5 Private Banking Questions You Should Be Asking

If you've got a lot of funds you're ready to invest, the private banking system is certainly something to look hard at. These are much more personalized than the services provided by retail banks, which focus more on the basic services relevant to people who have lower net worth. That means you'll want to ask some important questions so you'll know you've found the right bank.

1. Will I have a dedicated account manager?

One of the major advantages to opting for personalized banking services is that the investment managers can get to know your specific money management goals. However, some banks with private accounts still have multiple account managers who share the workload. While this can be good if your personal manager isn't available, it can be confusing having more than one person involved in your money management.

2. What is the minimum deposit amount?

Banks vary in how much they require individuals to have available for investment banking to open a private account. In many cases, it is upwards of $250,000. The reason for the minimum deposit is that many of the investment banking strategies require that the individual have a large sum available.

3. How is your bank better than the competitors?

Many banks offer private services, and you want to hear their pitches of what their advantages are in the field. When you're investing so much money, it makes sense to ask this question of several banks and learn what sets them apart from one another.

4. What is your fee structure?

Some banks charge a percentage of the total investment for their services, whereas others have a flat fee per transaction. Some banks won't charge anything, but instead get their money based on commissions for the investments they direct your money into. This can actually cost an investor more because the account manager could be tempted to handle the account based on his commission instead of what the best choices are for the investor.

5. What estate planning services do you offer? In addition to managing your money during your life, you also want to choose a bank that can help you with estate planning. The tax implications of leaving money to your heirs are significant, and bankers should be able to help you strategize the best way to organize your estate.

The key to finding a private banking institution is to find one that you'll be able to trust your future with since building your financial future properly is definitely important. These questions can help you narrow down your options and make a wise financial choice.

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