Financial Planning
April 15, 2022

The Importance of Wealth Management

Stewart Willis

It’s difficult to plan and set aside resources for the future. In a fast-paced world, everything is “now now now” leading to “I’ll worry about this later.” Without a thorough strategy to manage financial success, you might find yourself strapped for cash later in life. Especially with inflation running rampant these days. 

The past is the past. Maybe your 20s and 30s were so hectic that you didn't think you’d ever need wealth management services. Or, maybe the long-term benefits to effective wealth management early on were hard to see or believe. 

Either way, the best way forward is to begin financial planning with the help of trustworthy financial advisors that have your best interests at heart, not theirs. Here’s a quick breakdown of why it’s also important to manage wealth with a clear, experienced, and concise plan - instead of planning on your own. 

Cash flow and earnings optimization

‍The most significant benefit of professional wealth management is optimizing your cash flow and earnings towards a series of specific financial-related goals. In other words, you have to make a strict budget, adhere to it for years, and remain in an agile financial position to adjust the plan as needed if unforeseen expenses come up. 

This is more fun than it sounds - imagine yourself a year from now, just watching your nest egg grow from some simple steps you took to set aside money. That’s just one example of the value and importance of wealth management.

It’s worth noting a wealth management strategy and financial advice isn't an ordinary budget because it includes more than income and monthly expenses. For example, estate planning requires an in-depth dive into inheritance law that most people don't include in an annual household budget; however, it's a standard day-to-day activity for wealth management professionals.

Goal-based planning with milestones that make sense for you

‍Think of a wealth management strategy as your long-term blueprint to enjoy the life you’ve always wanted. This means different things for different people. A young millennial couple who just had their first child will have very different financial goals than an early retiree who's already raised a family. The true value of wealth management rests in its ability to help you meet tangible goals. 

Most likely, the young couple will want to secure their child’s financial future and set money aside to pay for college and living expenses, but what about the early retiree? There’s no end to the possibilities as we grow older and have a more mature understanding of how we want to live, and wealth management is how you achieve that ideal.

For many people, these goals include retirement planning. This is what makes wealth management experts so important. By analyzing your current financial situation, wealth managers can estimate future income needs. Then, they can create a comprehensive plan to meet those goals. 

With their expertise and knowledge, you can better understand howyour investments and assets are allocated for retirement planning, investment strategies, and estate planning. The goal is to ensure you have enough money to live comfortably in your later years.  

Taxes Taxes Taxes

Taxes are another consideration, and for many, that's why they make a wealth management plan in the first place. Suppose you're an entrepreneur and you're experiencing a reasonable amount of success. In that case, you already know how tangled business taxes can be, especially if you live in a state with income taxes or other financial regulations. 

For instance, wealth management in Arizona looks different from wealth management in Texas, where there is no state income tax. Most people hire accountants to keep track of everything, but a wealth management strategy considers all taxes that you have to pay now and those you might have to pay in the future. Without a process in place, you could get over your head with unpaid taxes if you didn't plan ahead for continued success.

That’s part of the importance of wealth management. You need financial services that take your current financial situation into account, now and in the future. How are you supposed to make sound financial decisions without a solid financial picture?

Managing and Mitigating Risks

Wealth managers help people like you plan their financial future by creating a comprehensive financial plan tailored to your goals, risk tolerance, and time horizon. Why is private wealth management a viable option for you? It helps with risk management for your portfolio. 

The importance of wealth management has grown due to the rising complexity of the financial market. Wealth management helps individuals and families manage and mitigate risks, such as market volatility, inflation, and unexpected life events like job loss or illness. Proper risk management can help protect assets and ensure financial stability.

A good risk management plan can help protect your investments and increase the chances of achieving your financial goals. With the help of a professional adviser, you can implement strategies to minimize risks while maximizing returns over the long term.

Real Research and Concreate Analysis

Research and analysis are essential components of successful financial planning — and part of the importance of wealth management. 

By leveraging the power of a certified financial planner (CFP) to conduct in-depth research and analysis, you can gain a better understanding of the various investment products, investment strategies, financial markets, and macroeconomic trends. This allows you to make more informed decisions that can lead to greater returns on your investments.

Wealth management doesn’t occur in a vacuum. A wealth manager must have the perspectives of a wide range of experts to determine the best strategy for you. Team collaboration is essential for success in wealth management. 

Working closely with other financial advisors, portfolio managers, and investment strategists helps ensure that clients receive the best possible advice from different perspectives. Our teams can create a comprehensive plan to meet your needs by leveraging each other's expertise.

Creating Legacies and Protecting Beneficiaries

Estate planning can be a tricky process. This an area where the importance of wealth management becomes clear. Effective estate planning can help protect your assets for your beneficiaries and future generations.

Wealth managers are adept at creating strategies to reduce taxes and helping you transfer your assets to heirs or beneficiaries, efficiently and according to your wishes. You won’t have to worry about probates or state taxes that will need to be paid with the right strategies in place.

Investing in education is a vital part of planning for the future. Wealth managers can help clients do just that by setting up college savings plans and other investment vehicles to ensure their children's educational needs are taken care of.

Consider getting help from a pro

These are some of the reasons that show you the importance of wealth management and how it can impact your life for the better. 

Asset Preservation Wealth & Tax can help you today if you’re ready to make the first step. Getting started is easy. All we have to do is find out where you stand financially, identify your personal financial goals, and create a plan to reach those goals.

Get a free portfolio review today!

Stewart Willis is the founder and president of Asset Preservation Wealth & Tax, a financial planning firm in Phoenix, Arizona. Investment advisory services offered through Foundations Investment Advisors, LLC, an SEC registered investment adviser.

The commentary on this blog reflects the personal opinions, viewpoints and analyses of the author, Stewart Willis, providing such comments, and should not be regarded as a description of advisory services provided by Foundations Investment Advisors, LLC (“Foundations”), an SEC registered investment adviser or performance returns of any Foundations client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment, legal or tax advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Personal investment advice can only be rendered after the engagement of Foundations for services, execution of required documentation, including receipt of required disclosures. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Foundations manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Any statistical data or information obtained from or prepared by third party sources that Foundations deems reliable but in no way does Foundations guarantee the accuracy or completeness. Investments in securities involve the risk of loss. Any past performance is no guarantee of future results. Advisory services are only offered to clients or prospective clients where Foundations and its advisors are properly licensed or exempted. For more information, please go to and search by our firm name or by our CRD # 175083.

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