Financial Planning for Ultra-High-Net-Worth Individuals

The Securities and Exchange Commission (SEC) defines high-net-worth persons as individuals with a net worth of at least $1.5 million or $750,000 in investable or liquid assets. Ultra-high-net-worth individuals (UHNWI) are those who have at least $30 million worth of net investable assets to their name. For such individuals, financial planning and wealth management is absolutely crucial. This is where independent financial advisories such as Avestar Capital come in with their abundant asset & risk management expertise, leading advisors and portfolio management. 

Decamillionaires or those with over $10 million in investable assets are discerning and demanding clients who require sophistication and high levels of trust in their financial advisors. They have families and children to support, and the main goals often are wealth preservation and looking for opportunities that will grow the wealth. Avestar Capital Founding Partner Xerxes Mullan, having worked with ultra-high-net-worth individuals and families, emphasizes the importance of technology-enhanced experiences. Decamillionaires tend to be tech-savvy, and offering them technological intelligence to simplify their financial interests is an important step. 

Nearly 75% of decamillionaires tend to work with financial advisors, and 3 out of 10 even have multiple financial advisors, making this an extremely competitive space. While the average relationship between an ultra-high net worth individual and a financial advisor lasts about 15 years, new research from EY indicates that 39% of them plan to move to a new advisor in the next three years. Furthermore, Fidelity Investments conducted research that identified that 1 in 4 decamillionaires may be at risk of leaving their financial advisors. However, decamillionaires are an extremely compelling clientele since their median investable assets amount to around $12.5M. They are also more likely to refer their financial advisors. 

Financial advisors need to understand the levers of attention and behaviours of decamillionaires. A higher service need is anticipated since advisors also have to be sensitive to the needs of their families. Avestar Capital has developed a network of individuals, shared ideas, and opportunities that encourage confidence and bring together like-minded individuals who share similar values. Therefore Avestar Capital can effectively and seamlessly manage financial complexities for their clients. Almost 50% of decamillionaires expect their advisors to provide more comprehensive services. Avestar Capital has a Family Office with a complete offering with a full suite of services primarily catering to ultra-high net worth families. However, only 1 in 7 at-risk decamillionaires believe that their advisors can fulfil their investment management needs and financial planning services. Apart from this, Avestar Capital offers an open architecture and integrated financial, estate and tax planning.  

Decamillionaires have a relatively sophisticated investment product palette. They are more likely to invest in international securities, real estate, alternative investments and charitable products. This creates a complex product mix, which could be why they have numerous advisors and have higher expectations from them. 

UHNWI will expect a “white-glow” approach from financial planners. This premium approach focuses on personalization and careful attention to detail. Decamillionaires may also be more likely to have more complex financial holdings and prefer advisors with experience in alternatives, real estate investment and international investing. 

Furthermore, this personalized approach to delivery is enhanced when financial advisors serve as their concierge and can curate information, resources and experts that fit in with their exact family structure and needs. Other services such as estate planning, charity, etc. should be easily accessible as well. Advisors are expected to play an active role and conduct regular check-ins with their clients. The use of technology and tech-enabled services are an added bonus that demonstrates value. 

A high-touch customer experience can be delivered through digital access to accounts for the clients through an app or through online portals. Owing to the complex financial situations, online reporting capabilities and various self-help tools are of abundant use to ultra-high net worth individuals. Data visualization can also be embedded so that the path between investment performance and goals or objectives is made clear. Being able to customize tools ensures that family members can view different aspects according to their needs. A robust advisory team and access to them is absolutely essential. Clients should be able to reach out to advisors across multiple platforms for efficient responsiveness. 

Avestar Capital practices purposeful transparency, conflict-free and objective services to their ultra-high net worth clients and encompasses a tech-augmented and non-traditional approach towards their clients. With a world-class team of experts across various fields, Avestar Capital offers a differentiated platform for its clients. 

Avestar Capital has established itself as a modern business for clients such as these by offering them a host of services such as family office services, balance sheet administration, cross border/ offshore investment opportunities and more. With a skilled and strong team of Global Advisors, Avestar Capital helps connect new ideas and opportunities with human capital, financial data and technology.