Citi Personal Wealth Management Review - MagnifyMoney
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Citi Personal Wealth Management Review

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Citi Personal Wealth Management is part of the larger Citigroup brand, which is well-known for its consumer banking operations. This wealth management division offers clients investment products and advisory services, including portfolio management and financial planning, through the Citigroup Global Markets Inc. (CGMI) unit. There are several portfolio strategy options available, and minimum investment requirements vary by program.

The bottom line: Citi Personal Wealth Management, a division within Citigroup, offers portfolio management and financial planning for individual and institutional clients.

  • Large variety of portfolio choices
  • Fee schedules vary by program
  • Robo-advisor option offered

All information included in this profile is accurate as of September 24, 2021. For more information, please consult Citi Personal Wealth Management’s website.

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Overview of Citi Personal Wealth Management

Citi Personal Wealth Management is the wealth management arm of the Citi brand, which is known as one of the nation’s “big four” largest banks. Citigroup was created in 1998 when Citicorp and Travelers Group merged. Yet the company’s roots date back to 1812, when the City Bank of New York was established.

Owned by the financial services colossus Citigroup Inc., a publicly traded company, the wealth management division is responsible for providing financial advisory and investment services to Citi’s many banking clients. In 2021, Citigroup reorganized this arm by combining its private bank for ultra-wealthy clients and its consumer wealth management services into one unit called Citi Global Wealth.

The unit currently has over 8,100 employees, approximately 3,400 of whom perform financial advisory and research services.

Citi Personal Wealth Management’s pros

  • Relatively low minimum investment: Many of the firm’s advisory services require a relatively low minimum of $25,000, which puts Citi’s services in reach for many levels of investors. That being said, minimum requirements can range much higher for some programs, reaching as high as $25 million.
  • Wide range of investment choices and plans: Citi Personal Wealth Management offers a wide array of investing options, with a long list of programs to choose from. Clients can opt for an account that uses just one investing strategy or numerous strategies, and they also have the choice of working with the firm directly or with a third-party manager.
  • Large national network: The team provides wealth and investment advisory services from close to 700 offices around the country. Advisors have access to internal research by the company’s analysts, economists and other industry specialists.
  • Awards and accolades: The team has earned high rankings on reputable lists of the best advisors. For example, in 2021, Citi was the Private Asset Manager (PAM) winner for total wealth solutions provider for ultra high net worth clients. The firm was also designated the Family Wealth Report winner for best alternative asset manager.

Citi Personal Wealth Management’s cons

  • Potential conflicts of interest related to proprietary research: Advisors recommend products based on fundamental research from CGMI. Because CGMI does business with companies that are covered by its research, this may present a conflict of interest that affects the objectivity of these research reports and may result in biased portfolio recommendations.
  • Potential conflict of interest with fund fees: There are no performance-based fees associated with the firm’s advisory programs. However, some funds in which clients may be invested charge management and performance fees. CGMI shares in the fees charged by some of these funds, and negotiates these fees with the portfolio managers and funds. These fees may be paid out of fees that are received by CGMI. Because of the variation in rates negotiated by CGMI with the portfolio managers and funds, this may cause a conflict of interest when it comes to selecting these managers and funds.
  • Disciplinary disclosures: The larger CGMI, of which Citi Personal Wealth Management is a part, has a long list of disclosures, which is common for large financial firms. See more on these disciplinary disclosures below.

What types of clients does Citi Personal Wealth Management serve?

The majority of the firm’s clients are individuals in the non-high net worth category, although there are thousands of clients with a high net worth as well. (For reference, the SEC defines high net worth individuals as those with at least $750,000 under management or a net worth of at least $1.5 million.) Clients must enter into an agreement with Citi Private Bank (CPB), CGMI or Citibank in order to participate in the programs offered by the firm.

Relationships with a financial advisor through Citi typically require an investment of at least $25,000, though minimums can range much higher than that, up to $25 million. The minimum amount required for the division’s low-cost robo-advisor program is $1,500.

Services offered by Citi Personal Wealth Management

Citi Personal Wealth Management provides clients with ongoing portfolio management as well as a la carte financial planning services.

Portfolio management: For portfolio management, clients have numerous programs from which to choose. They can tap Citi financial advisors to directly manage their portfolios, or opt for the advisors to recommend specific professional managers, including unrelated parties, to oversee their account. Clients can have their portfolios managed either through a discretionary relationship, in which advisors are in charge of all trades, or a non-discretionary arrangement, in which clients are responsible for making trades but still receive recommendations from advisors.

Financial planning: Individuals and families can also tap the team for a written financial plan to help achieve specific financial goals. Topics addressed can include insurance needs, estate planning, education planning, retirement, taxes and expenditures. The plan is intended to be a one-time list of recommendations; it will not be continuously updated.

Additional services and products: Outside of the registered investment advisory services, the wealth management group also serves as a broker-dealer. Thus, advisors can place individual trades in client brokerage accounts and earn commissions per trade. Advisors can also sell insurance products, such as annuities.

