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5 Must-Do Moves for Choosing a Wealth Management Firm

If your portfolio is too large for you to handle on your own, it may be time to call in a professional. Wealth managers work with their clients to identify financial goals and map out a plan for achieving them that’s built around choosing solid investments that’ll grow over time. If you’re ready to build serious wealth, here are some tips to help you choose the right wealth management firm.

1. Get a Feel for Their Ideal Client

In general, wealth management firms cater to investors who have a sizable asset base but they don’t all take the same approach. Some wealth managers may prefer to work with clients who have between $50,000 and $500,000 in assets while others might exclusively target millionaires. Asking a wealth manager about the kinds of clients the company works with can give you a sense of where their expertise lies and whether that coincides with what you’re looking for.

2. Compare What They’re Selling

If you’re on the hunt for a wealth manager, you may already have a clear idea of what you need them to help you with. If that’s not the case, it’s important to consider what kinds of products and services different firms offer. Does your wealth manager only offer investing advice or does the firm also assist with things like taxes or estate planning? Some firms may specialize in certain types of investments or strategies. For instance, LaSalle Investment Management focuses exclusively on real estate investments.

It’s also a good idea to pay close attention to the firm’s overall investment strategy to make sure it aligns with your goals. If you’re considering several different firms and they’re all offering the same cookie-cutter portfolio options, that’s a sign that you may need to look elsewhere.

3. Check out the Pricing

5 Must-Do Moves for Choosing a Wealth Management Firm

Wealth managers can help you increase your wealth but they don’t work for free. There are two basic ways that wealth managers get paid: by charging commissions on the products they sell or assigning fees to specific services. If you’re not interested in being bombarded by a sales pitch every time you meet with your wealth manager, a fee-only advisor may be your best bet.

When it comes to cost, the most important thing to consider is the amount of value you’ll get for what you pay. If you’re spending a large percentage of your earnings on fees, it’s a good idea to be sure that your portfolio’s performance is worth the added expense.

4. Ask About Their Availability

While you probably don’t need to speak to your wealth manager on a daily basis, you might need to be in touch with them regularly. Asking how often they meet with their clients and how they prefer to communicate is important to ensure that you’re both on the same page. If you have concerns about a particular investment or a question about a fee, you don’t want to be left in the dark.

5. Take a Look at Their Track Record

5 Must-Do Moves for Choosing a Wealth Management Firm

Wealth management firms can have millions or even billions of dollars in assets under management, but that alone isn’t an indicator of how well they serve their clients. If you’ve zeroed in on a handful of firms, consider their past history. For instance, has the firm received any special recognition or awards? Can you find positive reviews through the Better Business Bureau or another consumer site?

Digging into a firm’s background may take a little time but it can be worth the time and extra effort if you’re on a mission to build wealth in your 20s and 30s or before you reach retirement age.

The Bottom Line

Working with a wealth manager is all about forming a relationship with someone who has a fiduciary duty to you and cares about your money as much as you do. Choosing the wrong person for the job has the potential to be disastrous, not only for you but for the next generation if you’re planning to pass wealth on to your heirs. Using our tips as a framework can make it easier to find a firm that’ll have your best interests in mind.

Our SmartAdvisor matching tool can help you find a seasoned expert to manage your wealth. It’s easy to use and only takes a few minutes. All you have to do is answer a few questions about your financial portfolio and the tool sorts through thousands of advisors to find up to three that match your goals. Then you can check out their profiles, interview them on the phone or in person and choose who to trust with your assets.

Photo credit: ©iStock.com/sturti, ©iStock.com/FlairImages, ©iStock.com/DragonImages

Rebecca Lake Rebecca Lake has been writing about the nuts and bolts of personal finance for nearly a decade. She is an expert in investing, retirement and home buying topics. Her work has been featured on The Huffington Post, Business Insider, CBS News, U.S. News & World Report and Investopedia. As a homeschooling mom of two, she's always looking for ways to make the most of every dollar.
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