Are you a wealth advisor trying to enter or broaden your attain within the high-net-worth (HNW) market? This consumer section consists of enterprise house owners, executives, artistic professionals, and next-gen heirs with a internet value of $5 million or extra.
These potential shoppers signify 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 will you get or fine-tune these expertise? Incomes the Licensed Personal Wealth Advisor® (CPWA®) certification from the Investments & Wealth Institute (IWI) is one option to accomplish this purpose. However is it well worth the time, effort, and cash you’ll dedicate to the method?
That will help you make your determination, let’s evaluate what getting a CPWA certification entails and the way it may benefit wealth advisors who want to serve HNW shoppers.
What Is a CPWA Certification?
The CPWA certification program entails a singular, 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 prime enterprise faculty
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A 12-month online-only program
The stipulations are:
Lastly, you have to cross a four-hour closing examination overlaying 135 questions.
What Are the High Causes to Take into account 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 information particular to fixing complicated planning challenges
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Potential for greater compensation and profession development
And, latest information tells us {that a} CPWA certification could also be an efficient option to develop your follow. In keeping with Cerulli Associates, CPWA practices have the biggest common consumer dimension within the trade:
What Will You Study?
The CPWA program’s curriculum is designed to provide the idea and sensible strategies you’ll have to serve HNW shoppers—and to cross the required certification examination. The 11 core subjects are damaged down into the next 4 classes:
1. Wealth administration. Understanding the large image is important to optimizing planning for the ultrawealthy. This section will assist you analyze and suggest tax-efficient options and discover ways 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 assist you work successfully with shoppers’ tax attorneys.
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Portfolio administration. This section will elevate your talents to harmonize wealth-building strategies, danger administration, tax consciousness, and portfolio methods with shoppers’ sources and targets.
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Threat administration and asset safety. You’ll study to judge acceptable insurance coverage and asset methods to guard shoppers via life occasions together with marriage, divorce, and dying.
The [CPWA program] content material was unbelievable 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 consumer section requires sturdy expertise in managing expectations, decision-making, and relationships, however you’ll want to lift 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 permit you to work confidently with a classy consumer base.
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Behavioral finance. Cognitive and emotional biases can intrude with a consumer’s capability to make sound selections. By studying methods 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 rely upon your understanding of key household roles, household workplace infrastructures, and the nuances of performing consumer 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 section provides you with the superior expertise you want.
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Charitable giving and endowments. You’ll study 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 consumer situations.
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Property trusts and wealth switch. Though components of property planning could lie outdoors your obligations, 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 consumer companies. There are particular challenges concerned with enterprise planning along with HNW shoppers’ broader planning and portfolio administration wants.
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Government compensation. This section addresses methods 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 big inhabitants of the $5 million-plus consumer base, intently 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 via the distribution part, you’ll want to grasp return sequencing, analytical forecasting, tax remedies, Roth conversions, distribution necessities, and analysis of certified plans and internet unrealized appreciation (NUA) guidelines.
So, Is the CPWA Certification a Worthwhile Funding?
If what you are promoting purpose is to draw and retain HNW shoppers, the information and insights supplied by a CPWA certification could assist you goal—and higher serve—this nook of the advisory market. However, be certain you will have a transparent plan earlier than diving in. Making lasting connections along with your desired clientele all the time relies on your agency’s service choices and the consumer 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 applications.