Human management

How to start a career in wealth management, according to experts

The barriers to starting a career in wealth management have always been extremely high, closing the industry to a small group of established families. Inherited wealth, in particular, tends to be passed down from generation to generation through the same hands.

But a decade-long global wealth boom, with a 9.3% increase in UNHW population in 2021 alone, has created more work and will require more labor. For spear staff members, the expansion of the industry was summed up by the Spear 500which has evolved through eight editions into a cornucopia of wealth management services.

This expanding universe is dotted with essential services: private bankers who help HNWs obtain credit and orchestrate co-investments; private investment managers who manage a client’s portfolio; and financial planners who develop accounting strategies for an HNW’s future plans. Beyond these basic services, asset managers will specialize in everything from yachts and jets to watches and fashion.

Whatever role you wish to pursue, Mark SomerFounder of Wealth Management Recruiters The Somers Partnership, would advise getting a qualification in financial planning first. “Rich people want someone who can tell them what age they can retire or what they can buy,” he explains. “Being someone a wealthy person would trust to plan their future is incredibly valuable.”

It’s also incredibly competitive. Talent poured in from investment banks as bank chiefs cut jobs in the wake of the pandemic; the rise of New York, Shanghai and Hong Kong as financial centers has opened the sector to global competition.

None of this should deter anyone from starting a career in wealth management. The competition can be fierce, but the industry rewards a keen eye for changing trends.

So how do you launch a career in wealth? First, you will need to obtain the necessary qualifications to advise HNWs on their finances. Since 2013, CISI, which oversees the industry, has required all licensed wealth managers to obtain “level six or seven” accreditation before advising HNWs on their finances. To explain this in simple terms, level six would equate to a BA while level seven would take you into postgraduate territory. Expect this to be followed by regular assessments to ensure you are up to date with ever-changing regulations.

Those with pre-existing financial qualifications can take a shorter route into the wealth management industry. People who have passed all three levels of the CFA can jump over the barriers around the wealth management industry by taking what is called a “regulatory paper”. Previous experience in the financial industry can also reduce the time bosses ask you to spend shadowing and developing your own counseling skills.

Armed with industry certification, would-be industry titans can begin building their contact books. It may take time. According to analysis by The Somers Partnership, the average private banker’s portfolio totals £350m and brings in £2.7m in revenue a year, while the average private investment manager will handle £220m in assets and will generate £2.2m in revenue.

The bulk of these books will be built through reputation, but personal contacts can also come into play. One Spear’s contact left investment banking to manage an acquaintance’s multi-billion dollar investment portfolio and begins to build a team to help with broader financial management.

Such opportunities are rare, but a solid reputation will put you in the right positions. To create one in the world of wealth management, you need a holistic view of your client’s finances that allows you to spot potential pitfalls on the road ahead and develop a strategy to guide your client through security.