a family wealth management firm that provides other services such as estate planning, financing, real estate advisory, and more.