knowledge topics
Motivation
KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify when motivation to engage a financial planner may be greatest, such as:
- Loss of spouse
- Retirement
- Divorce
- Loss of parent
- Birth of child
- Insurance settlement
- Inheritance
- Lottery windfall
- Career change
- Business succession
- Identify motivations to seek financial advice, such as:
- Desire to reduce complexity
- Desire to take action
- Desire to save time
- Desire to receive encouragement
- Desire to help make better trade-offs
- Desire to help them persist
- Identify the conditions that must be in place for change to occur.
- Individual perceives a need to change
- Individual possesses motivation to change
- Individual perceives that they have the ability to change
- Identify behaviour changes to which adherence is most likely, such as:
- Single behaviour
- Requires short term commitment
- Relieves immediate pain
- Implementation is easy and simple
- Accompanied by high degree of support/supervision
- Identify behaviour changes to which adherence is least likely, such as:
- Requires broader lifestyle changes
- Requires longer term commitment
- Focuses on prevention
- Implementation is painful, complicated, visibly different
- Heavily reliant on will power
- Identify the types of behaviour that may signal resistance to change, such as:
- Agreement, but failure to act
- Ambivalence
- Arguing
- Closed body language
- Denying
- Defensiveness
- Interrupting
- Ignoring
- Negating
- Reluctance
- Resignation
- Rationalizing
- Rebellious
- Explain reasons why resistance to change may occur, such as:
- Do not perceive that there is a need to change
- Motivation to maintain status quo is stronger than motivation to change
- Ambivalence to change
- Identify factors that impact motivation to change, such as:
- Emotions / Feelings
- Knowledge / Understanding
- Risk / Uncertainty
- Perceived value
- Cost (e.g. dollar, time, commitment, emotion)
- Identify the dominant motivational focuses that may occur.
- Promotion focus (i.e. goal achievement)
- Prevention focus (i.e. objective avoidance)
- Identify language that may motivate a promotion focused individual, such as:
- Optimistic
- Benefits
- Lost opportunity
- Identify language that may motivate a prevention focused individual, such as:
- Pessimistic
- Risk avoidance
- Identify procrastination or avoidance actions that may signal non-readiness to change, such as:
- Failure to seek advice
- Refusing engagement
- Missing appointments
- Failing to return communications (i.e. phone calls, e-mails, mailings)
- Failing to complete paperwork
- Short attention span
- Closed language
- Short responses to questions
- Superficial responses to questions
- Failure to disclose information
- Omission of information
- Identify behaviours that may inhibit motivation to change, such as:
- Lecturing
- Admonishing
- Scolding
- Setting deadlines
- Giving orders
- Blaming
- Warning or threatening
- Persuading with logic
- Moralizing or preaching
- Judging or criticizing
- Praising
- Shaming
- Victimizing or sympathizing
- Identify behaviours that may motivate change,† such as:
- Encourage a future orientation
- Establish pre-commitment strategies
- Establish structure for change
- Identify how a financial planner may support in developing a future orientation,† such as:
- Explain how a financial planner may establish pre-commitment strategies,† such as:
- Change peer group and social rewards
- Decrease immediate payoff of negative action
- Increase immediate losses of negative action
- Increase future payoff of positive action
- Decrease future losses of positive action
- Increase the number of options associated with negative action
- Decrease the number of options associated with positive action
- Identify behaviours that may increase the losses felt by an individual,†† such as:
- Paying for current consumption with cash versus cheque or credit card
- Contributing/investing in illiquid assets
- Property
- Retirement plans requiring taxes to be paid on withdrawal
- Investments with pre-maturity penalties
- Savings accounts earmarked for a specific goal
- Identify behaviours that may reduce the losses felt by an individual,†† such as:
- Pre-paying for services
- Paying oneself first
- Pre-authorized savings plans
- Commit to saving increases in income
- Commit to saving portion of tax refund
- Save coins or change (e.g. round up purchase and contribute to savings account)
- Explain methods that a financial planner may use in responding to an individual who is resistant to change.
- Simple reflection
- Amplified reflection
- Double-sided reflection
- Agreement with a twist
- Shifting focus away from what is impeding progress
- Reframing
- Rolling with resistance
- Emphasizing personal choice and control
- Siding with the individual’s argument against changing
- Explain how a financial planner may establish structure for change, including:
- Create a financial plan
- Provide step-by-step guidance
- Provide support
- Create peer pressure
- Create social proof
- Define motivational interviewing.
- Explain the purpose of motivational interviewing.
- Identify motivational interviewing techniques,††† such as:
- Maximize questions and minimize statements
- Express empathy
- Articulate non-judgemental curiosity
- Evoke and/or sit with ambivalence
- Avoid argument
- Roll with resistance
- Support self-efficacy
- Identify ways to express empathy, such as:
- Acknowledge the individual
- Summarize and reflect back to the individual their attitudes/motivations
- Invite discussion towards change
- Identify ways to address ambivalence, such as:
- Ask the individual to identify why they may wish to change
- Ask the individual to identify what obstacles they perceive are standing in the way of change
- Ask the individual to identify if maintaining the status quo is acceptable to them
- Identify ways to roll with resistance, such as:
- Ask the individual to identify what obstacles are impacting their ability to change
- Reflect back to the individual what their obstacles are
- Encourage the individual to identify possible alternative solutions or viewpoints
- Define self-efficacy.
- Identify that the most important predictor of sustainable behaviour change is self-efficacy.
- Identify ways that a financial planner may support self-efficacy, such as:
- Encourage
- Motivate
- Help remove obstacles
- Provide on-going contact/follow-up
- Review progress
- Provide social comparisons
- Relieve pain or negative effects of change
- Identify ways that a financial planner may help an individual sustain change, including:
- Ask disconfirming questions
- Have individual identify triggers that may cause them to revert back to previous behaviour
- Have individual identify methods to avoid and/or mitigate triggers that may cause them to revert back to previous behaviour
- Engage in regular contact
- Provide encouragement
- Facilitate removal of obstacles
- Explain the importance of detached involvement.
- Explain the importance of how information is framed.††††
† Russell, James. This is your brain on finances: Advising imperfect humans. (2011). Retrieved from: http://www.slideshare.net/rnja8c/behavioral-finance-for-financial-planners
†† Russell, James. Texas Tech University. http://www.slideshare.net/rnja8c/behavioral-finance-for-financial-planners
††† Vallis, M. Motivational communication. Behaviour Change Institute. Retrieved from http://www.behaviourchangeinstitute.ca/Motivational_Communication.html and Vallis, M. MI 2. Behaviour Change Institute. Retrieved from http://www.behaviourchangeinstitute.ca/MI_2.html
†††† Kahneman, Daniel. (2011). . New York: Farrar, Strauss and Giroux See pages 364 – 374
Glossary of Verbs (mouse over to see definition)
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a judgement through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
