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DILMAYA wealth management industry, which is also

DILMAYA THAPA

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UNDERSTANDING WEALTH MANAGEMET

Wealth management is defined as a customized banking & specialized financial services which includes retail banking, estate planning, legal resources, tax professionals, business succession, stock-option planning, risk management, investment management and so on from a financial specialist offered to bank clients. It is a continuous investment-advisory process. Wealth management services are usually provided to clients who earn a high level of income & business owners. They are known as the ‘High Net worth Individuals’ (HNWIs). The clients are assigned relationship managers that specifically deal with them personally. In general, it is a valued added banking service in comparison to traditional banking that offers more customized products & personalized customer service. Wealth managers incorporate financial assets of the client with a goal to grow his/her wealth. . It requires the wealth manager to have in depth knowledge about financial markets, the instruments, the players, as well as the environment.

Wealth management offers several strategies and plans for high net-worth individuals (HNIs) or companies to achieve all financial goals in a systematic manner.

WEALTH MANAGEMENT IN INDIA

The economic boom and increase in income levels of people is helping in increasing the popularity of wealth management services in India. Through development of entrepreneurial ventures that has created growth in ‘High Net worth Individuals’ (HNWIs) leading to the growth of wealth management industry, which is also the most sought after career choice. Due to the growth rate, many big companies have set up their wealth and asset management division in India.

LIST OF SOME OF THE WEALTH MANAGEMENT COMPANIES IN INDIA

1.      UTI AMC Ltd

2.      Birla Sun Life Asset Management

3.      Reliance Mutual Fund

4.      Tata Mutual Fund Asset Management Company

5.      L&T Finance Ltd

6.      SBI Mutual Fund

7.      HDFC Asset Management Company

8.      Franklin Templeton Investment Management Company

9.      DSP Black Rock

10.  Sundaram Asset Management Company Ltd

11.  ICICI Prudential Asset Management Company

12.  Motilal Oswal Asset Management Company

13.  Axis Mutual Fund AMC

14.  Bluechip Corporate Investment Center Ltd

15.  L & FS Investment Managers Ltd (IIML)

16.  Kotak Mahindra Asset Management

17.  Edelweiss Asset Management Ltd

18.  Muthoot Asset Management Company

19.  . Bajaj Holdings or Bajaj Capital

20.  Religare Asset Management Company

SERVICE PROVIDERS FOR WEALTH MANAGEMENT IN INDIA

There are mainly three types for wealth management currently- Banks, Brokerage firms and Boutique advisory firms.

Banks- they concentrate on a larger investment portfolio. They deal with mid-level segment clients as well as the HNWI’S.

Brokerage firms- focus on investing the customer’s money in shares, IPO, equity market products.

Boutique advisory firms- provide customized financial solutions to the clients majorly ultra-HNWI’S and HNWI’S.

 

 

ROLE OF WEALTH MANAGER

The job of a wealth manager is to help clients identify potentially profitable stocks, bonds, mutual funds, or managing investments, etc.-

·         A wealth manager is a great support in providing the current status of your money and offering a detailed analysis of your financial health.

·         Professional wealth manager has a multi-disciplinary skills and helps with allocating assets, tax optimization, savings goals, retirement, and passing assets to the next generation.

·         They help you determine the allocation of investments based on your requirement, help you prepare for your retirement, preserve and manage wealth, and so on.

·         A professional wealth manager simplify confusing financial markets, and help you differentiate between good and bad investments.

·         Comprehensive wealth management involves long-term strategic planning of your financial goals. A wealth manager effectively structures your plans and objectives, and creates a road map based on your financial status, set realistic goals and strategies for the business; to achieve your target.

·         The assessment of the gaps between your goals and current financial status is necessary to help you plan. A wealth manager helps you fill the gap by evaluating your resources, strength and weakness.

WEALTH MANAGEMENT SOLUTIONS FOR THE HNW INDIVIDUALS

With an increase in the number of high net worth investors in recent years, there has been an increase in the demand for more sophisticated and integrated solutions. This is where the expertise of wealth management services can be used.  

Wealth managers utilize their experience and knowledge to help provide solutions to the investors with their finances based on where they are in their life cycle and other factors. Some of the solutions are:

·         Financial Planning financial planning examines your financial health thoroughly to help you plan your investment goals for the future. This is done to understand your complete financial situation before making investment recommendations. Expenses analysis, liability management, investment planning and wealth creation, retirement planning, insurance recommendation, tax advisory is done to  help you secure all your financial goals and needs like restructuring of loans, becoming debt-free, retirement, children’s education and marriage, tax optimization, etc.

·         Investment & Portfolio Management Portfolio management is making a customized decisions to build a strong portfolio based on your financial objectives or life goals, investment mix and policy, asset allocation, risk tolerance, concerns and time horizon. 

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·         Retirement Planning A financial plan and retirement plan work together. A financial plan helps you prepare for the life you want to live during your working years, and a retirement plan helps you prepare for the life you want after you retire. The planning covers your present lifestyle, inflation, and asset allocation, healthcare and so on, to ensure that your income lasts throughout your lifetime.

·         Estate Planning Estate planning prepares a detailed plan of the division of your estate in advance, amongst the ones you want to give after your demise. It protects your assets from going into the hands of unintended beneficiaries. It also includes:

o    Name of the guardian and inheritance manager for minor children

o    Protection of the loved ones during unexpected and unfortunate events of their lives

o    Minimize taxes, court costs and unnecessary legal fees 

·         Cash Management and Lending Cash management and lending facilities are some of the most important part of wealth management package. Cash management involves handling of a day-to-day finances, usage of cash, cash flow and short-term investments.  The idea here is to enhance your liquidity and flexibility.

·         Risk Management Risk management is the forecasting and evaluation of financial risks along with measures to avoid or minimize the impact of financial and other losses. It begins with assessing your risk tolerance with risk assessment tools.

Wealth management services in India is still growing with existing players expanding their offerings and emergence of new local and global players.

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