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Traditionally, $1 million was the magic money sign that symbolized real wealth. “While $1 million was historically the traditional ‘entry-level’ for private property, many companies are now looking at $5 million to $10 million before they can really deploy more sophisticated solutions,” said Kevin Reed, chief revenue officer at . Aquilance.
Your needs may change when you reach $1 million, $5 million or $10 million, depending on your lifestyle. As your net worth grows, ask your financial advisor these questions to determine if it’s time to move on or expand the team of financial experts helping you grow and preserve your wealth.
What fees am I paying?
As the focus shifts to wealth preservation, it is important to check and find out how much of your money is going to fees. “As assets grow, percentage-based fees should ideally face downward pressure,” Reed said.
You want an advisor who provides high-touch service – and you want to understand exactly what you’re paying for.
Do you offer services beyond financial planning and investment management?
As your net worth grows, your responsibilities may also grow – especially if you have active investments like real estate or multiple businesses.
“Families with $1 million can have administrative and operational complexities that require an advisor to offer much more than investment management,” Reed said.
Working with an advisor who offers family office services like bookkeeping and bill paying can free up time, which becomes your most valuable asset when your net worth reaches seven figures.
How does your investment philosophy change for a client at $1 million versus $100K?
This question is at the heart of finding a financial advisor who fits your needs. Reed said an advisor who doesn’t change his strategy or philosophy as a client’s wealth grows could be a red flag that it’s time to move on.
“Larger portfolios allow access to alternative investments, private equity or more customized individual security sleeves that are not practical for smaller accounts,” he said.
Your lifestyle may not magically change when your net worth reaches $1 million, but it’s a good time to reevaluate your financial planning and the experts you trust.