IMCA Defines Wealth Management

 

IMCA Defines Wealth Management
Job task analysis identifies distinct knowledge and skills required to advise affluent clients

IMCA released a white paper on November 8 detailing the findings of a comprehensive job analysis that defines the practice of wealth management. In addition to clarifying what constitutes a private wealth advisor, IMCA will use the analysis to refine the experience, education, examination, and ethics requirements of its Certified Private Wealth Advisor® (CPWA®) certification program.

“Until now, no clear definition of private wealth advice or wealth management existed in the financial services industry,” said Sean R. Walters, CAE, executive director and CEO at IMCA. “This job analysis clearly defines wealth management as a distinct practice of advising high-net-worth clients with specialized expertise and skills. Financial advisors without this knowledge who work with affluent clients are doing them a disservice.”

Watch IMCA's executive director and CEO Sean Walters tell Investment News how IMCA arrived at its definition of wealth management and why professionals who advise high-net-worth clients should earn CPWA certification.

Job analysis studies are a common practice for certification bodies. Certification exams and the supporting requirements and curricula for certification programs are defined by a role delineation study of practitioners in the field. IMCA commissioned Kryterion Test Services, a professional certification test development and delivery company, to initiate the three-phase job analysis that began almost a year ago. Kryterion distributed an online survey to more than 43,000 financial professionals, and almost 400 respondents completed the survey in its entirety, which met the statistical sampling requirements. Click the image below for the executive summary white paper, which details the findings.  

Highlights from IMCA’s wealth management job analysis and the executive summary white paper, “Defining Wealth Management, Serving High-Net-Worth Clients with a Distinct Body of Knowledge,” include the following:

  • Wealth management is a distinct practice. Advanced competency in this discipline may be practiced by financial planners, accountants, estate planning attorneys, or investment professionals.
  • $5 million is the minimum net worth a client must possess to be considered a high-net-worth client.
  • The knowledge required to provide competent wealth management incorporates 169 topics within four knowledge domains: human dynamics, wealth management strategies, client specialization, and legacy planning.
  • The fundamental tasks and the process that private wealth advisors use in working with clients may be similar to financial planning—and many other client-oriented professions—but an advanced and unique set of knowledge and skills is needed to effectively serve high-net-worth clients.
  • The CPWA certification is the appropriate standard for advanced competency in this practice, and the certification will be adapted to more-effectively address the tasks, knowledge, and skills addressed in the study.

IMCA has administered the CPWA certification since 2007, and the program was operated as a certificate program since 2004. The procedures used in the job analysis study complied with all relevant technical and legal standards for professional certification and licensure as well as the requirements for accreditation by the National Commission for Certifying Agencies (NCCA) and the American National Standards Institute (ANSI).