Creative Planning acquires small wealth unit from Goldman Sachs

Goldman Sachs has made an announcement on Monday regarding the sale of its personal financial management unit to Creative Planning, a competitor in the industry. The transaction is set to close within the fourth quarter of this year, providing a gain for Goldman Sachs. The specific sale price for the personal financial management business was not disclosed by the bank.

In May 2019, Goldman Sachs acquired a group of 220 financial advisors who manage $25 billion in assets as part of their $750 million acquisition of United Capital Financial Partners. This move was seen as a means to expand their reach beyond their ultra-rich clientele and cater to those who are wealthy but not in the same league as the ultra-rich.

However, as part of CEO David Solomon’s efforts to divest from certain businesses related to their retail banking plan, the personal financial management division was considered too small in comparison to Goldman Sachs’ larger ambitions in wealth and asset management. In February, it was revealed that Goldman Sachs only held about 1% of the high-net worth market, which consists of individuals with assets between $1 million and $10 million.

According to Marc Nachmann, the global head of asset and wealth management at Goldman Sachs, the sale aligns with the goals and targets set during their investor day in February. He also mentioned that this decision allows them to focus on their ultra-high net worth wealth management and workplace growth strategy, while still supporting high net worth clients through a strategic partnership with Creative Planning.

Creative Planning, based in Kansas, is a registered investment advisor with a workforce of over 2,100 employees and manages over $245 billion in assets.