Building Your Wealth Management Team

Building the right team is one of the most critical steps to protect your wealth and achieve your goals.

There are few decisions along the executive journey as important as determining whose advice you will rely on. Selecting the right advisors, leveraging the resources available at work, and creating a plan to ensure that your and your partner's visions are aligned are critical steps in building a successful team.

Find the Right Advisors

Selecting your team of advisors is, as the saying goes, both art and science. Ultimately, your team is likely to include a financial planner, tax preparer and advisor, and trust and estate planner. In addition to selecting advisors and firms who are equipped to adapt to the evolving complexity of your needs, it is important that the team communicates well, collaborates rather than competes and, most importantly, is aligned with your goals, risk-tolerance and the nuances of your specific needs.

Initiating conversations with a current trusted advisor is a good place to start. Additionally, as detailed in Leverage Company Resources, seeking the advice of predecessors in your role as well as your peers can be helpful – particularly as it is often beneficial for advisors to be familiar with your company’s compensation and benefit structures.

When evaluating advisors, consider expertise, experience and empathy.

Expertise

Research, vet and interview multiple advisors. Learn about the licenses and credentials they possess to determine whether they have the expertise to provide the advice you require.

Experience

Ensure your advisors have extensive experience with the different components of your executive compensation. The financial advisor you choose, for example, should have significant experience helping clients with deferred compensation, section 83(b) elections, option tracking and rule 10b5-1 plans.

Empathy

Understanding is essential. Your advisors should undertake a holistic approach to support the realization of your personal fulfillment as you strive to accomplish your goals. Your advisors’ cadence, communication and strategy should be compatible with you and your partner, if you have one. Match and fit matter.

Questions to consider

When evaluating advisors, consider asking the following questions:

• How many executives do you work with, and what are their roles? Fewer are often better. You are seeking advisors who cater to your complex needs and can devote appropriate time and resources. Ensure that the advisor has experience working with clients whose compensation sophistication is on par with your own.
• Can you put me in touch with current clients? Whether it’s your colleagues or executives at other companies, references are critical.
• Can you explain in detail how you are compensated? Advisors in this space are often incentivized to sell insurance packages that may not suit your needs. Be wary of those who tout no fees or inordinately low fees. In the financial planning space, consider a straightforward planning fee for objective advice and advisors who put a premium on building relationships with you and, potentially, your family for generations.

Leverage Company Resources

Your company is a powerful resource for building your team – not only due to the tools and information it makes available to you, but also because of the institutional knowledge of your peers and predecessors.

• Know what is available. While most companies do not offer comprehensive planning for executive leadership, there is likely still an array of tools at your disposal. Some firms, for instance, offer tax preparation, a degree of financial planning, or an executive planning benefit to senior leadership. Additionally, human resources may have a list of approved providers. And while human resources is not likely to make hard recommendations, it may share that the majority of executives in your position have traditionally opted to work with a certain provider.
• Talk to your predecessor. While discussing team building with your predecessor can be sensitive due to dynamics such as the circumstances of their departure, no one is likely to know your situation better than the person who was in your chair before you. If you are comfortable enough in your relationship with your predecessor to do so, reaching out can be a valuable exercise.
• Talk to your peers. In addition to discussing views on general best practices with your peers, there is often value in working with advisors who know your company’s compensation and benefit structures.

Create a Cohesive Plan at Home

If you have a partner at home, determine the degree to which you and your partner will be involved in wealth planning and investment management. At a minimum, you will want to agree on an ongoing communication strategy and alignment on household finances.

A good place to start is by asking a series of questions. While specific questions will vary depending on relationships, needs and backgrounds, variations on the following can be effective starting points:

• Are you aligned on financial goals and spending? Does one partner value collecting art while another values experiences? Are you aligned over expenditures such as vehicles, travel and philanthropic giving? What appears to be inappropriate spending could simply be a blind spot. Answering difficult questions on values can lead to more productive planning and less anxiety.
• Does delineation of duties make sense? The complexities of optimizing long-term wealth, healthcare and estate planning can benefit from delineation of duties. Even in the event, however, that one partner’s background makes them better suited to maintain relationships with accountants, bankers or attorneys, be deliberate about operating in silos. While in some situations doing so is appropriate, in others it is better if partners are informed – particularly in the event that one partner is too busy to communicate with advisors.
• Who has capacity and interest to address specific needs? Just because one partner appears more qualified to address a specific area does not necessarily mean they should run point on it – they could be limited by time constraints or, simply, lack of interest. Work toward creating a realistic, sustainable strategy.

Next Steps

• Talk to your current advisor(s) and interview new advisors
  If you have a current trusted advisor, seek recommendations on other advisors and firms who are positioned to grow with you as your planning needs become more complex
• Leverage company resources
  Initiate conversations with your peers, human resources department and, potentially, your predecessor.
• Align and strategize with your partner
  Work with your partner to create a strategy for ongoing wealth-planning discussions and, if appropriate, delineation of responsibilities.