Tax Strategy

How to Choose the Right Financial Planning Firm

How to Choose the Right Financial Planning Firm
February 14, 2024

Selecting the right financial planning firm is crucial for high net worth individuals and families looking to grow and preserve multigenerational wealth. The ideal firm provides customized investment management, tax strategies, and estate planning tailored specifically to your financial situation and goals. As you evaluate prospective firms, here are the key factors to consider:

Services Offered

Look for a full range of wealth management services, including1:

  • Investment management and advisory
  • Retirement planning
  • Education planning
  • Tax planning and preparation
  • Trust and estate planning
  • Philanthropic planning
  • Business succession planning

The right firm will take a goals-based approach to financial planning that integrates all of these services into a cohesive wealth management strategy personalized to your needs and objectives2.

Fees and Costs

Reputable firms serving high net worth clients work on an assets under management (AUM) fee structure, typically charging 0.50% to 1.25% of assets per year11. The exact percentage should decrease as your portfolio size increases. Be wary of firms charging commissions or hourly fees in addition to AUM fees7.
Always verify fee transparency upfront by reviewing Form ADV and requesting sample invoices. Ensure fees are competitive given the firm's credentials, services provided, and clientele served23.

Reputation and Experience

Look for firms with long track records serving high net worth individuals and business owners specifically. Ask for client references and search online to read independent client reviews5.
Verify advanced designations (CFP, CFA, etc.) and check regulatory records for any disciplinary history21. Firms should have reputable wealth management partners and credentialed, experienced advisors on staff4.

Clientele and Specializations

The ideal firm specializes in serving high net worth clients with at least $5 million to $20 million in investable assets123. Ask about average client size and proportion of clients meeting the SEC's high net worth accreditation standard.
Seeking niche expertise in areas like executive compensation, business exit planning, trust administration, and complex tax situations can provide further value for high net worth families616.

Trust and Communication

Financial planning is a long-term partnership built on transparency and trust9. Make sure firm advisors take time to understand your family values, goals, concerns, and vision for your wealth. Expect regular reviews and clear reporting to track progress over time22.