Many people who acquire sudden wealth lack the time and natural talent to manage their finances on their own. They need wealth professionals from Innova Wealth to help them navigate new challenges and opportunities.
You don’t have to be a multimillionaire to need wealthy management services, but you do need more than just investing advice. Learn more about what a wealth manager does, and whether they are right for you.
Financial Planning
Financial planning is a process of creating a plan to reach your monetary goals. This includes making a budget, building emergency savings, and reducing debt. See the article : Financial Advisor. It also includes setting up retirement accounts and long-term savings plans.
At the initial stage, individuals may not require wealth management as they are yet to accumulate significant financial assets. Nevertheless, financial planning is required by everyone. It involves making decisions like how much to spend and how much to save, calculating whether a loan is required etc.
A financial planner can help you avoid common mistakes that can be costly, such as accepting an executive compensation plan without a thorough review (resulting in company stock overconcentration or taxes) or claiming Social Security at an inopportune time (thereby pushing yourself into a higher tax bracket). He or she will also help you implement effective strategies for tax minimization and asset transfer. Moreover, he or she will offer investment and advisory services under one umbrella, thus providing you with the best possible solution for your unique situation.
Investment Management
Investment management is the part of wealth management that handles the buying and selling of financial assets. This includes equities, bonds, and other fixed income investments. See the article : What Is a Financial Advisor?. Investment managers are specialists in this area and they work with companies, government agencies, and individuals to manage their investments.
They help you determine your risk tolerance and make recommendations about which investments to purchase. This is typically done through targeted analysis with tech-powered tools. They also provide you with alternative options that are beneficial to your goals and align with your personal investment approach.
A wealth manager can also assist you with retirement and 401K planning. Their extensive knowledge allows them to develop a strategy that will help you pursue your future objectives without hindering your current lifestyle. Similarly, they can use their expertise to help you minimize taxes by using tax breaks, classifications, and strategies that comply with the tax code. This is a highly critical component of wealth management.
Tax Planning
Whether you want to drive growth, provide income, or preserve wealth for the next generation, taxes have a significant impact on your ability to reach your goals. Tax planning is the process of legally reducing your tax liability through deductions, credits, and incentives. It is not something that happens only at filing time; it requires consistent monitoring and planning throughout the year to minimize your tax liability and make the most of your assets.
Without it, investment returns can be eroded by taxes and other expenses. It is an integral part of a comprehensive wealth management plan. Our advisors can help reduce your tax liability by using strategies such as asset location (putting your investments in the right accounts – 401(k), IRA, Roth, HSA, brokerage) and tax loss harvesting. Tax planning also includes the use of charitable trusts, private foundations and donor-advised funds. We are committed to helping you take advantage of all opportunities to optimize your tax status.
Estate Planning
A financial planner can help you plan your estate and prepare for incapacity or death. This may include preparing documents like a will, trusts, power of attorney, living will and healthcare powers of attorney. It can also include strategies for limiting estate taxes and making charitable donations.
As the transfer of wealth to millennial and Gen X inheritors begins, effective digital strategy has become important for wealth management firms. Startups like Vanilla, a disruptor in the wealth tech space, offer tools for estate planning with automated reports and easy-to-understand visualizations for clients.
When choosing an estate advisor, look for someone who can explain each element of a wealth management process in clear terms and pinpoint why it’s necessary. A good advisor can also explain complex estate strategies to non-experts in a way that’s accessible and understandable.