What is Total Wealth Management (TWM)?

When I was 14, I read a book called Rich Dad Poor Dad that flipped the switch for me, shedding light on a passion I had that I never knew existed: Personal Finance. Luckily, I had the opportunity to start an internship after school at a local financial firm. It didn’t take long for the “new kid” to have a couple ideas from an outsider’s perspective.

This is what I discovered: Can you relate to Joe?

Joe has worked for the City for 25 years and has to take off early today to run errands. Joe has a busy afternoon so he speeds over to a meeting with his financial advisor. He makes it into the conference room and asks his advisor about his plan; “are we on the right track?” The financial advisor acknowledges everything is fine and, after an hour the meeting concludes another annual review in the books. As he pulls out of the advisor’s parking lot, Joe’s wife sends him a text reminding him that he needs to hurry across town to their CPA’s office to finish up this year’s taxes. He tells her he is on his way and will have to meet her there. He makes it five  minutes late, enters the CPA office, and joins his wife in time to find out they are not getting a tax refund this year. After the meeting is over, in the parking lot, he forgets that he hasn’t even asked his wife how her day has been. They look at the time and realize they still have one more appointment to make for the day. She decides they should just ride in the same car over to meet with their estate-planning attorney. The attorney blows the dust off their legal documents and shares with them that their power of attorney is now out of date needs to be updated. They sign over a check for her retainer, shake hands, and head home for the night. While on their way home, their property casualty insurance agent calls and tells Joe that the deductible on his home insurance is probably too high. He asks Joe if can he come by sometime for a chat? Joe says he is driving but will check his calendar tomorrow.

Joe is pretty sure the professionals he counts on for advice have never made an effort to collaborate and confer on his behalf to help ensure the couple are headed on the right path, or work together to put a comprehensive plan in place. Sadly, Joe ponders this dilemma and comments to Karen that their advisors likely don’t even know each other’s names.

All of this coordination is exhausting, and Joe feels short on both the time and energy it takes to put all these pieces together. He always feels like their problems are falling into the cracks between where one professional ends and another begins. Those cracks may be hardly noticeable at first glance, but Joe is learning that in life it’s not the large cracks that trip us up but the small ones we don’t see that do the most damage.

Joe’s story is one I have witnessed far too many times. It is why I started SWAN Capital, because I have always been a believer in Total Wealth Management: an approach with the goal of filling in these cracks with deliberate and intentional collaboration.

Teamwork always produces better results than having professionals swim ignoring the other swim lanes beside them. Here are some things to look for when building your total wealth management team:

1. Find professionals who play well with others. You want advisers who check their ego at the door, who don’t think their profession or role is more honorable than someone else’s. Avoid those who hold too tightly to the idea that they should control everything; collaboration is the key.
2. Choose an advisor who is held to the fiduciary duty of care. It would appear to be common sense for advisers to put your best interest ahead of their own; however, we have found this is not so common. The fiduciary duty of care is lawfully obligated to maintain your best interests as the focus of recommendations while avoiding any conflicts of interest. The regulatory standard that applies is the suitability standard, which means that the recommendation meets your needs and objectives.
3. Put it on the calendar – To ensure they will actively meet to discuss your situation, it’s a great idea to schedule the first joint review and invite your advisors to be present together at a round table meeting.
4. Find team players with a long tenure. You want to hire advisors who will be in the business for a long time. You don’t want to be scouting for new players at the beginning of each new season of life. Find a firm with a reputation for being proactive rather than reactive.
5. Determine the quarterback. The team leader can help harmonize all the professionals to see the big picture and how all the puzzle pieces fit together. The team leader can be your accountant, your attorney, your insurance agent or your financial adviser –

whoever has the best disposition for the job. That person should be your go-between, responsible for making sure everyone is communicating and that you’re kept in the loop.

• Cast for professional experience. Hire individuals who have the experience with your profession and line of business. If you’re getting up in age, you may want an elder-law attorney. If you’re close to retirement, you should have a financial adviser who is transitioning your portfolio from the accumulation phase to the distribution phase, and a tax professional focused on your entire tax liability – not just a yearly refund. If you have a business, it is essential that you have someone in risk management who understands the threats your business could potentially faces, and matches property and casualty insurance to help shield you from those concerns.

It would be nice if all of these professionals were under one roof. However, if they are within a 30-minute radius from you, that is ideal. It will make it easier for you to meet with them, and for them to meet with each other.

Their goal should be to help you reach your goals. And you can all start by closing up any cracks in the path to financial success.

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM) and/or Swan Capital. AEWM and Swan Capital are not affiliated companies. A hypothetical example is provided for illustrative purposes only; it does not represent a real-life scenario and should not be construed as advice designed to meet the particular needs of an individuals’ situation. Insurance products are sold based on the suitability standard at both the state and insurance carrier level; this means that product recommendations must meet the stated financial needs and objectives of the client. Investment advisory services are required to be provided in accordance with a fiduciary standard- this means that the advice must be in the best interest of the client with any conflicts of interest fully disclosed to the client. 00602122