Whether you’re looking to become a wealth manager or an asset manager, or you’re simply interested in how to best manage your own personal finance and assets, there are a number of key considerations which you will need to ensure that you have covered. One of these import actual ant considerations when it comes to reviewing your finance options is the actual difference between investment management and wealth management. Here, we’re taking a closer look at the differences between the two in order to ensure you make the right decision when deciding your career path.
While investment banking operates on a corporate basis, wealth management is more concerned with the finances of high net-worth individuals (normally in the income bracket of $2 million and above). Wealth management in this sense typically refers to simple money management techniques, but due to the large amounts of money these type of individuals are dealing with, it can often be difficult for an individual to manage this themselves. While there are many types of efficient wealth management software on the market, some individuals will seek professional wealth management services in order to ensure that all areas of their financial situation are accurately and appropriately managed, without the need to be personally involved. There are numerous areas in which a wealth manager may help, including tax planning, client investments, estate planning and retirement planning.
Wealth management is generally split into two areas – relationship building and the actual investment professional area. In order to accurately manage a client’s funds, a wealth manager must first get to know the client and their spending habits. This will allow them to accurately predict the spending which occurs as a result of the client’s actions. As a result, regular face-to-face meetings and telephone conversations are a key part of this role, and this is an ideal opportunity for those of a friendly nature. As a career path, wealth management can be exceptionally fulfilling, but highly stressful as you are the primarily responsible for the individual needs of the client.
The overall duties of an investment banker are to offer financial services and advice to corporate entities and handle various financial situations such as mergers and acquisitions, and any form of business finance restructuring. In addition to this, an investment banker may also handle initial public offerings, stock splits and issues with bonds or stocks.
Some investment bankers may also handle any corporate short-term investments which their clients are interested in, and some of the very best may even negotiate complex deals for their clients. One of the major areas in which investment bankers must be adept is their ability to understand industry-specific factors which can drive the success and failure of a business and must be able to fundamentally evaluate a business. With key skills in accounting, as well as having a creative mindset which is also able to problem-solve efficiently, investment bankers can have a fulfilling and long-term career which offers excitement and personal growth.
Understanding the difference between the two financial services, wealth management, and investment banking, can allow you to make the most appropriate career choice in the future. Whether you’re looking for a long-term move into the financial industry, or you’re more interested in learning the essential skills to accurately manage your own personal or business finance, there’s a lot to pick up from these two individual job profiles.