Terminologies change all of the time, so it’s always important to make sure you know exactly what is meant by a certain phrase or title. 25 years ago, a common term in the investment advisory world was ‘broker,’ and that meant someone who would trade individual security for a commission; you rarely see anyone refer to themselves as a broker anymore—let alone do that sort of individual security trading.

So, when you hear one person touting their wealth management services, and another person touting financial planning services, the questions become: What does each one entail, and which is best for you and your family’s needs? Ultimately, the objective is always getting your finances from where they are now to where they need to be in the future via the right planning, steps, and comprehensive analysis. Not everyone will need the same plan; not everyone needs a financial planner, and not everyone needs a wealth manager. 

A certified financial planner’s job is to create a detailed plan that looks at the money coming in, the money going out, tax obligations, and the change of assets over time (this may include inheritances, stock grants, business or home sales, etc.). You have a whole world of finances that you have to take care of, and a financial planner will create a plan to map all of those things out for you.

Gone are the days where financial planners’ old three-ring binders collect dust on bookshelves. Today’s financial planners have much more sophisticated tools, like online software that can be instantly updated every day to reflect the market’s movement. The more detailed you can be with your financial plan, the better. For young families and those who are getting close to retirement, a financial plan is critical to make sure you’re doing the right things upfront and sowing the right seeds for the years to come.

A wealth manager, on the other hand, may implement a financial plan, but their goal is to help you understand how best to structure and maximize your assets. For example, once you sell your business, how are you going to invest those proceeds, and what kind of entities do you need to set up from an estate planning or business planning perspective to protect your assets and manage the money most effectively? How does your life insurance and property-casualty insurance fit into the picture? Wealth managers will help you get a comprehensive view of all of the complex financial gears you have in motion, and arrange them in such a way that they all work fluidly together for your benefit and the benefit of future generations.

Henry + Horne has been in business for over 60 years and is the largest locally owned accounting firm in Arizona. This allows them to integrate the expertise in their leading estate, gift and trust department into their approach. The result is a truly holistic strategy for their clients.

Again, wealth management is more than just assessing your incoming and outgoing money; it aims to help you be the best possible steward of your assets by looking at all of them from an investment, estate, business, planning, and even generational perspective.

It’s important to note that there are specialties that exist within the wealth management profession. For example, is your wealth manager someone who’s working in the $1 million to $2 million range, or do they understand the $15 to $20 million clients and all of their complex and comprehensive estate planning and charitable gifting needs?

Henry + Horne does both financial planning and wealth management in-house, so if you’re grateful for the information but still unsure which one is best for you, contact us by phone or email. We would love to look at your unique situation and determine which approach best suits your needs.