COLUMN: Seeking wealth management advice – a growing need

C130413-6 Chi Tim Reedman  phot kate''Tim Reedman. Picture by Kate Shemilt.C130413-6
C130413-6 Chi Tim Reedman phot kate''Tim Reedman. Picture by Kate Shemilt.C130413-6

Our online columnist Tim Reedman talks you through one of the big financial issues of the moment... looking after your money.

Increasingly there are more of us who have either created or acquired capital, or who earn higher incomes than average, and whose circumstances are sometimes more complicated than usual. But being wealthier also brings with it the associated problems of how to preserve that wealth and how to shelter it from the burden of higher taxes – Inheritance Tax is a good example because it has become a regime that now affects many, many people, not just the super-rich.

Wealth management is about taking care of all your financial needs together with those of your family, but the reality is that very few of us manage our finances as best we might. This is hardly surprising - the financial world is complex and fast changing, with a myriad of choices available. Achieving a successful outcome means spending huge amounts of time researching those choices and options. And yet most of us have neither the time nor, it has to be said, the inclination to make the most of what is on offer.

The simple way out of this dilemma is of course to seek financial advice and sensibly many of us do just that. The problem is that much financial advice is too narrow, addressing the question you have raised but failing to see the bigger picture. For example, if you ask for advice on investing tax-efficiently in an ISA you will probably get it. What you don’t get, however, is a view on whether you would be better off putting the money into your pension plan or reducing your mortgage borrowings.

If you own or manage a business, you should expect advice that extends seamlessly from your personal finances to your business interests. This means, for example, advice on the best approach to realising the value of your ownership, both over the years and when you come to implementing your exit strategy. Aligned with your interests are those of your employees so you will need someone who can also provide a tailored package of group benefits - ranging from pensions to healthcare plans.

Your financial situation is unique so the core of wealth management should be a personal service and a long-term relationship with a chosen adviser combining ongoing regular and comprehensive reviews of your personal finances. Wealth management should provide a co-ordinated or holistic plan of all aspects of your affairs. Rather than sell you a financial product and never see you again, a wealth manager should be on hand throughout your life. For a successful relationship you have to trust your wealth manager implicitly and there has to be empathy with your aspirations because only in this way can you create a successful strategy for your financial affairs.

So the first step is to choose a wealth manager. They come in different forms - private banking services, financial advisers, discretionary fund managers, lawyers, tax planners and accountants all offer facets of wealth management. In making a choice the real test is whether your wealth manager has the necessary skills and experience to understand your needs, create a bespoke solution and provide a high level of advice and specialist services either from within or outside their practice.

As part of your selection criteria it is worth reviewing the size and financial strength of the wealth manager. Larger institutions can often provide a greater depth of expertise and resource, ideally coupled with a comprehensive personal service. Additional reassurance might come from the fact that advice being given by the wealth manager in respect of the products and services on offer is guaranteed.

Whatever criteria you apply in making your choice is of course subjective, but the key issue is ultimately whether you feel confident that your chosen adviser will help manage your wealth in a proactive, professional manner.

To receive a free guide covering wealth management, retirement planning or inheritance tax planning, produced by St. James’s Place Wealth Management, contact Tim Reedman, of St. James’s Place on 01243 788567, or 07738 832115, by email or visit