Goals-based wealth management: Start now to plan for the life you want to live
You have unique goals, and your wealth management strategy should be designed to reflect the specific aspirations you have for yourself and your family. It should also go beyond just creating a portfolio to help you plan for retirement and other life priorities, such as saving for your child’s education or leaving a meaningful legacy.
Over the past 30 years, the wealth management industry has evolved. The role of the financial advisor has transformed from stockbroker to caretaker of financial lives. In the wake of the financial crisis, financial advisors have increasingly taken on the role of fiduciaries, putting their clients’ best interests first.
Today, wealth management is a high-level professional service that goes beyond just investment advice to encompass every part of your financial life. Rather than trying to piece together advice from a series of professional advisors, you benefit from a holistic approach, where a single advisor or team of advisors coordinates all the services needed to manage your wealth and plan for your current and future financial needs.
Goals-based wealth management
Traditionally, wealth management centered around having a diversified portfolio and measuring its performance against a benchmark. But, for most people, successful wealth management is less about the day-to-day fluctuations in the market and more about having the resources they need to pursue and achieve their goals.
Goals-based wealth management revolves around reaching your objectives, rather than chasing after an elusive return. It changes the focus from creating a portfolio to concentrating on building the life you wish to lead. With goals-based wealth management, you develop a strategy to help reach your goals and measure success by the progress you’ve made toward achieving them.
As your life stage changes, so do your goals. Early in your career, you may be focused on buying a home or starting a family. Over time, your priorities may shift to sending your children to college, assisting your aging parents or planning for retirement.
In retirement, your concerns may be generating enough income to maintain your lifestyle or creating your legacy. To keep pace with your evolving needs and priorities, goals-based management is an ongoing process that helps ensure your strategies are always aligned with your goals, even if your goals change.
In an increasingly complex world, goals-based wealth management helps you create a financial road-map to the future you envision for yourself and your family. With the help of a financial advisor who invests time in understanding you and your full financial picture, you can develop a wealth management strategy that helps fit your needs and helps maximize your probability of reaching your most important goals.
Terri Roberts Munsell is a financial advisor in Leawood at Morgan Stanley and a member of the Financial Planning Association of Greater Kansas City.
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