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Starting with the End in Mind: Goals-Based Wealth Management


By: Jan Paul Ferrer


Life is a series of choices, and when it comes to your wealth, the choices you make today could have far-reaching or unexpected effects on your financial life. To help ensure you can achieve the future you envision, you need a long-term plan. But before you can create that plan, you need to know where you want to go.

In the past, wealth management was virtually synonymous with investment management. But today, an increasing number of Financial Advisors and firms have moved toward a more modern approach to managing wealth: Goalsbased wealth management.

Goals-based wealth management helps you manage your wealth to achieve your goals, rather than to achieve an arbitrary rate of return. This approach to wealth management gives you a more accurate picture of where you stand in relation to your most important aspirations and what you will need to do to make those aspirations a reality.

Benefits of Goals-Based Wealth Management

Because it is based on your unique goals, a goals-based wealth management strategy is custom-designed to fit your circumstances. In addition, goals-based wealth management can help you:

1. Develop a comprehensive view of your wealth. Rather than just focusing on your investment portfolio, goals-based wealth management takes a holistic view of your wealth, including your current income, future earning potential, retirement plans(s), and Social Security, as well as your current liabilities and future expenses.

2. Integrate estate planning into your overall wealth management strategy. Goals-based wealth management incorporates estate planning considerations into the wealth management process from the beginning.

3. Tailor risk management to your preferences. Goals-based wealth management defines risk in terms of the probability of achieving your goals, not just in terms of market volatility.

4. Make more informed financial choices. When you have a comprehensive view of your wealth, you have a greater sense of clarity and control over your financial life.

5. Feel more confident about your investment decisions. Measuring success by your progress toward your goals, rather than against market benchmarks, can help prevent emotional investment decisions.

Putting Goals-Based Wealth Management into Practice

An experienced Financial Advisor can help you implement a goals-based approach to wealth management using a disciplined four-step process. The first—and often the most important—step is discovery, an honest, open conversation about your goals and your entire financial picture. In the second step, your Financial Advisor works with you to assess various scenarios and advise on appropriate strategies designed to help you meet your goals. Once you have agreed on a plan, your Financial Advisor recommends a combination of accounts and products that will help you meet your spending needs and invest in a tax-efficient manner. Finally, as time progresses, your Financial Advisor will periodically review your financial situation with you, making adjustments according to your needs, life events and changing market conditions. If you’re ready to stop chasing returns and start focusing on what really matters to you, talk with a Financial Advisor about how you can put goals-based wealth management into action.


Article by Morgan Stanley and provided courtesy of Morgan Stanley Financial Advisor. Jan Paul C. Ferrer is a Financial Advisor in Chicago, IL at Morgan Stanley Smith Barney LLC (“Morgan Stanley”). He can be reached by email at janpaul.ferrer@ morganstanley.com or by telephone at 312 312-419-3535 Morgan Stanley Smith Barney LLC (“Morgan Stanley”), its affiliates and Morgan Stanley Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for matters involving trust and estate planning and other legal matters. This article has been prepared for informational purposes only. The information and data in the article has been obtained from sources outside of Morgan Stanley. Morgan Stanley makes no representations or guarantees as to the accuracy or completeness of the information or data from sources outside of Morgan Stanley. It does not provide individually tailored investment advice and has been prepared without regard to the individual fi nancial circumstances and objectives of persons who receive it. The strategies and/or investments discussed in this article may not be suitable for all investors. Morgan Stanley recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Financial Advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Jan Paul C. Ferrer.may only transact business, follow-up with individualized responses, or render personalized investment advice for compensation, in states where [he/she] is registered or excluded or exempted from registration, http://www.morganstanleyfa. com/ferrer. oker Check http://brokercheck. fi nra.org/Search/Search.aspx]. © 2018 Morgan Stanley Smith Barney LLC. Member SIPC. CRC 2283209 10/2018

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