Also, it suggested that using a goals-based planning approach where clients’ wealth is separated into different accounts can help advisors to better assist clients to measure their progress toward certain goals such as saving for retirement or purchasing a home). Forty-seven percent of advisors said this strategy is “very effective.”
Additionally, the survey noted that advisors and their clients could benefit from more behavioral finance education, training, support and tools. But many advisors say they lack the resources and tools to bridge the gap between the concept and practical application.
Nearly two-thirds of advisors (65%) said the primary reason they don’t integrate behavioral finance into their practice is because they have difficulty translating behavioral theory into implementation. More than half (54%) said lack the software/tools to do so.
The survey, conducted by Cerulli in July, included members of the Investments & Wealth Institute and diversified among business models including wirehouse, registered investment advisor (RIA), and national and regional broker dealers.