The Seacoast Bank Note

Expert Interview Series Mike Kane About Why Entrepreneurs and Small Businesses Need Wealth Management

Posted by Seacoast Bank on Mar 14, 2016 11:47:02 AM


Do you own your own business? If so, you know that running and managing the day to day operations can be all consuming. With everything that happens, taking time at the end of the day to make sense of your money can add unnecessary stress to the fold.

Why give yourself cause for worry? Especially when you can both remove the stress and put it in the hands of someone responsible who can grow and invest your money, making it work for you while you work for more.

Want to learn more about how to make it happen? We recently checked in with Mike Kane, Co-founder, CEO and CIO of Hedgeable, to get his advice. Why do all entrepreneurs and small business owners need wealth management?
Entrepreneurs are focused on running a business. It's important that someone helps them with money management and takes that responsibility off of their hands. This lets them use their talents best, without having added worry and stress over their finances.

Wealth management is how you make the most of the money you earn. Investing isn't only for entrepreneurs and small business owners. Everyone should invest for their future. We are lucky enough to live in a time where there are many options available for beginners. Investing has never been more fun or interactive!

Are there do-it-yourself approaches to wealth management and what are the pros/cons to using them?
Anyone can do money management. The problem is that it takes time to educate yourself on sophisticated strategies as well as the discipline needed to avoid getting emotionally involved. It's easy to have an emotional, knee-jerk response to the market, but it's important to ride out the market and stay long term. Expert guidance helps investors stay their course and helps them not do the wrong thing at the wrong time - like selling an entire portfolio at the bottom of the market. Also, with expert guidance, you can learn about downside protection and investing in alternatives. Some of the other cons are account minimums, fees and a very general, cookie cutter approach.

What is the difference between "wealth management" and having a "financial advisor?"
Well, part of a financial advisor's job is to help their clients with wealth management. But, the number one job of a financial advisor is to grow their client base, especially if they are in the first five to 10 years of their career.

A financial advisor helps you with your goals and reminds you that it's important to invest long term. When investing, a financial advisor can help you with understanding your risk willingness, loss aversion, volatility tolerance and constructing a portfolio that reflects these things.

An important distinction is the fees that a financial advisor may charge, which can be as high as 2 percent. These fees are for the advice and counsel. By democratizing this process, we are able to dramatically lower these fees and provide sophisticated asset management services.

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