Morgan Stanley
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Prosperity Begins with a Well-Defined Wealth Plan

Individual investors need a comprehensive wealth management strategy for their changing goals and priorities.

Life is about change. So is wealth management. As investors move through the stages of life, they face a succession of financial challenges. Some challenges, like the need to prudently manage the relationship between investment risk and return, start early and never go away. Others, like estate planning, come later in life. These changing goals and priorities can be summarized as a cycle with four broad stages:

  • WEALTH ACCUMULATION: During this phase, individuals are primarily focused on acquiring the assets they are likely to need to help meet their long-term financial goals.
  • WEALTH PRESERVATION: As investors move into their peak earning years, their financial focus may gradually shift from asset growth to risk management—protecting their families and their portfolios from unexpected adversity or market volatility.
  • WEALTH UTILIZATION: At some point, most individuals will need to draw on their accumulated resources to fund specific needs, such as college tuition costs or retirement expenses.
  • WEALTH TRANSFER: Many, if not most, affluent individuals hope to leave a sizable legacy for their children, their grandchildren and/or their communities.

It’s important to note that these stages overlap, and that the transition between these stages can be very gradual. This means individuals and their advisors must address a constantly changing mix of new and old financial problems. For example: Lengthening life expectancies, soaring medical costs and rising expectations for a comfortable standard of living all mean that even retired investors can’t ignore the need to continue balancing current income and capital growth.

Understand the Trade-Offs

Finding strategies to address these problems may require difficult trade-offs. To illustrate, investors need to decide what level of risk they are willing to accept in their attempt to achieve a given return objective. They may also have to choose between generating a high level of current income and a rate of capital growth sufficient to support a somewhat lower standard of living for a longer period of time.

These choices are never easy; they need to be made within the context of a comprehensive wealth management strategy. Because Morgan Stanley believes prosperity begins with a well-defined wealth plan, our Financial Advisors are well-equipped to analyze various aspects of your financial situation and advise you on a prudent course of action. Some of the services our Financial Advisors can provide include:

  • PERSONAL NET WORTH ANALYSIS: Helping you identify ways to consolidate debt and improve your monthly cash flow.
  • ASSET ALLOCATION ANALYSIS: Recommending a diversified asset allocation model tailored to your goals, tolerance for risk, and other factors.
  • EDUCATION FUNDING ANALYSIS: Analyzing the projected future cost of your child’s education and advise you on your funding strategy, including the use of Section 529 savings plans and other tax-favored vehicles.
  • RETIREMENT ANALYSIS: Helping you clarify your retirement objectives; evaluating your resources, expected returns and income needs; and calculating the probability of meeting your goals.
  • ESTATE PLANNING ANALYSIS: Using Morgan Stanley’s estate-planning tools, a Financial Advisor can help you determine ways to protect much of the wealth you have accumulated, so that it can be distributed according to your wishes.

A Team to Carry Out Your Strategy

For many, if not most, individual investors, the key to successful wealth management is having a disciplined, long-term investment strategy—and an effective team of investment professionals to carry out that strategy. This is where the resources available through Consulting Group, Morgan Stanley Wealth Management’s investment advisory unit, can play a crucial role. Consulting Group’s “open architecture” approach and array of nondiscretionary and discretionary investment programs provide clients with access to a variety of investment products and services. This includes asset allocation and advice on investment product selection, complemented by rigorous due diligence from our manager analysis team on both affiliated and independent third-party money management firms.

Many of these investment programs offer specific benefits that facilitate an integrated approach to wealth management. Unified managed accounts, for example, allow investors to consolidate different types of investment vehicles within a single account structure, while separately managed accounts may give investors considerable flexibility in managing their tax liabilities through the use of capital-loss harvesting techniques.

For clients with a minimum of $5 million in investable assets or more than $10 million in net worth, Morgan Stanley also offers access to our Wealth Planning Centers. These centers provide an experienced staff of highly credentialed professionals, including former trust and estate attorneys who remain current with tax rules, regulations and practices. They can help educate clients on proven strategies for working toward their wealth management goals and objectives, including risk management and philanthropy.1

Wealth management is, in essence, a model for serving the increasingly complex needs of today’s individual investors—particularly those with substantial financial assets. Morgan Stanley is committed to providing the tools, resources and personalized service that investors are looking for in an advisory relationship.

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