Effectively managing funds as they are invested is important for growing wealth and securing a solid financial future. Because there are many different styles and methods of achieving this, it is helpful to understand the basics of investment management – and why it matters.
What is Investment Management?
Investment management involves the handling of assets in a manner that achieves specific investment goals, both short-term and long-term. Working with an experienced financial consultant, you will be able to develop a strategy that will allow you to grow your wealth and expand your portfolio at a risk level you are comfortable with.
Financial consultants who manage investments want to help you reach the future you envision for yourself. They do this by allocating assets, analyzing your financials, researching ideal investments, monitoring existing investments, creating a customized portfolio strategy, and implementing it. To formalize the plan, an Investment Policy Statement (IPS) is built, assuring that all current and future investments are aligned with it.
Investment management can involve all types of investment, including:
- Real estate
- Precious metals
- Fine wine
Of course, the combination of investing used will be unique to each individual.
Investment Management vs. Wealth Management
Many people use the terms investment management and wealth management interchangeably. However, there are two different things. Investment management holds just a small space under the umbrella of wealth management.
Investment management is all about managing your investment portfolio and helping you to meet your financial goals through various methods. Wealth management has a wide focus on all areas of your financial health and creates solutions to help you achieve your financial goals without having to worry about a thing. This includes estate planning, tax strategies, retirement preparation, philanthropy goals, and the like.
Choosing whether investment management or wealth management is right for you will come down to your level of comfort in handling financial matters. Sometimes having experts on your side is one of the best things you can do for your future.
Why Investment Management Matters
In today’s world, investing is easy. For instance, there are any number of apps that will allow you to buy stocks or invest in cryptocurrency from anywhere with the click of a button. You can even do simple online bank transfers to put money into CDs. But without the right investment knowledge and experience, you could just be wasting precious time — or worse.
If your plan is to grow your wealth, then investment management is key. It matters because it is the best way of making the most of what you have. In other words, whether you have $1 or $10M, the way that you invest your money will determine what will happen to it in the future.
Could you just place it in a low-interest CD for safekeeping? Sure. Will it help you achieve your financial goals? Not likely.
There are so many different ways in which skilled financial consultants manage investments that you won’t want to miss out on. Make choices today that will give you future finances that align with your goals.
The Investment Counsel Company is ranked as one of the Top 100 Independent Financial Advisors, offering wealth management services to those with $1,000,000 or more in investable assets.