A Guide to Effective Wealth Management Integration

Effective wealth management integration is crucial for achieving financial success and stability. But managing wealth can be a complex and daunting task, especially with the ever-changing economic landscape and investment options available.

Without a solid wealth management plan in place, you may find it challenging to grow and protect your assets. This guide will provide you with the necessary tools and strategies to effectively integrate wealth management into your overall financial plan, helping you achieve your financial goals and secure your future.

• What is Integrated Wealth Management?
• Benefits of Wealth Management Integration
• What Are the 5 Steps of the Wealth Management Process?
• Top Wealth Management Platforms
• Key Features to Consider Before Picking a Wealth Management Tool

What is Integrated Wealth Management?

Integrated Wealth Management (IWM) is a comprehensive approach to financial planning and management that aims to address all aspects of an individual’s or family’s financial life. This comprehensive service encompasses a range of financial disciplines to provide coordinated and customized solutions tailored to the client’s unique needs and goals. 

The key components of integrated wealth management typically include:

• Investment Management: Developing and managing a diversified investment portfolio aligned with the client’s risk tolerance, time horizon, and financial objectives.
• Financial Planning: Creating a strategic plan that covers budgeting, saving, debt management, and retirement planning to ensure long-term financial stability and growth.
• Tax Planning: Structuring the client’s finances in a tax-efficient manner to minimize liabilities and maximize after-tax income and wealth.
• Estate Planning: Preparing for the distribution of the client’s assets after their death, including wills, trusts, and other legal arrangements to ensure their wishes are carried out and to minimize estate taxes.

What’s the Difference between Wealth Management and IB?

Wealth Management and Investment Banking (IB) are distinct areas within the financial services industry, each serving different client needs and employing different strategies.

Here are the key differences:

• Client Base: Wealth management serves individuals and families, while investment banking solely serves corporations, institutions, and governments.
• Services Provided: Wealth management focuses on comprehensive financial planning and investment management for individuals, whereas investment banking focuses on financial advisory, capital raising, and transaction facilitation for businesses and institutions.
• Approach and Objectives: Wealth management is about long-term financial planning and wealth preservation for individuals. Investment banking is more transactional, focusing on facilitating financial deals and raising capital.
• Nature of Work: Wealth management involves ongoing advisory relationships and holistic planning. Investment banking involves project-based, high-stakes financial transactions and strategic corporate advisory.

Benefits of Wealth Management Integration

Improved Workflows

One of the key benefits of integration is improved workflows. With different systems and data sources connected seamlessly, wealth managers can access and manage client information more efficiently. This eliminates the need for manual data entry and reduces the risk of errors or inconsistencies in client records. Improved workflows lead to time savings and allow wealth managers to focus on providing personalized services and advice to their clients.

Increased Productivity

Integration also enhances productivity by automating various processes. Tasks such as portfolio management, reporting, and compliance can be automated, freeing up valuable time for advisors to engage with clients and build relationships. Automated processes also reduce the likelihood of mistakes and ensure compliance with regulations, ultimately increasing the productivity and effectiveness of wealth management professionals.

Seamless Integration of Various Systems and Processes

An open and configurable platform like Advisor360° further enhances integration capabilities. This platform allows for seamless integration with flexible solutions, a partner ecosystem, and existing technology stack. 

Wealth managers can customize their technology environment according to their specific needs and easily integrate with third-party applications, such as CRM or financial planning tools. Such flexibility enables the effective management of the wealth needs of all stakeholders, including advisors, clients, and support staff, across all lines of business.

Enhanced Efficiency

By integrating wealth management solutions, financial advisors and wealth managers can streamline their operations, automate manual tasks, and enhance overall efficiency. Improved workflows and increased productivity together contribute to a more efficient and effective wealth management practice.

Optimized Technology Stack

In summary, wealth management integration offers significant benefits by improving workflows, increasing productivity, and providing seamless integration with flexible solutions. By leveraging an open platform like Process Street, wealth managers can optimize their technology stack and effectively meet the wealth management needs of all stakeholders.

What Are the 5 Steps of the Wealth Management Process?

