How Wealth Management and Financial Planning Work Together

It doesn’t take an economic expert to realize that we live in some pretty turbulent times in terms of money. Whether you’re a business owner, an investor, or anyone else dealing with capital and finances, you likely already know just how difficult it can be to manage your assets while continuing to turn a profit in a world that’s been struck by a global pandemic and unprecedented political turmoil in the same year.

Though 2024 isn’t exactly an unprecedented year when it comes to markets fluctuating and businesses closing down and many people losing their wealth. The seas in this respect are always rough and choppy, and that’s why so many people turn to places like MRG Wealth Management to help them safeguard against unforeseen changes and circumstances.

 To the average person who’s seeking out professional help with their business and/or their finances, they may approach the management of wealth and financial planning as two separate things. However, as we will illustrate below, they share a lot more in common than you may realize; to the point, in fact, that they’re practically intertwined. The sooner you realize that, the sooner you can start seeking the right expert help for your finances.

What is Wealth Management?

This is a practice that is abbreviated as “WM” in the professional sector. In essence, WM is more a form of investment management that’s designed to help individuals or companies properly manage the money that they’re making from their business ventures or investments. For instance, if you own a successful franchise, should you put those profits into another to start up a chain? The professionals in this field will advise you in this regard.

They’re staying on top of market trends and are experts at deciphering data, and so they’re able to help you assess the risks that you’re taking on and will advise on what is and isn’t a smart move. The idea with WM is to have your money invested so that it will grow. It’s not about saving and sitting on the nest egg. It’s about nurturing that nest egg so that it grows and multiples.

What is Financial Planning?

Constructing a financial plan is also all about wisely spending and investing your money and capital. A trend you’re going to notice with both of these disciplines is that it isn’t about stuffing your money into a safety deposit box or under a mattress and waiting for the bottom to fall out of the market so that you still have spending money.

Rather, creating a financial plan here is all about strategically spending and investing your money in different sectors and ventures that are going to help that financial investment grow and flourish. That’s why something like a financial plan is typically for people who operate businesses or for investors. Private citizens just worried about managing their money need a budget, not a professional financial plan.

How the Two Meld as One

 As you can tell by these descriptions above, the two disciplines here are intrinsically intertwined, really to the point that you cannot properly handle one without incorporating elements of the other. While it is true that these are separate disciplines, generally speaking, it’s also true that they rely upon one another. One cannot create a proper financial plan without properly managing one’s wealth, just as one cannot properly manage wealth without having an ideal financial plan. Birds of the same feather, if you will.

Financially Planning to Manage Wealth

Expert Guidance

The first way that one financially plans to manage wealth is by seeking expert guidance. There are professionals whose entire businesses are set up to help you manage your wealth and to make proper financial plans. While a lot of people, whether business owners or investors, believe that they can handle these things alone because they’re intelligent and know how to crunch numbers, the fact is that the markets today are just too volatile to go at this alone. As a businessperson or an investor, you cannot afford to spread yourself so thinly that you’re allowing your decision-making to lapse because you’re busy plotting out your finances. Some things are better left to the professionals in the genre.

Capital Advice

 Do you have time to manage the daily ins and outs of your business or your portfolio while still thoroughly researching different investment opportunities? Very few people can go at this sort of thing alone and achieve success. You better believe that people like Jeff Bezos and Warren Buffett spend a whole lot of money on entire teams of professionals to help them plan financially and to make investments. This is something that requires a ton of research and legwork before it can be acted on, and most people just do not have the time or tools to handle all of these different ventures.

Planning and Liquidity

 One of the biggest problems a lot of businesspeople face is that their “worth,” so to speak, is tied up into various assets related to the business, like different products, construction, and existing recurring financial obligations to employees, vendors, etc. In other words, these assets are “frozen,” or “illiquid,” as some call them. Well, the right financial planners and wealth managers can help ensure that you always have liquid capital freed up that you can easily convert to cash. After all, the money is there. You just need some help in ensuring what you need stays liquid.

Tax Codes and Breaks

Perhaps one of the most important aspects of operating a business or investing your capital is handling and abiding the tax code of your province or state, along with your nation. There are so many different thousands of tax regulations that the old saying goes: “Everybody breaks a tax law. Most just get away by sheer luck.” That’s how many regulations are added to the books every single year. So you need the experts to ensure that you’re fully abiding code and regulations at all times.

 The bottom line is that you’re going to need expertise to guide you. To say that these fields are volatile would be a true understatement. The fact is that exponentially more people lose money than make it. And the ones that make it always have help.