3 Questions Every $1 Million Investor Should Ask Their Financial Advisor
Written by
Dawn Allcot
Edited by
Jenna Klaverweiden
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Traditionally, $1 million was the magic money marker that signified real wealth. “While $1 million was historically the traditional ‘entry-level’ for private wealth, many firms now look for $5 million to $10 million before they can truly deploy more sophisticated solutions,” said Kevin Reed, chief revenue officer of Aquilance.
Your needs may change when you hit $1 million, $5 million or $10 million, depending on your lifestyle. As your net worth grows, ask your financial advisor these questions to determine whether it’s time to move on or expand the team of financial experts helping you grow and preserve your wealth.
What Fees Am I Paying?
As the focus shifts to wealth preservation, it’s important to check in and find out how much of your money is going to fees. “As assets grow, the percentage-based fee should ideally face downward pressure,” Reed said.
You want an advisor who offers high-touch service — and you want to understand exactly what you’re paying for.
Do You Offer Services Beyond Financial Planning and Investment Management?
As your net worth grows, your responsibilities may also grow — especially if you have active investments like real estate or multiple businesses.
“Families with $1 million can have administrative and operational complexity that requires an advisor to offer more than just investment management,” Reed said.
Working with an advisor who provides family office services, like bookkeeping and bill paying, can free up time, which becomes your most valuable asset once your net worth hits seven figures.
How Does Your Investment Philosophy Change for a Client at $1 Million vs. $100K?
This question lies at the core of finding a financial advisor who fits your needs. Reed said an advisor who doesn’t change their strategy or philosophy as a client’s wealth grows could be a red flag that it’s time to move on.
“Larger portfolios allow for access to alternative investments, private equity or more customized individual security sleeves that aren’t practical for smaller accounts,” he said.
Your lifestyle may not magically change when your net worth hits $1 million, but it’s a good time to reevaluate your financial plan and the experts you rely on.
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