Investing · December 17, 2020

A Portfolio Manager Can Help You Achieve Your Goals

Financial goals help you steer yourself toward the future you want. There are many factors that go into achieving those goals, but two stand out as among the most important.

The first is disciplined saving. Success in this area is all about establishing positive habits and sticking to them. Save what you can on a regular basis, and you'll be better positioned to afford the things you want and need down the road. The second key factor is an effective investment strategy. This comes down to making the right investments at the right times—and most people need a hand in achieving that.

A portfolio manager can help you chart a sound strategic approach based on expert knowledge and experience. As a professional investor, they help keep your financial targets on track by overseeing the investment and growth of your hard-earned savings over time.

In-depth market knowledge

Portfolio managers operate in the asset management realm of the financial services world. On a day-to-day basis, they work with investment accounts opened by individuals as well as the investments of pension funds, foundations and families with large estates.

As a result, portfolio managers have a deep understanding of what investment options are available—stocks, bonds, mutual funds, exchange-traded funds and other assets—and what kind of risk-reward tradeoff each type offers.

Generally, a portfolio manager only collects a fee on the amount of money they oversee, so there's an incentive for them to perform well. Plus, because they don't sell other financial products, there's no potential conflict around any sales commissions.

How advisors and portfolio managers work together

Occasionally, a portfolio manager will be called a financial advisor, and vice versa. The confusion is natural, as both are working to help their clients financially, but an advisor tends to be somewhat removed from investment decisions. They'll focus on the entirety of your situation, from your current income and expenses to your near-, medium- and long-term dreams. Along with such broader life goals, an advisor will dig deeper into your attitudes about spending and debt to determine your everyday approach to finances.

An advisor will often develop a wide-ranging holistic financial plan for you. They'll typically ask questions like:

  • What are your big-picture financial goals?
  • What's your level of comfort with risk?
  • When do you plan to retire?
  • Are you investing for large future expenses, like a child's higher education? If so, how much time do you have until you need to pay for this?

From there, they may hand off the investment piece to a portfolio manager. Much of a portfolio manager's work focuses on creating and maintaining a collection of investments tailored to your goals, time frame and risk tolerance, regularly asking questions such as:

  • What's the right investment mix for this point in your life?
  • What specific investments are the best fit for you?
  • What types of adjustments are needed? And how often?
  • How can the account ease your tax burden?
  • What accounts are best for different types of investments?

Historically, portfolio managers generate the types of returns that are helpful in achieving goals of any scope. For example, if you're looking to save $20,000 over the next few years for a down payment on a house, putting $500 a month into a professionally managed portfolio can likely get you there quicker than a low-rate savings account.

At the same time, if retirement is more than 20 years off, a portfolio manager can help plot out an ideal long-term investment approach that blends a spectrum of potential rewards with different levels of risk.

A valuable investment ally

If you're like most people, you're intrigued by the world of investments, but you might not have the time to learn how to make effective moves with your money. A portfolio manager can help bridge that gap while keeping you on the path to achieving your life goals.


A few financial insights for your life

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This information is provided for educational purposes only and should not be relied on or interpreted as accounting, financial planning, investment, legal or tax advice. First Citizens Bank (or its affiliates) neither endorses nor guarantees this information, and encourages you to consult a professional for advice applicable to your specific situation.