Wealth management is a strategy that makes rich people stay rich, get richer and be able to pass on their wealth. The following is a more detailed explanation of wealth management.

What is Wealth Management?

The following is an explanation of wealth management from several sources:

Tandelilin (2010) Wealth management adalah jasa manejemen atau pengelolaan kekayaan yang komprehensif, termasuk di dalamnya: manajemen investasi, manajemen asset, manajemen portofolio, manajemen pajak dan asuransi.

Dock David Treece (2022) Wealth management adalah proses pengambilan keputusan atas asset, investasi, perencanaan pajak, perencanaan waris dan hal-hal terkait keuangan. Tujuan utama wealth management adalah mengamankan, menumbuhkan dan mewariskan kekayaan Anda.

Roger Wohlner (2022) Wealth management adalah layanan yang bersifat menyeluruh untuk membantu orang-orang kaya menumbuhkan kekayaan, mengelola utang dan strategi mewaariskan kekayaan mereka.

Melvin Mumpuni CFP® (2022) Wealth management is the process of managing one's wealth for both preservation and distribution to heirs.

What types of people will benefit from Wealth Management Services?

Wealth management services are suitable for High Net Worth Individuals or Ultra High Net Worth Individuals

Notes Net Worth is the difference between assets and liabilities.

• High Net Worth Individuals are people with a net worth of at least 1 million USD (equivalent to Rp. 15 billion).
• Ultra High Net Worth Individuals are people with a net worth of at least 30 million USD (equivalent to Rp. 450 billion).

Based on The Wealth Report 2022 published by Knight Frank as of March 1, 2022:

• The number of High Net Worth Individuals is 134,015 people. Equivalent to 0.049% of Indonesia's population in 2022.
• The number of Ultra High Net Worth Individuals is 1,810 people in 2022. Equivalent to 0.0007% of Indonesia's population.

The trend of the number of rich people in Indonesia in the last 3 years, based on research conducted by Knight Frank:

3 Parts of Wealth Management

Wealth management consists of three major components, which are:

Wealth Protection and Preservation

Wealth protection and preservation focuses on securing and preserving wealth. The goal is to keep wealth from being reduced, minimize losses, and ensure assets are well maintained

This is accomplished through risk management, insurance, tax planning, protecting loans and others.

Wealth Growth and Accumulation

Wealth growth and accumulation focuses on growing and accumulating wealth. The goal is to increase wealth and grow 1 to 2, to 3 times and continue to accumulate.

This is accomplished by investing in both real assets and paper assets. Real assets are property, business and franchises, while paper assets are mutual funds, stocks, bonds and others.

Wealth Distribution and Transition

Wealth distribution and transition focuses on the distribution and transfer of wealth from one generation to the next. The goal is so that wealth can be preserved to the seventh generation and beyond. This is accomplished by planning inheritance, business succession and so on.

Wealth Advisor

Wealth management is usually assisted by a professional Wealth Advisor. Wealth Advisory services in Indonesia are usually provided by priority banking and investment advisory (PI) firms.

In general, there are two types of wealth advisory business models:

• Wealth advisors charge advisory fees to their clients. For example, a fee per consultation or a percentage of the assets under advisory (AUA) is charged.
• Wealth advisors earn commissions from the sale financial products such as insurance products, mutual funds, bonds or stocks.

A wealth advisor usually has one or several licenses, such as WMI (Investment Manager Representative), WPPE (Securities Broker-dealer Representative), WAPERD (Mutual Fund Securities Selling Agent Representative).

In addition to licenses, several wealth advisors have credentials or certifications in finance, such as: CFP® (Certified Financial Planner), CFA® (Chartered Financial Analyst), CWM® (Certified Wealth Manager) and other certifications.

A Wealth Advisor in an investment advisory company is prohibited from:

1. Disclosing customer identity or credentials to third parties unless required by applicable laws and regulations.
2. Misleading a customer regarding the qualifications of an Investment Advisor or misrepresenting the nature of the services provided.
3. Promising a certain result or a certain return.
4. Managing customer funds.
5. Manipulating contracts.

Complete information on regulations regarding the prohibition of investment advisors can be found in the Decree of the Chairman of the Capital Market Supervisory Agency, Number KEP-33/PM/1996 concerning Prohibited Behavior for Investment Advisors.

Wealth Management Process

The wealth management process is comprised of 6 steps, which are:

1. Set investment goals together with the client. For example, a client wants to grow his assets from Rp. 15 billion to Rp. 30 billion in the next 5 years.
2. Collect related information. For example, how much can be invested each year, and information about assets that are already owned and so on.
3. Analyzing information and data.
4. Develop a strategy for wealth management. For example, an investment allocation strategy, an asset protection strategy and/or a tax management strategy.
5. Assisting with the implementation of the wealth management strategy.
6. Review the implementation.

How to Become A Wealth Management Client PT Moduit Digital Indonesia is an investment advisory company under OJK (Decree: KEP-30/D.04/2019).

Moduit Beyond is a Wealth Management service handled by experienced wealth advisors.

To become a Moduit Beyond client, investors can complete registration documents. Initial investments start at IDR 1 billion. Benefits of becoming a Moduit Beyond client include:

• Personal advisor
• Curated financial products
• Priority access for newly launched products & services
• Daily reports on the market
• Priority call center
• Exclusive lounge access
• Year-end gifts

You can become a Moduit Beyond client by contacting us on this form or contacting a Moduit Beyond wealth advisor.

Reference sources:

• Dock David Treece. 9 July 2022. What Is Wealth Management? Do You Need It?. Forbes.com
• Roger Wohlner. 15 September 2022. What is wealth management and do you need it?. Bankrate.com
• Hilda B Alexander. 10 March 2022. Dalam Lima Tahun, Jumlah Orang Kaya Indonesia Melonjak 63 Persen. Kompas.com