The wealth management process encompasses a series of steps designed to help individuals and families effectively manage their financial resources and achieve their long-term financial goals. Here are the primary stages of the wealth management process:

1. Portfolio Audit

A portfolio audit is a crucial process in the evaluation and management of internally built portfolios. Internally building portfolios involves creating an investment strategy, selecting appropriate securities, and constructing a portfolio that aligns with the investor’s objectives and risk tolerance.

This process requires in-depth research, analysis, and expert decision-making. Once the portfolio is constructed, it is implemented by executing the investment transactions and maintaining the portfolio’s composition.

Managing portfolios internally provides distinct advantages. 

Firstly, it offers greater transparency as investors can directly access information about the portfolio’s holdings, transactions, and performance. This transparency allows investors to evaluate the performance and suitability of the portfolio accurately.

2. Investment Management

Investment management is a crucial component of wealth management that helps clients achieve their investment goals. It involves the careful selection, constant monitoring, and strategic optimization of investment portfolios.

As part of wealth management, investment management focuses specifically on the financial instruments and assets that will best help clients grow their wealth and achieve their long-term financial objectives. Whether the goal is to fund education expenses, save for retirement, or build a diverse investment portfolio, investment management plays a key role.

Through investment management, clients have access to a range of investment options, such as stocks, bonds, mutual funds, and real estate investment trusts (REITs). These options are carefully evaluated and selected based on various factors, including risk tolerance, time horizon, and financial resources.

3. Tax Planning and Preparation

Tax planning and preparation is an integral part of wealth management. Platforms like Advisor360° offer various features and capabilities to enhance the tax filing process. It seamlessly integrates with leading tax preparation tools such as TaxAct, TurboTax, and H&R Block, allowing users to easily transfer data and streamline their tax preparation workflow.

4. Advanced Financial Planning

Advanced financial planning involves the application of comprehensive knowledge and skills in the field of finance to develop strategic plans for individuals or organizations to achieve their financial goals. It goes beyond traditional financial planning by considering more complex financial situations and offering specialized solutions.

Advanced financial planning builds upon the knowledge and skills acquired in integrated wealth management. Integrated wealth management focuses on managing various aspects of an individual or organization’s financial well-being, such as investments, taxes, retirement planning, estate planning, and risk management. Advanced financial planning takes these aspects into account but also considers more intricate strategies and solutions to further optimize financial outcomes.

Key components of advanced financial planning include:

• In-depth financial analysis
• Goal-setting
• Risk management
• Tax planning
• Estate planning
• Investment strategies

These components are integrated to create a comprehensive financial plan tailored to an individual or organization’s specific needs and goals.

5. Private Banking and Reporting Services

Private banking and reporting services provide individuals with a seamless and efficient platform for managing their personal finances and tax preparation. One of the key features of this service is its integration with leading tax preparation tools. This integration allows for the automatic pre-filling of relevant fields, ensuring improved data accuracy and reducing the risk of errors during the tax preparation process.

By seamlessly integrating with tax preparation tools, private banking and reporting services greatly simplify the overall process of managing personal finances. Users can easily access their financial information, bank statements, investment records, and other pertinent data all in one centralized platform. This integrated approach eliminates the need for manual data entry and significantly speeds up tax preparation.

Top Wealth Management Platforms

Process Street

Process Street is a powerful tool for streamlining and automating workflows within a wealth management firm. Its strengths lie in its robust workflow automation, integration capabilities, and customizability, making it suitable for handling the administrative and operational tasks that underpin wealth management services. 

For wealth management firms looking to improve efficiency, ensure compliance, and enhance team collaboration, Process Street offers a versatile solution that can significantly benefit their operational processes.

Key Features: 

• Robust Workflow Automation: Wealth management involves numerous repetitive tasks such as client onboarding, portfolio reviews, compliance checks, and tax preparation. Process Street allows wealth managers to build detailed checklists for these processes, ensuring consistency and reducing the risk of errors.
• Integration Capabilities: Process Street integrates with a variety of other applications through Zapier and direct integrations, making it possible to connect with CRM systems, financial planning software, and document management systems. 
• Customizability: Wealth management firms can tailor workflows to meet specific regulatory requirements and client needs. Custom forms, conditional logic, and task assignments ensure that each process aligns with the firm’s operational practices.
• Collaboration and Communication: Process Street facilitates collaboration within teams by allowing multiple users to work on the same process. It supports task assignments, due dates, and real-time updates, enhancing communication and coordination among wealth management teams.
• Compliance and Documentation: Process Street helps ensure that all regulatory requirements are met by providing a clear audit trail of all activities. Each step in a process can be documented and tracked, making it easier to demonstrate compliance during audits.

