What is Personal Wealth Management and What Are Its Benefits?

financialtreat – will explain about What is Personal Wealth Management and What Are Its Benefits? which you will find in the following article. let’s look at this article carefully!

Personal wealth management is an investment consulting practice that combines financial planning, portfolio management, and other combined financial services for individuals, as opposed to corporations, trusts, funds, or other institutional investors.

From a client’s perspective, personal wealth management is the practice of solving or improving their financial situation and achieving short, medium and long term financial goals with the help of a financial advisor.

What is Personal Wealth Management and What Are Its Benefits? Let’s find out the explanation here

From a financial advisor’s perspective, personal wealth management is the practice of providing clients with various financial products and services, so that those clients can achieve certain financial goals.

What is Personal Wealth Management?

Personal wealth management is especially useful for high-income individuals. Several types of institutions, from large banks to small family offices, provide personal wealth management. Personal wealth managers generally charge a small fee based on the assets under management.

Understanding Personal Wealth Management

Some individuals may lack the time, energy, or knowledge to manage their own finances. So they seek advice from wealth managers who specialize in managing personal finances, often high net-worth-individuals (HNWIs).

HNWIs have a unique financial situation that requires greater diligence and a higher level of active management. HNWI requires a more holistic approach to investment management than many financial advisors can afford.

HNWIs can have problems with income tax, estate planning, investment management, and other legal issues that require more attention and specialized expertise than traditional investment advisors can provide.

Types of Personal Wealth Manager

Personal wealth management services may be provided by major banks and brokerage houses, independent financial advisors, or multi-licensed portfolio managers focused on high-income individuals, and family offices.

Many private wealth management companies are smaller groups within larger financial institutions that are focused on providing personalized services to their clients. Their main goal is to manage and grow their client assets to make available to future generations.

The group often has a wide range of advisors and expertise providing guidance across a wide spectrum of investments including cash, fixed income, equity and alternative investing. They can create asset portfolios that meet investors’ risk tolerance while offering growth opportunities.

Some HNWIs may want to consider opening a family office. Family offices provide more services tailored to meet the needs of HNWIs. From investment management to providing charitable advice, family offices offer total financial solutions for high net worth individuals.

There are two types of family offices: Single-family offices support a single individual or wealthy family, while the more common multifamily office supports multiple families and individuals. Multifamily offices are more prevalent because of economies of scale that allow cost sharing among customers.

And according to another opinion, here are some types of personal wealth managers. Wealth management is divided into three types, namely:

  • Wealth Protection and Preservation – focuses on protecting family assets and assets. Protection is carried out to avoid a reduction in value so that the amount of wealth and assets is maintained in quality and quantity.
  • Wealth Growth and Accumulation – aims to grow the value of existing assets and wealth. In order to continue to grow, wealth and assets must be processed and managed properly.
  • Wealth Distribution and Transition – aims to distribute assets to other parties. If there is a problem during the wealth distribution process, you can consult directly with the wealth manager.

How Private Wealth Management Works

Most private wealth management companies are fee based. They charge their clients a percentage of the assets under management. HNWIs may believe that fee-based financial advisors have fewer conflicts of interest than traditional commission-based advisors.

Commissioned advisors can push investors into front-end and back-end load mutual funds that charge significant commissions, in most cases without offering better performance than no-load funds.

Advances in technology have allowed many of the larger financial advisory firms to provide online services at lower costs. Although many investors attracted to this type of service, many HNWIs still want a more personalized approach to their finances, even with the additional costs associated with it.

Wealth Management Strategy

Before joining Indonesia’s wealth management program, be sure to learn the following strategies.

Trust Fund – a wealth protection strategy by entrusting wealth to safeguard its benefits. Trust funds are almost similar to wills. The difference is that people who are trusted to manage must maintain assets or wealth so that their value does not change and routinely report on fund management. Generally, trust funds are managed for social activities, such as building foundations, orphanages, and disaster grants.

Insurance – one of these wealth management products protects wealth and assets according to the needs of its users. Starting from health, education, body, to life. Hedge Fund – this strategy is carried out by depositing funds to the Investment Manager (MI) to be managed and invested in certain companies according to the agreement.

Investment Management – ​​this strategy is carried out by entrusting funds to the Investment Manager to be managed so that their value increases. Estate Management – ​​this strategy aims to manage inheritance so that it is right on target. Business Venture – this somewhat risky strategy is done by providing funds to new businesses. If the business is growing rapidly, the return on investment is greater than the initial capital.

How to Register Wealth Management

Prepare the necessary documents, such as legal identity and other documents needed to fulfill administrative requirements. Visit the nearest bank that offers wealth management services.

After filling out the registration form, the bank will verify the data and required documents. If the verification is successful, you can start a financial management plan as needed.


After knowing what the types of services of wealth management are, the next is the benefits of wealth management. There are five benefits that will be obtained if you use financial advisory services, which are as follows:

1. Easy to Conduct Financial Evaluation

The first benefit is that it is easy to carry out financial evaluations. The advisor will usually provide a questionnaire that must be filled and in it there are questions. The questions are about financial goals, risks, profiles, debt, revenues and expenses.

The existence of this questionnaire will help the owner to know the inflows and outflows of his own finances. By conducting a financial evaluation, the owner will find it easier to increase income and minimize expenses.

2. Preparing Old Age Finances

The next benefit is as a preparation for old age. Financial security in old age is everyone’s hope. Therefore, the first step that can be taken is to ask for the help of a financial advisor to manage finances.

Together with a financial advisor, you will be invited to calculate how much funding is needed in old age. Then these calculations can be used for making financial decisions to make it easier and more economical.

3. Achieving Goals

The next benefit of wealth management is that it is easy to achieve goals. For example, if you are still alone, you definitely have the desire to get married, right? Then after getting married, what you think about is buying your own house.

Then after having a family, you definitely want to prepare funds to give birth to children. All of that must be carefully planned with a financial advisor. To realize all these dreams, it is important to do wealth management.

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4. Protect Yourself

The fourth benefit is to protect yourself. Protecting yourself means preparing financially if you experience a disaster in the future. The importance of having an emergency fund to prepare everything. You can also use insurance for the future.

5. Embrace the Habit of Investing

The fifth benefit is to get used to making financial investments. Saving and investing are habits that must be instilled early on. However, not everyone can do this.

In fact, to get financial security faster by using this method. Together with a financial advisor, you will get information about investments. With the information obtained, it will also be easier to make decisions.

That’s a little explanation about private wealth that you need to know, hopefully this information can help and also add to your insight. Then, after reading this info, are you interested in registering in wealth management? Good luck!

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