Are you a wealth advisor seeking to enter or increase your attain within the high-net-worth (HNW) market? This shopper phase contains enterprise house owners, executives, artistic professionals, and next-gen heirs with a web price of $5 million or extra.
These potential shoppers symbolize a various group with distinctive challenges and life targets far past asset accumulation. To draw and retain HNW shoppers, you’ll want superior technical experience and nuanced expertise in folks and household dynamics administration.
How are you going to get or fine-tune these expertise? Incomes the Licensed Non-public Wealth Advisor® (CPWA®) certification from the Investments & Wealth Institute (IWI) is one method to accomplish this aim. However is it definitely worth the time, effort, and cash you’ll dedicate to the method?
That will help you make your choice, let’s evaluate what getting a CPWA certification includes and the way it may benefit wealth advisors who want to serve HNW shoppers.
What Is a CPWA Certification?
The CPWA certification program includes a novel, multidisciplinary strategy to addressing the monetary wants of HNW shoppers. Candidates to this system can select between two enrollment choices:
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A 6-month on-line program together with a 1-week, in-person class at a high enterprise faculty
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A 12-month online-only program
The conditions are:
Lastly, you will need to move a four-hour remaining examination protecting 135 questions.
What Are the Prime Causes to Think about the CPWA?
The first advantages cited by many advisors holding this certification are:
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Aggressive differentiation within the crowded HNW market
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Extra confidence in working with ultrawealthy shoppers
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Superior data particular to fixing complicated planning challenges
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Potential for greater compensation and profession development
And, latest knowledge tells us {that a} CPWA certification could also be an efficient method to develop your follow. In accordance with Cerulli Associates, CPWA practices have the biggest common shopper measurement within the trade:
What Will You Study?
The CPWA program’s curriculum is designed to provide the principle and sensible methods you’ll have to serve HNW shoppers—and to move the required certification examination. The 11 core matters are damaged down into the next 4 classes:
1. Wealth administration. Understanding the large image is important to optimizing planning for the ultrawealthy. This phase will allow you to analyze and advocate tax-efficient options and learn to construct and handle portfolios that meet complicated HNW targets.
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Tax planning. This deep dive into HNW-specific taxation will information you in speaking about methods with shoppers, simplify planning, and allow you to work successfully with shoppers’ tax attorneys.
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Portfolio administration. This phase will elevate your skills to harmonize wealth-building methods, threat administration, tax consciousness, and portfolio methods with shoppers’ sources and targets.
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Threat administration and asset safety. You’ll be taught to judge acceptable insurance coverage and asset methods to guard shoppers by way of life occasions together with marriage, divorce, and demise.
The [CPWA program] content material was improbable and considerably elevated my capability so as to add worth to my goal market ($1 million–$5 million investable, primarily company VP-level folks).”
Justin Hutt, CooperDavis Monetary Group,with Commonwealth since 2017
2. Human dynamics. Working with any shopper phase requires robust expertise in managing expectations, decision-making, and relationships, however you’ll want to boost your sport when serving the extremely prosperous.
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Ethics. Studying to determine and classify moral and regulatory points throughout the wealth administration spectrum will can help you work confidently with a classy shopper base.
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Behavioral finance. Cognitive and emotional biases can intervene with a shopper’s capability to make sound selections. By studying tips on how to determine biases, you’ll be higher geared up to appropriate or complement these tendencies.
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Household dynamics. Tailoring methods for household organizations, trusts, and enterprise entities will depend on your understanding of key household roles, household workplace infrastructures, and the nuances of performing shopper discovery.
3. Legacy points. If you happen to haven’t mastered the complexities of how charitable and property planning options assist shoppers switch wealth, this phase will provide you with the superior expertise you want.
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Charitable giving and endowments. You’ll be taught to evaluate the benefits and downsides of private and non-private charities, foundations, and trusts, in addition to the tax implications of giving methods in complicated shopper situations.
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Property trusts and wealth switch. Though components of property planning might lie exterior your duties, a full understanding of wealth switch, end-of-life planning, and fiduciary points is important to the work of an HNW wealth advisor.
4. Specialty shopper companies. There are particular challenges concerned with enterprise planning at the side of HNW shoppers’ broader planning and portfolio administration wants.
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Govt compensation. This phase addresses tips on how to consider inventory choices, deferred and fairness compensation plans, and concentrated inventory conditions, together with guidelines, restrictions, and tax implications.
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Intently held companies. As a major inhabitants of the $5 million-plus shopper base, carefully held enterprise house owners want advisors who could make acceptable suggestions about enterprise entity buildings and their tax implications, buy-sell agreements, valuation strategies, the enterprise lifecycle, and succession planning.
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Retirement. To information shoppers with huge belongings by way of the distribution section, you’ll want to know return sequencing, analytical forecasting, tax remedies, Roth conversions, distribution necessities, and analysis of certified plans and web unrealized appreciation (NUA) guidelines.
So, Is the CPWA Certification a Worthwhile Funding?
If your online business aim is to draw and retain HNW shoppers, the data and insights provided by a CPWA certification might allow you to goal—and higher serve—this nook of the advisory market. However, ensure you’ve a transparent plan earlier than diving in. Making lasting connections along with your desired clientele at all times depends upon your agency’s service choices and the shopper expertise you ship.
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Commonwealth and IWI are separate and unaffiliated entities. Please seek the advice of your member agency’s insurance policies and acquire prior approval for any designation/certification packages.
