Wealth management is about managing your wealth or surplus funds to achieve a financial goal, e.g. to ensure capital invested is kept intact or the investment risks are well managed at all times.
Wealth is defined as your net assets 1, after deducting your debt (or liabilities 2).
You often hear about wealth management for the rich or high net-worth individuals. However, wealth management is not only for individuals but is also applicable for business.
Benefits of Wealth Management
Benefits of wealth management include:
- Better utilisation of free funds
- Minimising tax on investment
- Maximising return on investment on a given risk appetite
Wealth management is about managing your wealth or surplus funds to
achieve a financial goal
The next few Knowledge Base issues provide basic information on aspects of wealth management that may be undertaken by small and medium enterprises (SMEs) in managing their assets to achieve their financial goals.
- Asset - Any item of economic value owned by an individual or a corporation. Examples are cash, securities, accounts receivables, stocks, office equipment, houses, cars, and other properties.
- Liability - A financial obligation or the cash outlay that must be made at a specific time to satisfy the contractual terms of such an obligation.
Reprinted with permission from BankingInfo (A Consumer Education Programme by Bank Negara Malaysia)
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