Recently, The Wall Street Journal reported that J.P. Morgan Chase & Co.’s private banking group went through another layoff as it shifted its business strategy and increased its minimum investible assets from $5 million to $10 million. The rationale, as explained in the article, is that wealthy clients require much more attention, generate more fees, and have less risk than less lower income, middle class clients. The article continues: Wealthy clients also typically generate …
Using an arbitrary minimum asset level for clients unduly limits the market for financial services providers to those who have already “made it,” and ignores the substantial number of prospects that are ultimately headed for financial success. For advisors, using minimums often means excluding the coveted Millennial group because they do not meet asset requirements . . . yet. So why does the industry continue to focus on current asset levels? Defining target markets by …
According to Dalbar’s 2015 Quantitative Analysis of Investor Behavior (QAIB), the worst gap between market and investor performance in the past 30 years was in October 2008 when, as the report states, the S&P 500 index lost 16.8% but investors lost a little over 24%. There are, of course, many psychological factors that explain the disparity: behavioral finance biases that model why investors act irrationally. However, to be able to anticipate this behavior, and …
If clients are to increase their likelihood of becoming wealthy, they have to understand and change how they behave with respect to areas that are, perhaps, a little more personal. Clients that focus intently on what others buy and consistently want the latest and greatest in possessions (such as technology or accessories) are less likely to build wealth over time. Social Indifference predicts net worth regardless of age, income, or how much wealth one …
Can you identify the wealth-building potential of your prospective or potential clients? Is the coaching and financial mentoring you give to your clients based on an objective measure of their wealth-related behaviors? We are very pleased to announce the release of our new research report, Financial Behaviors & Wealth Potential. The report describes how using behavioral-based assessments can identify and develop one’s potential for building wealth. Applied broadly, measuring Wealth Potential can allow large institutions and firms …