6 Elements Of A Good Wealth Management Plan

29 September 2020
 Categories: , Blog


Wealth management is more than just choosing what stocks to invest in. It encompasses a broad range of methods, goals, and tools to ensure not only that you keep the money you've earned but also that it works hard to grow on its own. To help you better understand your own wealth management needs, here are six key elements of managing your net worth.

1. Growth. Certainly, your stockpile of assets should continue to work on its own. Your management pros should grow your money with strategic choices of stocks that are likely to grow their overall value, options for investing in new ideas or companies, and good rates of return on investments. 

2. Stability. You don't want to focus on adding money so much that you put at risk what you already have. Stability is ensured by using an appropriate mix of bonds and other safe investments to balance out risk as well as investing in established — even boring — companies that pay good dividends. It may also involve hard assets like real estate to guard against market fluctuations. 

3. Insurance. Insurance is another element of stability. It literally focuses on making sure an emergency or accident doesn't reduce your portfolio. Proper insurance should be customized to each investor and often covers things like real estate, health, life, valuable personal property, business interests, and loss of income. 

4. Estate Planning. Managing your money should extend beyond your lifetime. Who relies on you for support? What legacy do you want to leave? Who will manage your assets and decisions if you become incapacitated? These elements are part of good estate planning. This generally always calls for a will and proper beneficiary arrangements, but it may also require trusts and other special-purpose entities.   

5. Income. Your own income — through business activities, passive activities, or salaries — should always add to your financial assets. Income levels change over the years, of course, but income should cover your daily activities without tapping other sources on a regular basis. 

6. Goals. There's little point in working to grow your net worth or make estate plans if you don't know what your goals are. Goals give financial planning a structure and an end target. Goals should be in three categories: short-term, mid-range, and long-term. 

As you see, wealth management is a 'big picture' plan that takes into consideration your need to protect what you have, grow your assets, and craft goals that make you satisfied. Want to learn more about financial planning? Start by making an appointment with wealth management planning services today.