Here is a list of services offered through Citi Personal Wealth Management:

  • Investment advisory services/portfolio management
  • Financial planning
    • Retirement planning
    • Estate planning
    • Education planning
    • Tax planning and management
    • Insurance management
  • Pension consulting services
  • Selection of other advisors
  • Security ratings or pricing services
  • Asset allocation advice
  • Publication of periodicals or newsletters
  • Brokerage services

How Citi Personal Wealth Management invests your money

To guide their decision-making process, Citi financial advisors and portfolio managers have access to the bank’s internal research, including insight from their economists and industry specialists.

In general, to decide which investment managers and products to offer clients, the team relies on a combination of qualitative and quantitative analysis, evaluating factors such as a company’s management team, investment process, staffing and operational issues. Performance metrics including absolute return, volatility and risk-adjusted return may be analyzed and charted.

How client money is invested ultimately will depend on the type of account the client chooses as well as the financial advisor. An advisor can create a custom portfolio for each client, based on the client’s goals, risk tolerance and time horizon. Alternatively, clients can choose from a list of recommended portfolio managers and asset allocation models. Separately managed accounts are also available, as well as investments in alternative funds, such as hedge funds.

Overall, portfolios created by the firm may be invested in:

Fees Citi Personal Wealth Management charges for its services

For portfolio management, clients typically pay an annual fee calculated as a percentage of their assets under management. Rates vary based on the program selected. The fee to Citi generally ranges from 0.60% to 2.00% of assets under management, depending on the type and size of the account, and the rate is often negotiable. Fees are typically paid quarterly in advance.

Clients who hire an additional layer of portfolio managers will pay an extra fee for those services, ranging from 0.10% to 0.35% for fixed-income strategies and 0.25% to 0.50% for other strategies. Investment managers may also charge a performance-based fee. Keep in mind that clients will also pay internal mutual fund and ETF fees, as well as trading costs when another firm is used.

Financial planning is generally offered at no additional cost. The online advisory program is also included at no cost for certain clients, or at a rate of 0.55% to new clients.

Citi Personal Wealth Management disciplinary disclosures

CGMI, of which the Citi Personal Wealth Management is a part, discloses hundreds of pages of allegations against it and its predecessor firms from regulators including the SEC, FINRA, certain states and others. In many instances, the firm settled cases without admitting or denying guilt. For reference, the SEC requires all registered investment advisors to disclose on their Form ADV whenever the firm, an employee or an affiliate faces any disciplinary or legal actions that are material to a client’s evaluation of the advisory business or the integrity of the management team.

The company’s long list of disclosures includes issues such as:

  • In 2017, CGMI entered into an agreement with FINRA, which alleged that the firm displayed inaccurate ratings for some equity securities. Without admitting to wrongdoing, CGMI agreed to a censure, a fine of $5.5 million and compensation of at least $6 million to customers who were solicited to purchase or sell securities that were affected by the ratings issue.
  • In 2017, CGMI agreed to a settlement stemming from allegations that it had overcharged 60,000 advisory clients by the amount of $18 million, relating primarily to the TRAK fund solutions program.
  • In 2012, without admitting or denying the findings, the group settled in response to allegations that from 2008 to 2009 certain registered representatives made unsuitable recommendations of non-traditional ETFs to customers looking for conservative investments.

For more information on the firm, you can go to its IAPD page.

Citi Personal Wealth Management onboarding process

  1. Contact an advisor near you: To reach out to one of the firm’s financial advisors, potential clients can call 1-877-357-3399. You can find out what services are available in your area through the firm’s website.
  2. Sign a program agreement: Before any relationship formally begins, clients must sign a program agreement with either Citibank or CGMI that spells out their services and fees.
  3. Receive periodic reviews: Once established as a client, expect to hear from Citi through periodic performance reviews. Accounts are monitored on an ongoing basis.

Where Citi Personal Wealth Management is located

On its Form ADV, Citi Personal Wealth Management lists the following as locations for its offices:

  • California
  • Connecticut
  • District of Columbia
  • Florida
  • Illinois
  • Missouri
  • New York
  • Texas

However, this does not appear to be the full list, as the firm notes in its Form ADV that it has over 660 offices. Additionally, the firm is registered to do business in all 50 states, plus the District of Columbia, Puerto Rico, the Virgin Islands and Guam.

To find out if there is an advisor near you, you can use the advisor locator tool on Citi’s website or call the firm at 1-877-357-3399.

Is Citi Personal Wealth Management right for you?

Citi Personal Wealth Management aims to offer Citi clients investment products and wealth management services alongside the brand’s traditional banking and product offerings. Current Citi clients can look at their advisory program offerings since they may qualify for some services, such as financial planning, at no cost, or get discounts on other services. In addition, clients looking to establish a relationship with a large bank offering a laundry list of investment options can consider Citi.

Clients will need to speak to each specific advisor to determine their services and fees, since they vary by advisor. And remember, fees are negotiable. You’ll also want to keep in mind the fact that Citi Personal Wealth Management does earn commissions for certain products and services, and that not all advisors can offer every service. Before you make your decision, be sure to research multiple firms to ensure you find the right advisor for you.

The “Find a Financial Advisor” links contained in this article will direct you to webpages devoted to MagnifyMoney Advisor (“MMA”). After completing a brief questionnaire, you will be matched with certain financial advisers who participate in MMA’s referral program, which may or may not include the investment advisers discussed.