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In the past few decades, Singapore has progressed from a low-income to a high-income country. The ‘Lion City’ is a fast-growing economy among the top financial centers globally. Unsurprisingly, the government is experiencing a rise in the number of affluent and high-net-worth individuals with a keen interest in wealth management. Let’s learn more about this topic and the evident trends.

An Overview of Wealth Management

Wealth management is a comprehensive service for highly affluent clients that covers several financial needs:

  • Investment management and advice
  • Comprehensive financial planning
  • Tax planning and accounting services
  • Estate planning
  • Legal services
  • Retirement planning

Wealth management is usually offered by specialized wealth management firms that charge an annual or monthly fee based on a client’s assets under management (AUM). This refers to the total value of all financial assets the client owns. Other pricing structures may include a flat fee and an hourly fee.

Ultimately, wealth management seeks to maintain and grow one’s wealth. Of course, clients will interpret this statement in different ways. Some may lean more towards keeping their wealth, while others focus on increasing it. Wealth managers tailor strategies based on one’s objectives while considering one’s financial situation.

According to research by Statista, Singapore’s wealth management market is projected to be worth about $200 billion this year.

Traditionally Used Wealth Management Avenues in SG

The traditional method of accessing wealth management in Singapore is through a dedicated firm or a financial institution (like a bank or investment company) with a separate wealth management service.

The first advantage of this type of wealth management is face-to-face, personalized interaction. Moreover, human-based wealth management comes with expertise, where advisors can offer specific strategies based on their clients’ needs.

Emerging Wealth Management Trends in SG

Digital Platforms

Wealth management gradually moves from physical interactions to a hybrid model that merges a technology platform with human-driven advice.

Meanwhile, some platforms are becoming more automated, offering advanced, ‘ready-made’ portfolios where clients simply need to perform a few clicks. The best example is robo-advisors, algorithm-driven platforms incorporating financial planning with little human involvement.

This is much more convenient, giving wealthy individuals greater control in the decision-making. Furthermore, such digitization also serves those below the mass affluent bracket.

Fixed-Income Investing

Wealth managers have emphasized fixed-income investments instead of risky markets like forex trading in Singapore. Bonds are often the go-to fixed-income asset, offering periodic interest payments and less volatility than other assets.

Within Singapore, digital investment platforms like Syfe have caught the wave and recently launched two high-yield bond products in partnership with investment management company Pimco.

Generative AI

Generative artificial intelligence uses prompt-based generative models to produce conversations, images, videos, music, and more. It offers the industry several benefits, like efficient lead generation, better personalisation — more tailed offerings, enhanced productivity, and improved decision-making through more profound insight into customer and market data.

Ethical Investing

Besides wealth preservation and increase, wealthy Singaporeans have also considered ethical or socially responsible investing, a globally sustained trend. Ethical investing is an effective catalyst for change, following the awareness of the many immoral practices across industries. It also offers the potential for greater innovation with numerous sustainable technologies.

Continued Demand for Wealth Management in Singapore

Singapore is a daily reminder that dynamite comes in small packages. The nation’s prospering economy has led to more citizens requiring wealth management. This multi-billion-dollar industry is witnessing emerging trends like digitisation, greater focus on fixed income, generative AI, and ethical investing, making it more appealing.