How to Hire a High-Net-Worth Financial Advisor

Even though hiring a financial advisor should be straightforward, oftentimes it is not. The first requirement should be a fiduciary and fee-only. However, for high-net-worth families, it gets more complicated. When you have a high net worth, you need more than what regular financial advisors offer. The fees that these advisors charge increase depending on the assets of clients. So, they should at least offer more to justify those fees.

What Goes On Behind the Curtains

Estate planning, attorneys have the responsibility of drawing up all the legal documents. However, a financial advisor can help the attorney understand what the family’s goals and aspirations are. For tax planning, a CPA prepares the tax return document, but they often don’t ask any questions besides those needed to ensure your tax return is filed correctly. The financial planner is the one who understands the complexities of high-net-worth families’ tax situations and is able to convey that to the CPA. When it comes to insurance, many financial advisors will try to sell insurance because they receive a commission for selling it. On the other hand, a high-net-worth financial advisor should never receive a commission from selling any products to their clients because it creates a conflict of interest. A high-net-worth financial advisor understands the value insurance plays in a family. 

Investment Management for High-Net-Worth Families

Something else to consider is investment management. High-net-worth families usually don’t only have investments solely in the stock market. There are advisors who will charge a percentage fee to manage assets, and on top of that try to get clients to invest in their own funds for a percentage fee, as well. This is why it is important to avoid that kind of conflict of interest and focus on finding someone who understands your specific needs but won’t charge you extra because of your financial situation.

Have more questions? Contact Us

Casey Smith
President, Wiser Wealth Management

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