Choosing a Wealth Management Firm: 9 Factors to Consider
By Net Worth Advisory Group
For individuals and families seeking to grow, safeguard, and transfer significant assets, choosing a wealth management firm is a pivotal decision. Yet, the process of selecting the right firm can feel daunting, with myriad options and complex terminologies.
This article outlines nine essential considerations to help you find a firm that truly aligns with your unique goals and needs.
1. Understand What Wealth Management Means to You
Before you even begin your search, define your own expectations. What does wealth management mean in your specific context?
- Define your personal and financial goals: Are you primarily focused on a safe retirement, optimizing your tax strategy, navigating complex business planning, or building a lasting legacy for your family?
- Assess your service needs: Do you require comprehensive financial planning that touches on every aspect of your financial life, or are you primarily seeking sophisticated investment management?
- Clarify complex needs: Are you looking for help with intricate areas like multi-generational estate planning, philanthropic strategies, business succession planning, or specialized real estate investments? A clear understanding of your priorities can narrow your search significantly.
2. Look for a Fiduciary
A fiduciary is legally bound to act in your best financial interest, putting your needs above their own or their firm’s. Non-fiduciary advisors, conversely, only need to recommend suitable products, which may carry higher commissions or offer less optimal returns for you.
Always ask explicitly: “Are you a fiduciary?” and get it in writing. This verifies an objective and trustworthy relationship.
3. Evaluate Experience and Credentials
A firm’s proficiency is paramount. We recommend a Fee-Only CERTIFIED FINANCIAL PLANNER®, CFP® professional with at least 10 years of experience.
The CERTIFIED FINANCIAL PLANNER® designation indicates rigorous training, adherence to ethical standards, and a commitment to ongoing education. Inquire about the firm’s history, their typical client profile, and their track record, not just in terms of returns, but in helping clients pursue their long-term goals.
4. Understand the Firm’s Investment Philosophy
Every firm has a guiding approach to investing.
Does their philosophy align with your risk tolerance and long-term outlook? Do they favor active or passive management? Do they focus on specific asset classes or a diversified portfolio?
A firm’s investment strategy should be clearly articulated and make logical sense to you. Avoid firms that promise unrealistic returns or engage in overly complex or opaque strategies you don’t understand.
5. Know What You’re Paying For
Fee structures vary widely, so transparency is key.
- Percentage of assets under management (AUM): A common model where the fee is a percentage of the assets they manage for you (e.g., 0.5%-1.5% annually)
- Flat fee: A set annual fee, regardless of asset size.
- Hourly: Suitable for project-based advice
- Commission-based: The advisor earns commissions on products they sell (e.g., insurance, mutual funds). This can create conflicts of interest, making fiduciary status even more important.
- Fee-only vs. fee-based: Understand the difference. “Fee-only” firms earn solely from client fees, avoiding commissions. “Fee-based” firms may charge fees but also accept commissions. Learn exactly what services are included in your fee structure and if there are any hidden costs.
6. Look for a Personalized Approach
Your financial journey is unique, and your wealth management firm should treat it as such. The right firm invests time to deeply understand your specific goals, personal values, family dynamics, and even your hopes and fears.
Avoid firms that push a one-size-fits-all product or generic portfolio. Instead, seek a firm that demonstrates a commitment to providing customized, ongoing planning that adapts as your life and financial circumstances evolve.
7. Technology and Communication
A good firm has a robust communication plan that keeps you informed and engaged.
Do they offer a safe online portal for accessing your statements, portfolio performance, and important documents? How often do they communicate with clients? Is there a clear service calendar outlining these touchpoints?
8. Consider the Team Structure
Understand who you’ll be working with. Are you assigned one dedicated advisor, or is there a team approach? What is the succession plan if your primary advisor retires, leaves the firm, or is unavailable?
A well-structured team confirms continuity of service and a broader range of skills.
9. Read Reviews and Ask for Referrals
Before making a final decision, conduct due diligence. Look at client testimonials on the firm’s website, Google Reviews, as well as independent online reviews.
Consult third-party professional directories like NAPFA (National Association of Personal Financial Advisors).
If possible, ask the firm for permission to speak with one or two current clients to gain firsthand insight into their experience.
Choosing a Wealth Management Firm That’s Right for You
Choosing a wealth management firm is a significant decision. The nine considerations discussed in this article can help you find a trusted partner who helps you pursue your broader life goals with confidence and clarity.
At Net Worth Advisory Group, our mission is to significantly improve the lives of our clients by delivering exemplary financial planning and wealth management advice that enables them to live the lives they have imagined.
Call us at 801-566-6639 or schedule a complimentary, no-obligation consultation to see if we are a good fit to help you pursue your goals.
About Net Worth Advisory Group
Founded in 2003, Net Worth Advisory Group is an independent, fee-only, CERTIFIED FINANCIAL PLANNER® and investment advisory firm located in Salt Lake City, Utah. We specialize in helping people transition from the workplace into retirement and ensuring that those who are already retired will not outlive their nest egg. Our top priority is to have clients experience a greater sense of ease with diligent, personalized wealth care and the implementation of customized financial plans and ongoing personalized asset management. We equip all clients with a comprehensive financial plan, meeting every six months to update as needed and review investment performance. Our team is passionate about providing comprehensive financial planning with the fee-only model, and we love feeling like we’re making a difference in our clients’ financial lives.
As a NAPFA-registered fee-only advisory firm, our recommendations are untainted by a hidden agenda to sell financial products paying large commissions. Unlike our competitors at brokerage firms, insurance companies, and banks, we are compensated solely by our clients, so we are financially motivated to provide objective advice that is always in our clients’ best interests. Anyone can call himself or herself a financial planner, but only an advisor with the CERTIFIED FINANCIAL PLANNER®, CFP® designation has met the education, examination, experience, and ethical requirements mandated by the CFP® board. According to the CFP Board, there are 97,000+ CFP® professionals in 2023, representing about 1 in 3 financial advisors in the U.S. Net Worth advisors are also members of NAPFA, which only has about 4,600 advisors, and are either CFP® professionals or CFP® professionals in training.
Net Worth Advisory Group’s mission is to significantly improve the lives of our clients by delivering exemplary financial planning and wealth management advice that enables them to live the lives they have imagined.
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