Financial PlanningAAM five questions to ask your wealth manager

Five questions to ask your wealth manager

Choosing a wealth manager is an important decision, but asking these five questions can help you find the right one for your needs.

The relationship between you and your wealth manager is a vital one. It could determine the difference between a comfortable retirement and a later life of penny pinching. Just as you wouldn’t choose a builder or plumber without finding out about them first, you should also check out your wealth manager before committing.

At AAM Advisory, we offer a free initial meeting so that you can check for compatibility.  At this first consultation, it’s important to have your queries ready in advance, so that you can really check that you’ve found the right wealth manager for you.

The questions below are a good starting point for working out whether you and a wealth manager will be able to work together.

1. How and what do you charge?

Just like you pay a plumber, decorator or anyone else who provides you a service, you would expect to pay a wealth manager. However, different wealth managers charge in different ways.

Find out if they charge by the hour, whether there’s a flat rate or whether they charge a percentage of the money that you are investing. If they say they will charge an ongoing fee, they must provide ongoing advice. You may not feel you need ongoing advice if you’re only interested in a one-off assessment, so check what is available and what suits you.

Don’t be afraid to talk about specific figures. You need to be completely comfortable with the charging structure. Your adviser should be able to give you an estimate of the cost of the type of advice you will need.

2. Do you have many clients in a similar income bracket and position as I am?

Some wealth managers concentrate on particular types of people, either with a specific level of wealth or specific circumstances – for example, those who are self-employed, or those who have UK pensions. If your wealth manager usually deals with the very wealthy and you have more modest means, that doesn’t necessarily make them a bad choice for you but do check that they’ve dealt with similar situations before.

A wealth manager who has many clients in your position is likely to understand your situation and goals and will have specific expertise in the types of solutions that are suitable for you.

3. Do you have additional qualifications or specialisms above the bare minimum?

Wealth managers need to have a certain amount of training and must engage in continual professional development to keep their qualifications. However, taking extra qualifications, especially in areas that are relevant to your finances, can show that the adviser is taking a special interest in changing financial regulations, and is likely to be switched on to new ideas and legislation.

Broadly speaking, all Financial Adviser Representatives in Singapore (this is what the Monetary Authority of Singapore calls all those licensed to provide financial advice under the Financial Advisers Act) will have the basic CMFAS qualifications required by the Monetary Authority of Singapore. However, experts advise looking for someone with additional qualifications, or having the backing of highly qualified specialists, where you have more complex needs.

Some specialist types of advice, such as advice on whether to transfer your UK Pension to an alternative, require advisers to take separate qualifications. Check whether your wealth manager has access to the expertise you need.

4. What’s your investment philosophy?

This is a more open-ended question, but the answer to it may be key to you and a wealth manager working well together. While an adviser must tailor your investments to your level of risk tolerance, a wealth manager who shares your views on ethics, risk and goal setting may be easier to work with. Even if you don’t see eye to eye on everything, a conversation about this ought to give you both an indication of whether you can work together.

5. Do you have any client testimonials I could look at?

Unless you’ve found your wealth manager by word of mouth, such as from a family member or friend, client testimonials could be a good place to get a feel for your potential wealth manager.

In an increasingly complex and competitive world, expert financial advice is key to securing your future.

Important information

The views expressed in this article are those of the author and do not necessarily reflect the views of AAM Advisory Pte Ltd. This document is intended for general circulation and for information purposes only. It may not be published, circulated, reproduced or distributed in whole or part to any other person without prior consent of AAM. This document/article should not be construed as an offer, solicitation of an offer, or a recommendation to transact in any products mentioned herein. The information does not take into account the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a licensed wealth manager regarding the suitability of the investment product before making a commitment to purchase the investment product. Whilst we have taken all reasonable care to ensure that the information contained in this document is not untrue or misleading at the time of publication, we cannot guarantee its accuracy or completeness. Any opinion or estimate contained in this document is subject to change without notice. The above report may contain data obtained from third parties and as such we cannot guarantee the accuracy of this data. AAM advisory Pte Ltd is licensed by the Monetary Authority of Singapore, FA Licence no 100032.