Behavioral finance can also help planners determine their own set of values, which can in turn, help them help others in terms to providing solutions that not only work for clients, but are empathetic and meaningful. This is increasingly important as we can see in, among other things, advertising campaigns that showcase the emotional reasons for why people are eager to save, be it for retirement, traveling or saving for a child’s education. Giving people a tangible “why” for something they’re doing makes it more real to them in a way that numbers alone can’t.
Our Behavioral Finance and You course at Kaplan developed with our partners at think2perform takes advisors down a path of understanding their values and motivations. From there, advisors can take that information and apply it to real-life scenarios. This approach provides advisors with an approach that’s non-threatening to customers and gets them into the mindset that the two are working together to craft solutions that make the most sense.
Helping explain different financial instruments and how they work through behavioral finance can not only help advisors make a sale, but also help them feel like they provided the right solution for the client. That helps everyone find success in the long run.
Joyce Schnur is the dean of Kaplan University’s School of Professional and Continuing Education (PACE).