Wealth Management vs. Financial Advice: They’re Not the Same
Taxes, estate planning, charitable giving: Your financial life is complicated. A wealth management team will help you with much more than just your money.
![](https://cdn.mos.cms.futurecdn.net/gpqUJ2FjSuJLkk38qCvYbh-415-80.jpg)
These days, there are so many terms used to describe what financial professionals do – advising, coaching, consulting, planning, guiding, managing, etc. – none of them seems to hold much meaning, for investors or those in the industry.
And that’s a shame. Because there is a difference.
Wealth management is one of the terms that is most overused, and it’s often misunderstood. But it’s actually pretty straightforward. Wealth management takes things up a notch, with an adviser or advisory team providing a full range of services for the client in three distinct ways.
![https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-200-80.png](https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-320-80.png)
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
1. Investment consulting
You probably see ads and hear pitches every day from individuals and companies who want to sell you investment products. Some do it better than others. Although any licensed adviser can help you on this platform, a good wealth management team can provide a wide variety of options to choose from.
2. Advanced planning
This is where a wealth manager really differentiates himself. Few advisers do this type of planning, which includes:
- Wealth enhancement: This is the use of strategies to deal with cash-flow issues and liquidity concerns, mitigate taxes and maximize growth.
- Wealth transfer: Advisers look for the most efficient ways to pass your wealth on to your heirs in a way that lets your beneficiaries keep most or all of the money.
- Wealth protection: For those who are subject to a lot of liabilities, there are strategies that can help protect hard-earned savings and avoid any blind spots.
- Charitable giving: With proper planning, donating to a charity or charities can be a win-win, maximizing support for a favorite cause while making the most of certain tax advantages.
3. Relationship management
This is about building a trusting partnership that goes beyond the basics, thoughtfully connecting with clients and their needs in two ways:
- The client relationship: Through a careful discovery and review process, the adviser can see where clients are now and where they want to go, and look for any gaps that might exist.
- A professional network relationship: A top-notch advisory firm will build a team around each client to help with all kinds of issues. It could include a CPA, an estate-planning attorney, a property and casualty expert, a long-term care consultant or some other professional. And, if the client already has some of these experts in place, the team will communicate and work with them to further enhance their efforts.
A wealth manager’s No. 1 aim is to find out what’s important to you and provide financial solutions. If you’re looking for a full-service, collaborative approach to reaching your financial goals – now and in retirement – an adviser who practices true wealth management could be just the right fit for you. I typically suggest talking with your friends and family and get a referral that way. When you sit down at your first meeting, ask questions.
- What does their typical client look like?
- What net worth are they used to working with?
Wealth managers should be able to help with tax-reducing strategies, preparing an income plan, maximizing Social Security and making sure estate-planning documents are in order.
Securities offered through GF Investment Services, LLC. Member FINRA/SIPC. Investment Advisory Services offered through Global Financial Private Capital, LLC. California Insurance License #s 0B34918
Kim Franke-Folstad contributed to this article.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
David Kanani is the president of Kanani Advisory Group. He has passed his Series 7 and Series 65 securities exams, and is also licensed to sell life insurance and annuity products. He holds a bachelor’s degree in business administration from the University of Louisville.
-
Visa Is the Worst Dow Stock Wednesday. Here's Why
Visa stock is down sharply Wednesday after the credit card company came up short of revenue expectations for its fiscal Q3.
By Joey Solitro Published
-
Another Analyst Moves to the Sidelines on Tesla Stock After Earnings
Tesla stock is spiraling Wednesday after the EV maker's big earnings miss and Wall Street has been quick to weigh in. Here's what you need to know.
By Joey Solitro Published
-
Confused by Annuities? Making Sense of the Different Types
Many investors aren't sure if annuities are a good option for meeting financial goals. Let's look at the different categories, along with their pros and cons.
By Kris Maksimovich, AIF®, CRPC®, CPFA®, CRC® Published
-
Talkin' 'Bout My Generational Wealth: Baby Boomers
With retirement, each generation has different priorities and challenges. For Baby Boomers, it's a matter of ready or not, here it comes.
By Alvina Lo Published
-
How to Avoid a Big Hassle if Your Financed Car Gets Wrecked
How an insurance check is made out for repairs can cause a world of problems if the lienholder is left out.
By H. Dennis Beaver, Esq. Published
-
Estate Planning Strategies to Consider as Election Nears
Are big changes in tax laws coming soon? Not likely, but you might want to take advantage of higher estate and gift tax exemptions well before the end of 2025.
By David Handler, J.D. Published
-
How to Get Your Money's Worth From Your Financial Adviser
A good financial adviser will focus on how your financial planning and investment strategy align with your lifestyle and aspirations.
By Pam Krueger Published
-
Think of Prenups and Postnups as Financial Planning Tools
These contracts provide a clear framework for asset management and protection and are especially useful if you get married later in life.
By Andrew Hatherley, CDFA®, CRPC® Published
-
Congratulations on Your Raise: Three Things to Do With It
We're not saying you shouldn't spend it on a new car, but there are some considerations to guard against lifestyle creep and to help ensure a comfy retirement.
By Andrew Rosen, CFP®, CEP Published
-
Check Off These Four Financial Tasks to Finish 2024 Strong
The new year is a popular time to set financial goals, but now is the ideal time to check how you're doing. Four tweaks could make a big difference.
By Daniel Razvi, Esquire Published