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Taking your Financial Planning Recommendations to the Next Level with Behavioral Finance Part 2


Jasen Braun, CFP®, MBA, CRPC®, BFA™
Business Development Director

 - Financial Planning Process
 - Menu of Services
 - Segmentation/Grading
​ - Practice Valuations
 - NaviPlan Expert

Behavioral Finance is the integration of psychology and the physiology of the brain with traditional financial principles. The purpose of Behavioral Finance is to provide a greater understanding of the role that emotions play in the decision-making process, and to provide tools and techniques to help utilize that knowledge to make more rational, values-based decisions.

Read on to learn more about how you can provide better, more personalized advice to your clients that sets you apart from others in the industry.

What are the recommendations requirements at Ameriprise?

Compliance policy requires that every year, for all topics on which you and the client agree, you must provide to your financial planning client written recommendations that are: 

  • Specific, actionable, and reasonable in light of the client’s financial circumstances
  • Tailored to the client’s goal(s)
  • Written in plain English
  • Truthful, accurate and not misleading
  • Portable

From a compliance perspective, financial planning recommendations can be simple and vague. If you are complying with the standards above, you are covering the requirements from Ameriprise.

Taking your recommendations to the next level
With financial planning software, you can create compliant recommendations and deliver them swiftly to the client; but, are simple recommendations providing real value to the client?

As the financial services industry continues to be scrutinized for fees charged and services provided, it is more important than ever to set yourself above the standard.

How do you differentiate yourself from the financial planning offered in the industry?

One way to provide value to clients is to utilize Behavioral Finance techniques taught in the BFA™ from Think2Perform. Helping clients develop their values and then tying those values into your financial planning recommendations can set you far above what clients are receiving from other financial advisors in the industry.

How to build recommendations utilizing client’s goals and values

In the financial services industry, we sell intangible items. They aren’t getting that immediate satisfaction of buying a big screen T.V. and watching it immediately. So how do we make our industry sell something tangible? We tie their values and goals in with our recommendations.  
For example, let’s use a client example of a couple who share the value of travel, and they need to save more for retirement. However, they are having a difficult time finding the value in saving more now for their retirement.
You’ve done your analysis for their financial plan, and your recommendations are to have them contribute 5% more to their Roth 401(k) to build up tax-free retirement income.

Recommendation example:
Mr. & Mrs. Client: We recommend that you both increase your Roth 401(k) contributions with your employer by 5% to increase your likelihood of retiring at age 67.
This is a good recommendation that completes your compliance requirements at Ameriprise but, how can we take it to the next level using their goals and values?

Recommendation example using behavioral finance:
Mr. & Mrs. Client: We recommend that you both increase your Roth 401(k) contributions with your employer by 5% to improve your likelihood of retiring at age 67 with the opportunity to travel more frequently during your retirement years.
It doesn’t take much effort to tie together client’s goals and values with financial planning recommendations, but it can provide an amazing client experience that clients more than likely will not receive from other advisors in the industry.
This not only provides more value but also psychologically gives the client something tangible to look forward to in the future.

Taking the next step
To register for the BFA™ designation program, visit https://www.kaplanfinancial.com/bfa/, or call Kaplan at 1-800-717-3650. Ameriprise advisors and staff receive a discount on the program, so be sure to let Kaplan know that you work with Ameriprise to receive the correct discount (see details below). As a best practice, we recommend that you call Kaplan to make sure the discount is correctly applied.

  • Retail price:  $970 ($895 course fee + $75 testing fee)
  • Our price:  $674 ($599 course fee + $75 testing fee)

We at the Jambalaya Group believe this designation represents an important step in the evolution of financial advice and will equip advisors to provide better, more personalized advice to their clients. If you have additional questions, please contact or Jasen Braun (jasen@jambalayagroup.com) with the Jambalaya Group.