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For most people, wealth management implies services that are provided exclusively to the wealthy.  In actuality, wealth management refers to any type of financial service that is designed to enhance the financial circumstances of the client, regardless of his or her affluence or lack of financial means.  Hiring the right wealth management firm can assure that your retirement is as financially comfortable as possible, or protect your legacy for your immediate family as well as future generations.

More Than Just Investments

While wealth management companies perform many of the same functions as investment brokers, the two services are not interchangeable. In general, wealth management involves overseeing clients’ entire financial portfolios, including bank accounts, taxes insurance policies and pensions – as well as retirement and estate planning – in addition to investments. In fact, many wealth management professionals perform functions associated with attorneys who specialize in taxes and estate planning, insurance agents, investment brokers and accountants.

Full Service versus Limited Service

Full service wealth management firms handle everything from establishing trusts to managing investment portfolios and administering retirement funds. So-called high net worth clients are often drawn to full service wealth management firms. In plain English, that means that more affluent clients often have more complex financial portfolios that require individual attention.  Naturally, full service wealth management firms that are staffed with professionals are more expensive, but for high net worth clients, such services represent worthwhile investments.

However, depending on your circumstances, an assortment of limited service wealth management firms may provide a bitter fit. For instance, one type of wealth management professional may specialize in retirement funds while another exclusively creates and maintains trusts that functions along with or as a replacement for a will. People with more modest resources frequently opt for limited service wealth management firms. Limited service wealth management firms are often staffed by lower level agents rather than by brokers, attorneys or accountants.  Such limited service firms also often rely heavily on software based or automated services rather than one-on-one consultations.

Commission versus Direct Fees

There are two major payment models for wealth management firms: commission based payment versus direct fee billing. Commission based systems provide compensation for brokers or wealth management agents based on a percentage of the services provided. Direct fee based systems have fixed fee schedules – with set fees for specific services.

Commission based systems naturally provide an incentive for brokers or agents to sell more services. This can be advantageous in its emphasis on individual services – but a drawback because of the temptation to push services that may or may not be advantageous to clients. On the other hand, fee based systems are often less expensive, but savings may be realized by obliging clients to utilize one-size-fits-all services that may or may not be suited to individual wealth management circumstances.

Minimum Investment Requirement

For high net worth individuals, minimum investment requirements imposed by wealth management firms are often of little or no consequence. But for clients of more modest means, minimum investment requirements may present a barrier to utilizing certain services or prevent such clients from working with certain wealth management firms.

Due Diligence

It should go without saying that any wealth management firm you’re considering working with should be thoroughly vetted. Full service firms often include certified public accountants (CPAs) or other licensed financial advisers on staff. Limited service wealth management firms may include agents who provide generalized services. Both full service and limited service wealth management firms can be vetted through user testimonials and through oversight services such as the Better Business Bureau (BBB).

Compare Investment Advisors

For most people, wealth management implies services that are provided exclusively to the wealthy.  In actuality, wealth management refers to any type of financial service that is designed to enhance the financial circumstances of the client, regardless of his or her affluence or lack of financial means.  Hiring the right wealth management firm can assure that your retirement is as financially comfortable as possible, or protect your legacy for your immediate family as well as future generations.

More Than Just Investments

While wealth management companies perform many of the same functions as investment brokers, the two services are not interchangeable. In general, wealth management involves overseeing clients’ entire financial portfolios, including bank accounts, taxes insurance policies and pensions – as well as retirement and estate planning – in addition to investments. In fact, many wealth management professionals perform functions associated with attorneys who specialize in taxes and estate planning, insurance agents, investment brokers and accountants.

Full Service versus Limited Service

Full service wealth management firms handle everything from establishing trusts to managing investment portfolios and administering retirement funds. So-called high net worth clients are often drawn to full service wealth management firms. In plain English, that means that more affluent clients often have more complex financial portfolios that require individual attention.  Naturally, full service wealth management firms that are staffed with professionals are more expensive, but for high net worth clients, such services represent worthwhile investments.

However, depending on your circumstances, an assortment of limited service wealth management firms may provide a bitter fit. For instance, one type of wealth management professional may specialize in retirement funds while another exclusively creates and maintains trusts that functions along with or as a replacement for a will. People with more modest resources frequently opt for limited service wealth management firms. Limited service wealth management firms are often staffed by lower level agents rather than by brokers, attorneys or accountants.  Such limited service firms also often rely heavily on software based or automated services rather than one-on-one consultations.

Commission versus Direct Fees

There are two major payment models for wealth management firms: commission based payment versus direct fee billing. Commission based systems provide compensation for brokers or wealth management agents based on a percentage of the services provided. Direct fee based systems have fixed fee schedules – with set fees for specific services.

Commission based systems naturally provide an incentive for brokers or agents to sell more services. This can be advantageous in its emphasis on individual services – but a drawback because of the temptation to push services that may or may not be advantageous to clients. On the other hand, fee based systems are often less expensive, but savings may be realized by obliging clients to utilize one-size-fits-all services that may or may not be suited to individual wealth management circumstances.

Minimum Investment Requirement

For high net worth individuals, minimum investment requirements imposed by wealth management firms are often of little or no consequence. But for clients of more modest means, minimum investment requirements may present a barrier to utilizing certain services or prevent such clients from working with certain wealth management firms.

Due Diligence

It should go without saying that any wealth management firm you’re considering working with should be thoroughly vetted. Full service firms often include certified public accountants (CPAs) or other licensed financial advisers on staff. Limited service wealth management firms may include agents who provide generalized services. Both full service and limited service wealth management firms can be vetted through user testimonials and through oversight services such as the Better Business Bureau (BBB).

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Company

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Minimum Account

Management Fee

Additional Details

Company Website

Betterment

Betterment

3
1
1
5 total votes
Management Fee 0.25% - 0.4% 0% 1%
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
Personal Capital

Personal Capital

1
 
 
1 total votes
Management Fee 0.49% - 0.89% 0% 1%
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
Acorns

Acorns

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Starting Management Fee 0.25% Starting Management Fee
  • Fee Based
Stash Invest

Stash Invest

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Starting Management Fee 0.25% Starting Management Fee
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
Swell Investing

Swell Investing

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Maximum Management Fee 0.75% Maximum Management Fee
  • Fee Based
Wealthsimple

Wealthsimple

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Management Fee 0.4% - 0.5% 0% 1%
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
Vanguard

Vanguard

5
3
 
8 total votes
Starting Management Fee 0.3% Starting Management Fee
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
Hedgeable

Hedgeable

1
 
 
1 total votes
Starting Management Fee 0.75% Starting Management Fee
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
MassMutual

MassMutual

 
2
9
11 total votes
Starting Management Fee 0.15% Starting Management Fee
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor
J.P. Morgan

J.P. Morgan

 
 
1
1 total votes
Starting Management Fee 1.5% Starting Management Fee
  • Fee Based
  • Independent/Registered Investment Advisor
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  • Fee Based
  • Independent/Registered Investment Advisor