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Russ Alan Prince Executive Director
January 3, 2022
Over the last decade, leading wealth managers have built sensational businesses by creating value for the ultra wealthy. This year is very likely to be an even better year for those wealth managers who understand the dynamics and key trends impacting the private wealth industry.
Put simply, whether the markets rise or fall, whether the economy booms or busts, whether there are national and international crises from a life-threatening resurgence of Covid-19 to a slew of natural disasters to anything short of an apocalyptic event, elite wealth managers will do very, very well for themselves. To be clear, this is only possible because they are doing an exceptional job of adding value to their ultra-wealthy clients.
The Advantages Of Working With The Ultra Wealthy
Without question, there are more ultra-wealthy families (net worth = US $30 million or more) than ever before with their ranks likely to expand in 2022. Furthermore, not only will the number of ultra-wealthy families increase, but the amount of assets they control will probably grow at an even faster rate.
For elite wealth managers, the ultra wealthy are extremely good clients. According to Vince Annable, CEO and founder of VFO Advisory Group and author of The Household Endowment Model: Wealth Planning for Affluent Families, “We find the ultra wealthy prefer the family office approach because we’re able to help them achieve their financial goals but we’re also able to help them improve other parts of their life such as the quality of the health care they receive. Very commonly, many of the ultra wealthy are failing to optimize their lives including missing out on opportunities. We specialize in filling in the gaps. We act as a coordinator to bring in all of their financial experts to discuss their most important needs. A roundtable of experts to discuss all areas of their wealth management needs.”
While most everyone wants a bargain, the ultra wealthy are intensely results oriented and appreciate the advantages leading professionals can provide. They are generally NOT concerned with costs when provided with demonstrable value. “When you show the ultra wealthy the connection between your knowledge, skills, and effort with the results they can achieve, discussions of cost are minimized or eliminated,” says Homer Smith, private wealth advisor and Founder of Konvergent Wealth Partners and Director of the Integrated Business Owners Solutions team. “This doesn’t mean we don’t do everything in our power to make sure the solutions we provide are cost-effective. We also strive to minimize the costs to our clients.”
Another advantage of the ultra wealthy as clients is that they are capable and comfortable making decisions. As Anthony Glomski, president and founder of AG Asset Advisory Family Office and author of Liquidity and You: A Personal Guide for Tech and Business Entrepreneurs Approaching an Exit explains: “Although the ultra wealthy will often consult with various professionals, they are usually able to determine what they want or understand what they need. They then tend to know what they are going to do. They will take action when it aligns with their self-interests. My job is to make sure they have all the information and answers they need to make well informed decisions.”
What Is Required To Excel Working With The Ultra Wealthy
Being able to connect with the ultra wealthy is of primary importance in order to excel in 2022. “The ultra wealthy have extensive personal and professional networks and are very likely to have strong influence within those ecosystems,” says Hannah Shaw Grove, chief marketing officer at Foundation Source and co-author of The Family Office: Advising the Financial Elite. “In studying the wealth creating mind-sets and methodologies of self-made millionaires and billionaires, we know that the facility to build powerful relationships is a major factor in their success. When wealth managers consistently deliver meaningful value to their ultra-high-net-worth clients they are positioning themselves and their practices to benefit from the relationship capital within their client base.”
At the same time, one of the most powerful ways to connect with the ultra wealthy is to be referred by a trusted professional they are currently engaging. According to Brett Van Bortel, director of consulting services with Invesco Global Consulting and co-author of Street-Smart Networking: How Financial and Legal Professionals can Cultivate Centers of Influence for a Flood of New Affluent Clients, “There are proven methodologies that enable professionals including wealth managers to create pipelines of new ultra-wealthy clients. The benefit of these processes is two-fold—a steady flow of ideal prospects and an accelerated sales cycle. In fact, professionals that are proficient at these processes can frequently walk away from a first or second meeting with high-potential ultra-wealthy clients.”
Another requirement is expertise. “Being able to do an exceptional job for the ultra wealthy is a necessity,” says Peter Sasaki, managing member of SDS Family office and co-author of Maximizing Your Single-Family Office: Leveraging the Power of Outsourcing and Stress Testing. “Now, there’s no way for any professional to be able to address the various needs and wants of the ultra wealthy. That’s why building a cohesive team of state-of-the-art experts is so important. The experts not only have to be tops in their field, they have to know how to work well with others on behalf of the client.”
Just as important as expertise is the ability to develop a deep understanding of ultra-wealthy individuals and families. “No wealth manager can deliver exceptional value to the ultra wealthy unless he or she really understands their goals and concerns,” explains Cliff Oberlin, Chairman and CEO of Oberlin Wealth Partners and co-author of Family Fortunes: How Family Enterprises Thrive Across Generations, “We work very hard to learn about the families we are introduced to in order to be able to provide them the best possible wealth management solutions. We rely on a process called Everyone Wins in order to find out precisely how we can meaningfully improve the lives of our clients.”
The Sky’s The Limit
There will certainly be a plethora of issues—of one kind or another—in 2022. But, even if the markets and economy experience a downturn, elite wealth managers will continue to excel. There have always been, and there will continue to be, a great many ultra-wealthy families looking for smart financial and related advice.
Elite wealth managers, because they can systematically connect with the ultra wealthy and are intensely focused on providing them financial solutions that make a major difference will continue to significantly grow their businesses. For these elite wealth managers because they are (1) process-oriented so that they can connect with the ultra wealthy, (2) extensively technically proficient in large part due to their cohesive teams and (3) finely attuned to their issues surrounding their ultra-wealthy clients, the sky’s the limit.
Request a complimentary PDF copy of Elite Wealth Planning: Lessons from the Super Rich at [email protected]
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