Inside Morgan Stanley’s HNW Advisor training course
- Each year, around 100 Morgan Stanley advisors are trained to earn the title of Director of Family Wealth.
- The hardest part of the 150 hour program is a live case study.
- Morgan Stanley executives Alex Chester and David Bokman share what shocks advisers the most.
Each year, about 100 Morgan Stanley advisors take an exam to work with wealthy families. Only about 60% pass on the first try, and about 75% eventually pass after retaking the course, sometimes multiple times, and that’s the bottom line.
“We don’t have the required number that we’re looking to get into the program,” Alex Chester, who heads the bank’s family wealth manager program, told Insider. “We want to make sure that the advisors we promote are equipped to work with the best clients in the firm.”
The in-house training course leading to the test takes around 150 hours, Chester said, depending on the adviser’s previous experience level. Applicants must study 17 modules, most of which focus on estate planning, and then pass a written exam. Family clients can be lucrative because advisors can sell them a wide range of products such as loans and philanthropy advice.
Studying in addition to a full-time job is the easy part. What shocks most advisers is the final part: a live case study.
Morgan Stanley Family Office Resource Manager David Bokman and his team claim to be a high net worth client and their accountant or lawyer. Advisors have one hour to speak to the bogus client and three additional hours to provide detailed recommendations.
Bokman gave a hypothetical case study: a couple with a wife selling a successful business from which the husband had inherited wealth. Part of the challenge is asking the right questions to learn that one of their three children is addicted to drugs and that the couple aren’t sure exactly how much to leave each child given their different needs.
“There might be a family dynamics challenge that we don’t necessarily tell you about, but the facts would lead you to ask the questions to find out,” Bokman told Insider. “If you haven’t found out, you’re going to have it. a lot of difficulty coming back with solutions. “
As of 2019, each advisor in the Private Wealth Management division, who works with clients valued at $ 10 million or more, must complete at least one abridged version of the course. Each team must nominate a member to complete the full program and exam and obtain the distinction of director of family patrimony. This applies to new hires and internal staff who want to take it to the next level and work with wealthy families.
The course has been updated over the years, with recent new modules on Behavioral Finance and Impact Investing. They plan to add a unit on lifestyle counseling – Morgan Stanley-approved companies ranging from private aviation to concierge – as well as specific lessons for working with executives, in light of the acquisition by Morgan Stanley of E-Trade, which has a strong corporate action plan business.
But estate planning remains the bread and butter of training, said Bokman, an attorney specializing in trusts and estates. Part of the course teaches techniques for raising personal questions about inheritances and selecting trustees in early conversations.
“Often, because it’s sensitive, there can be caution on the part of the client and the advisor,” he said. “And yet that sensitivity actually suggests that you want to bring them up as quickly as possible, because what you don’t want to do is go too far down the path of an investment plan, a charity plan. , of an estate plan, without understanding what these problems are. “