Betterment

Betterment is a popular digital wealth management platform that offers automated investment management services. It combines technology with personalized financial advice to help users achieve their financial goals efficiently.

The tool uses algorithms to build and manage investment portfolios tailored to users’ goals, risk tolerance, and time horizon. Users set specific financial goals such as retirement savings, buying a house, or funding education, and Betterment creates customized investment strategies to achieve those goals.

Key Features:

• Automated Portfolio Management: Betterment automatically builds and rebalances investment portfolios based on users’ financial goals, risk tolerance, and preferences.
• Goal-Based Investing: Users can set multiple financial goals and track progress towards each goal separately.
• Tax-Efficient Investing: Betterment employs tax-loss harvesting and tax-coordinated portfolio strategies to minimize taxes and maximize after-tax returns.
• Low Fees: Betterment charges a competitive fee based on assets under management (AUM), with no trading fees or transaction costs.
• Customizable Portfolios: Users can adjust portfolio allocations and preferences based on their risk tolerance, investment horizon, and ethical considerations.
• Retirement Planning Tools: Betterment offers retirement planning tools, including retirement savings calculators and retirement income projections.

Finartis

Finartis is a comprehensive wealth management software designed to cater to the needs of wealth managers, family offices, and private banks. It offers a range of features and functionalities to streamline portfolio management, client relationship management, and financial planning processes.

The platform is designed to enhance the client experience by offering personalized services, detailed reporting, and interactive client portals. Finartis also provides an integrated platform that consolidates various wealth management functions, including portfolio management, client reporting, compliance, and financial planning.

Key Features:

• Portfolio Management: Comprehensive portfolio management tools for asset allocation, trade execution, performance tracking, and risk management.
• Client Relationship Management (CRM): Client-centric CRM features to manage client interactions, track communications, and maintain client profiles and preferences.
• Financial Planning: Robust financial planning tools for goal setting, cash flow analysis, retirement planning, and estate planning.
• Reporting and Analytics: Advanced reporting and analytics capabilities for generating client reports, performance analysis, and regulatory reporting.
• Compliance Monitoring: Built-in compliance monitoring tools to ensure adherence to regulatory requirements and internal policies.

BlackLine

BlackLine is a cloud-based finance and accounting software platform that streamlines financial close processes, improves accuracy, and enhances visibility into financial data. While it is not specifically designed as a wealth management tool, its features can be utilized by wealth management firms for financial reporting, reconciliation, and compliance purposes. 

The platform provides real-time visibility into financial data, allowing finance teams to track progress, identify bottlenecks, and ensure compliance with regulatory requirements. BlackLine also integrates with ERP systems, general ledger software, and other financial applications to streamline data exchange and workflow automation.

Key Features:

• Account Reconciliation: Automated reconciliation of balance sheet accounts, bank accounts, and intercompany transactions to ensure accuracy and compliance.
• Journal Entry Management: Streamlined creation, review, and approval of journal entries, with audit trails and controls to maintain data integrity.
• Variance Analysis: Comparative analysis of financial data to identify trends, anomalies, and areas requiring further investigation.
• Intercompany Transaction Management: Automated reconciliation and elimination of intercompany transactions to ensure accuracy and consistency across subsidiaries.
• Task Management: Assignment and tracking of tasks related to financial close processes, with reminders and notifications to ensure timely completion.

Addepar

Addepar is a comprehensive wealth management platform designed to provide investment professionals with the tools they need to effectively manage client portfolios, analyze performance, and streamline operations. 

The platform aggregates data from various sources, including custodians, banks, and investment managers, to provide a comprehensive view of clients’ financial holdings and transactions. Addepar also offers robust portfolio management capabilities, allowing wealth managers to aggregate and analyze client portfolios across multiple asset classes and investment vehicles.

