November 16, 2023

Understanding High Net Worth Asset Management

The number of people in North America considered millionaires more than doubled between 2010 to 2020, which has fostered the need for highly trained financial advisors experienced in the nuances of wealth management services. The more assets a client has — and the greater the value of those assets — the more qualifications the asset management team must bring to the table. 

For example, high net-worth individuals (HNWIs) may not worry as much about Social Security planning or creating an elaborately detailed budget to ensure they get through their Golden Years. Still, high-net-worth individuals may remain concerned with inflation or how future tax law updates might affect their wealth — a great example of one such tax law update affecting wealthy families is the estate tax, also known colloquially as the death tax. HNWI investors might be financially “set,” but some may still follow the peaks and valleys in the stock market and of the economy as a whole, and they expect no less from their asset manager. Other HNWIs may prefer a more hands-off approach and trust their wealth management team to keep tabs on their advanced portfolios.

What is a High Net Worth Individual?

There is no legal definition of a high-net-worth individual. In the financial industry, however, advisors consider anyone with at least $1 million in liquid assets a HNWI. A study in 2021 discovered 11.6 million households in the United States fall into this category, up from 11 million in 2020.

Building Better Client Relationships

High-net-worth asset management teams should have knowledge of a variety of asset classes. An experienced asset management team knows the value of understanding a client’s financial wants and needs. Understanding asset classes and a client’s desires helps financial teams prepare unique strategies according to each investor, which helps build solid client relationships on a foundation of trust.

Creating High-net-worth Investment Strategies

A personalized approach to investing, led by an experienced asset management team, is essential for high-net-worth individuals. These individuals often have complex financial situations and require tailored high-net-worth investment strategies that aim to maximize their profits while safeguarding their wealth and achieving their financial objectives.

Therefore, asset managers must understand their client’s unique financial goals, risk tolerance, and wishes, so they can sift through the countless investment options and devise a selection of high-net-worth investment strategies for their client to select from.

Adapting to Client Interests

People come from a variety of backgrounds, and regardless of how long they’ve been considered HNWIs, they have varied interests, financial needs, and desires. Experienced asset management advisors individually adapt to each client, taking the time to learn a client’s interests and using this information to conduct research. This research then assists in choosing the high-net-worth investment strategies they present to each client. 

By catering to the specific needs of their client and diligently researching potential opportunities, asset managers can deliver strategies that are tailored to aim to  generate profits while mitigating risks. This personalized approach, not only builds trust between the investor and the asset manager, but also enhances the overall investing experience and aims to increase the likelihood of achieving long-term financial success.

Other Financial Services Offered to High-Net-Worth Individuals

High net worth asset management is much more than choosing the right investments. High net worth asset management is a holistic approach to personal finance that may include:

Estate planning

Preparing your affairs prior to passing away is an important aspect of financial planning. This is especially true for HNWIs with significant estates they’ll leave to family, friends, and charitable organizations. A wealth management team, working with an Estate Planning attorney, can provide estate planning guidance and help to ensure  clients’ wishes are met and that assets are divided in the way they intended.

Risk analysis

A wealth manager is an objective party that can help clients see their overall financial status and help evaluate potential investments. Risk analysis offers clarity for high-net-worth investment strategies.

Net worth analysis

Sometimes, a high-net-worth individual may not even realize their true wealth. Without a clear-cut financial picture, it’s impossible to craft an investment strategy in line with an HNWI’s needs, which is why a high-net-worth asset management team may conduct a net worth analysis.

Legacy planning

Like estate planning, legacy planning seeks to preserve what you leave behind. But legacy planning is about preserving your intangible assets — your life’s work, for instance — for future generations.

Tax planning

Some HNWIs may have earned the status through a windfall, like an inheritance  , but typically become a HNWI through employment in a lucrative career — and higher income means higher income taxes.

However, earning more doesn’t mean you have to pay more than your fair share. Working with a CPA, HNWI tax planning helps high-income earners aim to maximize their tax deductions, harvest losses, and find other applicable tax breaks. Tax planning can help HNWIs save on taxes, but it should be noted that asset management fees and other fund expenses can also affect a client’s returns.

Charitable giving

A high-net-worth asset management team can help clients find charitable organizations or investments aligned with client interests, such as cancer research, animal welfare, homeless population assistance, or other causes close to a client’s heart.

Finding the Right High-Net-Worth Asset Management Team

To find a high-net-worth asset management team most closely aligned with your financial goals:

  1. Learn what services are available and what each service offers.
  2. Figure out the services that make the most sense for you.
  3. Decide how much of your budget should go towards a financial asset management team.
  4. Hold interviews with several high-net-worth asset management teams.
  5. Obtain and review each team’s accreditations. *

* Investment Advisor Public Disclosure (IAPD) lists financial advisor accreditations.

Contact Churchill Management Group for Your High Net Worth Asset Management

High-net-worth individuals deserve attentive care from an experienced asset management team. Schedule a consultation with Churchill Management Group for your high-net-worth asset management needs.

Financial Planning Services

Churchill provides financial planning services to Clients that specifically engage Churchill for that service. The planning can include defining goals, designing a plan, assisting with implementing the plan, and evaluating and adjusting the plan over time, at the request of the client. The financial planning includes advice regarding securities investing, and may include discussions of a client’s tax, insurance, employee benefits, estate planning and other issues. Churchill, however, does not provide legal, insurance, employee benefit, estate planning, tax or accounting advice, and the client must rely on legal, insurance and accounting professionals for that advice and documentation.

To review our privacy policy and your rights please click here.

To review our Terms of Use, please click here.