Why do big clients walk away, and what can advisors and their firms do to hold on to important high-net-worth clientele? The difference between keeping a big client and watching one walk out the door hinges upon advisor experience and expertise – but technology is playing an increasingly valuable role in client retention as well.
While professional education is an important element in overall client satisfaction, real-world knowledge that’s gained on the job is also critical. Meaningful professional experience, however, can take years to acquire in the workplace and sometimes comes at the cost of learning from mistakes – something no advisor wants to do with an important client.
Fortunately, advances in learning technology have made it possible to digitally simulate a wide array of client scenarios.
Simulations: Changing The Way Advisors Learn
According to The Regis Company, a learning and development design firm, a business simulation is “an imitation of real-world business challenges that provoke participants to reflect on their thinking and behavior.” Simulations model major business events and challenges, and “teach participants in hours what would take months or years to experience on the job.”
“Participants feel the intellectual, social and emotional challenges often engendered through painful (and costly) mistakes in the real world.”
For financial services professionals, the opportunity to learn key wealth and investment tactics and strategies in a simulated environment allows a level of freedom unattainable when engaging a real-life client account. In a simulation, the advisor is free to take risks and explore the consequences and outcomes of his or her actions. Learning simulations provide the freedom to fail but, more importantly, they create opportunities to learn from mistakes. Having the freedom to make real-world portfolio decisions without real-world repercussions is a liberating way to learn and develop essential investment management skills.
Keep Your Big Clients – And Attract New Ones
Today’s high-net-worth clients expect a lot from advisors. Simply selecting investments for the portfolio is not nearly enough anymore; the task can now be done hyper-efficiently through sophisticated robo-advising algorithms. We are in a new era of advising, and financial services professionals must pivot in order to stay relevant and to continue to provide the value clients are looking for.
Success in modern wealth management requires advisors to shift their outlook. Old paradigms are changing. It won’t be a matter of simply providing clients with technical knowledge; instead, success will depend on an advisor’s ability to understand clients on an individual basis and provide solutions based on a point of view tailored to their unique needs.
Learning Simulations With Wealth Management Certified Professional® |WMCP®
The latest designation from The American College of Financial Services, the Wealth Management Certified Professional® (WMCP®), takes a deep dive into goal-based wealth and investment management. WMCP® focuses on areas of personal investment management where advisors can add the greatest value, especially for mass-affluent and high-net-worth clients.The College partnered with The Regis Company to create a series of advanced simulations that are central to the learning experience of this designation program. These simulations will guide students through an array of wealth and investment management scenarios.
WMCP® simulations, however, are not linear experiences. Rather, advisors are free to test different scenarios and explore outcomes as they relate to client portfolios, risk tolerance, asset allocation, tax efficiency, and more. The simulations are paired with instructional videos and interactive tools, creating a seamless digital learning experience.
In one WMCP® simulation, students will gain an understanding of risks and goals by experimenting with portfolio risk and return allocations to achieve a fictional client's investment goals over a simulated lifetime. Learners make decisions at intervals over the client’s lifecycle to help them prepare for retirement. This simulation illustrates the trade-offs between flexibility in current spending and uncertainty in retirement outcomes, as well as the risk and return trade-offs of investments.
The simulations attempt to mimic real-life scenarios. A client may lose her job, or her spouse might die, or she may gain an unexpected cash windfall – the WMCP® simulations are designed to create learning opportunities out of the circumstances in which clients find themselves at various stages of life. The simulations encourage students to wrestle with significant ideas and apply theory and knowledge in an practical way.
In his role as associate professor of behavioral finance at The American College of Financial Services, Dr. Benjamin Cummings played a principal role in the development of the WMCP® program content.
Cummings said the simulations function primarily as learning tools, but at times they mirror real-life client interactions.
In a more traditional financial planning case study, the student is only given one point in time within the case. In the WMCP® simulations, students can visit the same client at multiple points in time, Cummings said, noting that this type of interaction is more true to what an advisor needs to do on the job than the single point of view in a standard case study.
“Students are allowed to make decisions, to succeed, to fail, and to experiment,” Cummings said. “As learners engage with a simulation, they’ll be given feedback over time, being asked to think about why they made certain decisions, and why certain resources were utilized or ignored throughout the decision-making process.”
Increase Your Competitive Advantage With WMCP®
From building tax-efficient portfolios and maximizing the use of complex wealth strategies to better understanding client motivations and goals, WMCP® delivers both advanced knowledge and practical tools designed to maximize an advisor’s value and enhance competitive advantage. Simply put, WMCP® will make you a more in-demand advisor.
WMCP® features a state-of-the-art online system that customizes the student learning journey. The coursework includes a series of advanced simulations that cover portfolio goal setting and risk taking, portfolio allocation, asset allocation and asset location decisions, product evaluation, advanced planning strategies, and more.
The WMCP® program is like nothing the financial services profession has ever seen before; it is a new benchmark in the quality of professional education and student experience, and it can only be found at The American College of Financial Services.
A well-respected financial advisor once shared his advice to clients who dreamed of buying a motorhome and traveling across America as soon as they retired.
“I’d tell them ‘Sure! that’s a great...