Wealth management is a comprehensive and holistic investment process that integrates the long-term goals of an individual with financial solutions, using consultative approach. However, many advisors don’t spend the time to really understand their clients’ goals and dreams.
They don’t incorporate important pieces of information into a comprehensive plan designed to achieve goals within a reasonable time. Our wealth management business was established with the primary objective to help our clients share their financial fears and goals; and to help them achieve these goals. We offer a variety of different financial products and services that are all related to the clients’ total financial situation.
A well-crafted financial plan
Developing a formal document that lays out a client’s financial plan is an important aspect of our wealth management process. The value of the plan is that it takes the intangible process of financial planning and makes it real. You can read it, understand it, refer back to it, and share it with family members and friends. It is also very important for the wealth manager so that she can reference the plan during review meetings and put the plan’s performance into a long-term context. But wealth management actually goes beyond the client’s investments. The goal of every wealth manager is to be the “Chief Financial Officer” of their client’s entire financial life. This work extends to estate, retirement and risk planning.
A conversation approach to planning
It is important for our wealth managers to develop a strong relationship with a client; that provides us with a deep understanding of your life journey. At its heart, developing a plan is a conversation between a wealth manager and a client. Our objective is to have longer conversations to gather as much information about the client as possible. Through deep meaningful conversations, we are able to discover the client’s goals, dreams and past investment experiences.
Important considerations when creating a plan
By discussing all aspects of the client’s financial life during the discovery and planning meeting, we identify specific activities we must focus on as we move the client closer and closer to their goals. Some aspects to consider:
It’s often said that many people spend more time planning a two-week vacation than they do on their investment plan. The investment planning process should result in an estimate of the return needed to accomplish an investor’s objectives, taking into account that client’s unique goals, time horizon, current asset base, tax sensitivity, and risk tolerance, among other factors.
Planning for your retirement is not something to be taken lightly. This is because your retirement savings are probably your biggest asset. So you need to be aware how your choices now will affect you later in life. When you retire you are faced with a bit of a problem; it is not easy to reverse the choices that you made earlier in life. With careful planning, a commitment to saving and an understanding of your options, you can achieve a financially secure retirement.
Risk planning is necessary both to protect your assets and to provide for your loved ones after your death. It can involve the protection and proper management of your wealth in case of death, disability and illness. It allows your family to face life without the added pressure of financial burdens. If you already have a risk solution, our wealth managers can assess the suitability of your existing death, disability and dread disease provisions and quantify the level of any possible shortfall.
Tax planning is the art of arranging your affairs in ways that postpone or minimise taxes. This is done to align your financial goals and objectives with a tax efficient plan. A wealth manager will assist you to meet all elements of your financial plan in the most tax efficient manner. The main objective for tax planning is to apply the current tax laws to your financial situation, in order to reduce your taxable income for the period.
Having a Will and planning to protect and preserve your wealth is one of the most important things that you will ever do. Effective estate planning means that you retain the maximum amount of wealth possible for your intended beneficiaries. Or, you may have a large estate, and minimizing any potential estate tax impact is your primary goal. Here, you will need to use more sophisticated techniques in your estate plan, such as a trust.
A classic “win-win” situation for clients
Today, clients are not looking for salespeople; they are looking for the most competent advisors who are committed to their financial success. Starting a client relationships with a well-thought-out plan can not only ensure that clients will be in the best position possible to meet their long-term financial goals but can also form the basis for future plan review conversations.
We firmly believe that wealth management can only add value if, and only if, it’s relevant to the personal needs of the client. We aim to recommend financial products that offer clients value for money. We therefore make product decisions with the long-term welfare of our clients in mind.
Thandekile started out at Inkunzi Wealth Group as a graduate trainee in the Client Advisory Centre before moving to wealth management. Thandekile is responsible for providing comprehensive financial planning and assisting our clients pursue their wealth management goals. She holds a BCom degree in Finance and has also completed her BCom Honours in Financial Planning through the University of Johannesburg.