Key Features:

• Portfolio Aggregation: Aggregates data from multiple sources, including custodians, banks, and investment managers, to provide a comprehensive view of client portfolios.
• Performance Analysis: Analyzes portfolio performance, attribution, and risk metrics to help wealth managers make informed investment decisions.
• Customizable Reporting: Generates customizable client reports and statements with interactive dashboards and visualizations.
• Data Visualization: Provides interactive data visualizations and charts to help wealth managers communicate complex financial information to clients.
• Risk Management: Monitors portfolio risk and compliance with regulatory requirements and internal policies, with alerts and notifications for potential issues.
• Integration Capabilities: Integrates with leading custodial and financial software systems to streamline data exchange and workflow automation.

WealthBlock

WealthBlock is a cutting-edge wealth management platform designed to empower investors with tools for managing their financial assets effectively. The platform offers comprehensive financial planning capabilities, helping users set goals, track progress, and make informed decisions about saving, investing, and retirement planning.

Users can monitor the performance of their investment portfolios in real-time, track asset allocation, and receive alerts for significant changes or opportunities. WealthBlock also offers educational resources and insights to help users improve their financial literacy and make informed investment decisions.

Key Features:

• Customizable Portfolios: Build customized investment portfolios tailored to individual financial goals, risk tolerance, and time horizon.
• Goal-Based Planning: Set and track financial goals, such as retirement savings, education funding, or wealth accumulation, with progress tracking and projections.
• Risk Assessment: Assess risk tolerance using comprehensive risk assessment tools and ensure that investment strategies align with risk preferences.
• Portfolio Monitoring: Monitor investment portfolio performance in real-time, track asset allocation, and receive alerts for significant changes or opportunities.
• Financial Planning Tools: Access comprehensive financial planning tools for retirement planning, tax optimization, estate planning, and more.
• Educational Resources: Access educational resources, articles, and insights to improve financial literacy and make informed investment decisions.

FinFolio

FinFolio is a comprehensive wealth management software designed to streamline portfolio management, client reporting, and financial planning processes for investment professionals. 

The platform offers customizable client reporting tools, enabling investment professionals to generate detailed performance reports, billing statements, and client communications. FinFolio also facilitates trade execution and portfolio rebalancing, allowing investment professionals to implement investment strategies and manage portfolio risk efficiently.

Key Features:

• Portfolio Aggregation: Aggregates client portfolios from multiple custodians and sources to provide a consolidated view of assets and holdings.
• Performance Reporting: Generates detailed performance reports, including time-weighted and money-weighted returns, benchmark comparisons, and portfolio analytics.
• Customizable Client Reporting: Creates customizable client reports and statements with branding options, interactive charts, and personalized messaging.
• Billing and Invoicing: Automates billing and invoicing processes, including fee calculations, invoice generation, and payment processing.
• Trading and Rebalancing: Executes trades and rebalances portfolios based on predefined investment strategies, model portfolios, and client preferences.
• Compliance Monitoring: Monitors portfolio compliance with regulatory requirements, investment guidelines, and client mandates, with alerts and notifications for potential issues.

Acorns

Acorns is a mobile investment app designed to help users save and invest their spare change automatically. The platform diversifies investments across different asset classes, such as stocks and bonds, to help mitigate risk and optimize returns.

The platform enables users to start investing with small amounts of money, making it accessible to individuals who may not have significant savings to invest. Users can choose from a selection of pre-built investment portfolios based on their financial goals, risk tolerance, and investment preferences.

Key Features:

• Round-Up Feature: Automatically rounds up users’ purchases to the nearest dollar and invests the spare change into a diversified portfolio.
• Recurring Investments: Allows users to set up recurring investments on a daily, weekly, or monthly basis to grow their investment portfolio over time.
• Found Money: Partners with various brands and retailers to offer cashback rewards that are automatically invested into users’ Acorns accounts.
• Portfolio Customization: Offers a selection of pre-built investment portfolios based on users’ risk tolerance and investment preferences.
• Goal-Based Investing: Enables users to set financial goals, such as saving for retirement, buying a home, or funding education, and track progress over time.

