Complete financial freedom is the pinnacle of luxury in a society where political and economic upheaval is the norm.
Due to the growth of sophisticated wealth management software, many High-Net-Worth (HNW) and Ultra-High-Net-Worth (UHNW) individuals are taking control of their money or giving it to a small team of trusted financial advisors to manage through a family office.
“In an uncertain market, the ultra-wealthy are looking for ways to protect their assets, and having a direct hand lets them make quick, personal decisions,” Cosimo Violati, Head of Business Development at Altoo, says. “This also gives them a bigger say long-term in how their assets are managed, so they can make sure their long-term and short-term investments match their personal goals and values.”
The story of Altoo began in late 2017 in Zug, Switzerland, in the midst of a unique situation involving a closing bank. The technology that kept the bank running was recognized as having potential beyond its original application. This was the spark that ignited the birth of this Swiss fintech, as the technology’s potential for the UHNW market was realized and embraced.
Altoo’s integration of the latest technologies into the traditionally conservative banking and investment industry has been innovative. As a nimble, independent entity, Altoo is able to respond quickly to new trends and customer demands. The wealth management platform is constantly updated, and security, a cornerstone of Altoo’s delivery and development, remains a non-negotiable priority.
What are the benefits of HNWIs and UHNWIs managing their own wealth?
Control and Flexibility: Managing wealth directly allows HNWIs and UHNWIs to have full control over their investment decisions and financial strategies. They can react quickly to market changes, adjust their portfolio allocations, and take advantage of emerging opportunities without relying on external advisors.
Cost Savings: By handling their own wealth management and financial planning, HNWIs and UHWNIs can avoid paying high fees to professional financial advisors. While some may choose to work with advisors for specific needs, reducing the reliance on external advisors and wealth managers can lead to significant cost savings over time.
Aligned Interests: HNWIs and UHNWIs who manage their wealth directly have a personal stake in their investment outcomes. Their interests are wholly aligned with their financial decisions, eliminating concerns about potential conflicts of interest that can arise with external advisors.
Why are an increasing number of wealthy individuals opting to manage their own wealth?
The growing desire for HNWIs and UHNWIs to manage their own wealth is not only driven by economic and political uncertainty but also by a rapidly evolving financial and investment environment.
According to Violati, wealth management has transformed significantly over the last decade, with a rise in various assets, including digital ones such as cryptocurrencies.
Violati explains: “This has made wealth management more complex, demanding more personalized and sophisticated strategies beyond traditional stocks and bonds.”
He adds: “ESG has also been a trend in the last five years. In today’s age of higher inflation and deglobalization, income-generating investments and commodities are becoming more popular, while the traditional 60/40 portfolio has quickly shown its weakness in a non-deflationary environment.”
Furthermore, an increasing number of HNWIs and UHNWIs want to invest in sustainable assets to ensure a financial legacy they are proud of.
By managing their wealth in-house, they can ensure their investments are in line with their own morals and help support practices that are good for the environment and society. However, managing complex assets, especially without a family office, can be difficult and risky for affluent people.
What are the risks of HNWIs and UHNWIs choosing to manage their own wealth?
Risks include the complexities of managing a diverse portfolio, keeping up with the latest investment trends and regulatory changes, and the potential for emotional decision-making that can lead to riskier investments. That said, it is rarely the case that HNWIs or UHNWIs will make high-priority financial decisions without being advised by their bankers, wealth managers, or internal team.
How can wealth management technology help?
Altoo’s award-winning Wealth Platform is an example of advanced software that provides HNWIs and UHWNIs with a holistic view of their wealth. It offers an intuitive dashboard that provides clear, real-time information on all assets as well as vital market data. This real-time knowledge aids decision-making, reduces the likelihood of anything being overlooked, and aids in maintaining a well-balanced, diversified portfolio.
The benefit of a wealth management tool like Altoo is that the program can accommodate a variety of circumstances. Some HNWIs and UHNWIs, for example, may prefer to directly manage their financial affairs, but others may hire specialized staff or establish a single-family office to manage their money on their own. The strategy might differ substantially based on the individual’s preference, the complexity of their assets, and their willingness to be involved in day-to-day financial management. Altoo has the advantage of being adaptable to these particular requirements.
Just some of the benefits of using an advanced wealth management software, like Altoo, include:
- Financial reporting and analysis, with up-to-date data providing a real-time investment analysis both now and of your projected financial future
- Estate planning, with all documents stored in one central and secure place, facilitating the smooth transition of assets
- Budgeting and expense tracking with real-time data
- Investment management, including portfolio tracking and asset allocation tools, with 24/7 real-time data on the progress of investment portfolios, including traditional and exotic investments
- Tax planning tools, including tax calculators, income tax estimators, and tracking tools for tax-deductible expenses.
To learn more about the benefits of managing your own wealth and how sophisticated wealth management tools can help, contact Altoo.
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