Private banks
Private banks are reserved exclusively for the wealthy who have assets of at least $1 million.
However, the minimum amount of cash required to open an account varies from bank to bank.
Most private banks require their customers to be high net worth individuals, which the Securities and Exchange Commission defines as those who hold at least $750,000 in investable assets.
Invested assets include assets that are liquid or nearly liquid.
But even if you have the money to open an account, a private bank account may not be right for you.
These banks are very exclusive when it comes to which organizations they allow to work with them.
Financial products and services provided by private banks are subject to fees, and account maintenance fees must also be considered.
These fees, however, can be avoided by keeping a certain minimum account balance that goes from bank to bank.
Here are the services offered by private banks:
- Preferential rates: Deposit accounts at private banks have higher APYs. Compared to other types of banks, fees charged by private banks can be lower. In addition, private bankers can take advantage of preferential rates on loans and mortgages.
- Comprehensive Financial Planning. Private banks often accompany their clients in making financial decisions. This financial advice includes creating savings plans, analyzing the financial implications of major purchases, and so on.
- Investment Advice: Private banks will also give their clients investment advice, just as investment banks do. Private banks advise their clients on issues such as selling and buying securities, stocks and bonds, and asset allocation.
- Wealth Management: A wide range of wealth management services are included in private bank services. Everything from legal advice, estate planning, personal accounting, retirement planning and tax advice is available to private bankers.
- Credit Services: Private bank customers can open lines of credit with their bank and receive lower rates than other types of banks.
- Lending. Private banks also make loans to their customers to facilitate the purchase of basic luxuries or things like land, real estate, etc.
- Private Banking is a very lucrative and unique banking solution.
Opening a private bank account gives you access to a multitude of financial instruments, products and services.
Private banks are essentially personal accountants and financial advisors who hold your money.
The catch is that you need to have enough cash to open an account and keep up with account minimums.
If you are a wealthy person with a high income, private banks are perfect for you because of the long list of benefits they provide.