Asset Panda

Asset Panda is a comprehensive asset tracking and management platform that can be utilized for managing various types of assets, including financial instruments and investments. The platform offers a customizable asset database where users can store detailed information about their financial instruments, including purchase history, depreciation, and ownership.

The software integrates with financial software systems, such as accounting and portfolio management software, to streamline data exchange and enhance functionality. Asset Panda also provides robust asset tracking capabilities, allowing users to track the location, condition, and value of their financial assets in real-time.

Key Features:

• Customizable Asset Fields: Allows users to create custom fields to capture specific information about their financial assets, such as asset type, purchase date, cost basis, and current value.
• Barcode and QR Code Scanning: Supports barcode and QR code scanning capabilities, enabling users to quickly and accurately identify and track financial assets using mobile devices.
• Asset Audits: Facilitates asset audits and reconciliation processes, allowing users to verify the accuracy and completeness of their financial asset data on a regular basis.
• Depreciation Tracking: Tracks asset depreciation over time, providing users with insights into the value of their financial assets and helping with financial reporting and tax planning.
• Asset Maintenance: Allows users to schedule and track asset maintenance activities, such as repairs, upgrades, and inspections, to ensure the proper functioning and longevity of financial assets.

FundCount

FundCount is an integrated accounting and investment management software solution designed for wealth managers, family offices, and hedge funds. The platform offers customizable reporting and analytics tools, allowing users to generate detailed performance reports, client statements, and regulatory filings.

Users gain compliance monitoring features to ensure adherence to regulatory requirements, investment guidelines, and client mandates. FundCount also integrates with custodial and financial software systems to streamline data exchange and enhance functionality.

Key Features:

• Integrated Accounting: Provides comprehensive accounting capabilities for tracking investments, financial transactions, and portfolio performance.
• Portfolio Management: Enables users to manage investment portfolios, including asset allocation, trade execution, and performance tracking.
• Investment Analysis: Offers robust investment analysis tools for evaluating portfolio performance, risk exposure, and investment strategies.
• Compliance Monitoring: Monitors compliance with regulatory requirements, investment guidelines, and client mandates, with alerts and notifications for potential issues.
• Customizable Reporting: Generates customizable reports and statements for clients, regulators, and internal stakeholders, with options for branding and formatting.
• Data Aggregation: Aggregates data from multiple sources, including custodians, banks, and investment managers, to provide a consolidated view of investment portfolios.

Key Features to Consider Before Picking a Wealth Management Tool

Robust Security Measures

A wealth management tool should have robust security measures to protect sensitive client data. With the rise in cyber threats, it is crucial to have encryption and multi-factor authentication to ensure that client information is safeguarded. This feature is aligned with the digital revolution as more financial transactions are being conducted online, and it enhances personalized client services by instilling trust and confidence.

Comprehensive Suite of Features

The tool should have a comprehensive suite of features to handle various aspects of wealth management. This includes portfolio management, financial planning, and investment analysis. By having all these features in one tool, advisors can efficiently manage their clients’ portfolios and tailor their strategies to meet their unique needs. This aligns with the digital revolution by streamlining processes and making it convenient for clients to access their financial information anytime, anywhere.

Integration with Other Digital Platforms

Integration with other digital platforms is vital. A wealth management tool should seamlessly integrate with external systems such as banking platforms, tax software, and accounting tools. This integration allows for real-time data sharing and eliminates manual data entry, saving time and reducing errors. It enhances personalized client services by providing a holistic view of the client’s financial situation and enabling tailored advice.

User-Friendly Interface

A wealth management tool should have a user-friendly interface that allows both advisors and clients to navigate easily. This feature ensures that users can quickly access and understand the information they need, enhancing the overall experience. A well-designed interface aligns with the digital revolution by promoting accessibility and efficiency in managing financial information.

Advanced Analytics and Reporting

The tool should offer advanced analytics and reporting capabilities. This feature allows wealth managers to generate insightful reports, track performance, and make informed decisions based on data-driven insights. Advanced analytics help in identifying trends, financial risks, and opportunities, which are essential for personalized client services and strategic planning.