NEPC’s Karen Harding was quoted in a recent U.S. News & World Report article to provide insight into how advisors work with ultra-high-net-worth clients to preserve generational wealth. View the article on U.S. News’ site here.
Managing a billionaire’s finances may entail intricate financial instruments, such as trusts, foundations, and investments in various industries and asset classes. In addition, tax optimization and estate planning become paramount to preserving wealth across generations.
While allocating into a balanced portfolio of cost-effective exchange-traded funds is frequently a winning strategy for mass affluent clients, that’s usually not enough for a billionaire’s assets.
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“A trusted advisor will work alongside clients to help create and execute a customized portfolio based on their client’s needs and objectives,” says Karen Harding, a partner in the private wealth practice at Boston-based NEPC.
The factors a billionaire’s advisor considers include goals and objectives, risk tolerance, tax status, cash flow needs and entity structure in order to build an appropriate portfolio, Harding says. Here are some of the criteria billionaires use when selecting financial advisors to handle their wealth:
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“With over three decades of experience working with ultra-high-net-worth clients, we often see a focus on maintaining multi-generational wealth,” Harding says.
“One consideration to keep in mind is that clients often still own the operating business which created their family’s wealth,” Harding adds. “If this is the case, the investment portfolio needs to take the operating business into consideration when decisions are being made for the investment portfolio.”
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Harding says billionaires seek advisors with whom they have a strong alignment and no conflicts of interest.
“They tend to work with advisors who have the deep resources required to successfully execute their desired plan, who have the technical skills required to create and implement a sophisticated portfolio,” she says.
Click here to continue reading the full U.S. News & World Report article.