What is wealth management?

Standard Chartered Bank

Nowadays, wealth management is commonly used by financial institutions to describe the various products they offer to customers.

A holistic wealth management service provider offers a complete range of wealth management (which is about managing day-to-day finances to stay better in control), wealth creation/accumulation (planning for your short- and long-term goals by using time as an ally) and wealth protection (protecting you, your family and assets so that everything you’ve worked for is not lost) products and services. Your lifestyle, demographics and financial goals will in many ways determine the type of financial solutions that you will require.

Standard Chartered Bank’s research shows that each customer has different financial requirements at different stages of his life, such as getting started on his first job, career taking off, raising a young family, getting established in the career and enjoying the prime of his life as a senior citizen. Therefore, prescribing a financial solution without finding out what the customer actually requires is like dispensing the same medicine for every health problem without proper diagnosis.

Wealth management is for everyone. Whatever your financial requirements are and whichever life stage you are at, it is essential to know that wealth management is for all, not just for the rich. Wealth covers all aspects of your assets covering cash, properties, stocks and shares, bonds, unit trust investments and so forth. Therefore, wealth management is all about managing, growing and protecting your assets.

Wealth must be proactively and systematically managed because inflation and currency fluctuation risks can take a big bite out of the value of your wealth.

1. How Does Financial Planning Work?

Careful financial planning will put you on a fast track to financial fitness, enabling you to fulfil your financial aspirations. That requires you to first gain insights into your current financial standing, ie putting on paper your total financial information that includes assets, liabilities (borrowings), future needs, earnings (current and future).

Your personal financial consultant will examine your current financial situation. For example, the consultant will assess whether you have sufficient emergency funds and your portfolio is properly diversified.

Or if a loan is weighing you down, you may be shown how to lower your repayments or offered mortgage refinancing at a lower rate. Or how an overdraft may pay off some of your short-term debts at a lower cost. And if you have idle funds, how to invest them to make your money work harder. You will then need to identify, quantify and prioritise your short, medium and long-term financial goals and the respective time horizon that you hope to realise your goals. Once you know how much you need to accumulate to finance your goals, you will need to determine the gap between what you have today and what you need in the future. The discrepancy of your financial standing will mean that a personalised financial plan will be mapped out, outlining how you can go about improving your financial wellbeing and meeting your financial aspirations.

Periodical review of your financial plan will help ensure that it remains robust and applicable to your lifestyle and family situation. Any changes in your personal situation, for example, an increase in personal income, your family size and loan commitments will require you to re-examine your financial standing and plans.

Time is essential in financial planning because the earlier you start figuring out your future needs and targets, the better you will be. There is also the magic of compounding interest. The longer the time you have for your investments to grow, the bigger the growth will be. Hence, there’s no time like the present to begin your financial planning.

2. Do You Need A Wealth Consultant?

For those who are keen to achieve financial well-being and be in better control over their finances, Standard Chartered, as wealth consultants, is well positioned to guide and help you keep on top of your finances.

Our financial planning consultants can help you attain financial well-being at every stage of your life. Effective money management is a discipline that should be as natural as planning for your next holiday.

You have a goal, so you can start working towards it. Money management is the first step towards achieving all your goals, from getting your dream home to a comfortable retirement.

This article is for general information purposes only and while the information in it is believed to be reliable, it has not been independently verified by us. You are advised to exercise your own independent judgement with the contents in this article.