You live for days like this. The market is strong as the bears hibernate and the bulls stampede. Wall Street pundits and prognosticators are optimistic, forecasting more market sunshine and blue skies in the days ahead. You begin your workday with a spring in your step because you have good news to share with happy clients and prospects who are anxious to invest. By all accounts, it is a great day to be a financial advisor.
Now, back to reality.
Be The Calm In The Storm
There will be those good times when everything goes right, but as sure as sparks fly upwards, the not-so-good times can be and often are just around the nearest corner. Sir Isaac Newton was alluding to the Law of Gravity when he stated that “Whatever goes up must come down,” but financial advisors know well those words also explain how markets historically react.
When markets get shaky, so do many advisors. They become rattled. They get rattled by market uncertainties and they especially get rattled at the prospect of having to share bad news with good clients. It’s this last part – telling clients what they don’t want or like to hear – that advisors dread doing the most. No advisor wants to be the bearer of bad news, but unfortunately, it’s sometimes part of the job.
When Markets Fall, Rise To The Challenge
What often separates average advisors from their high-performance peers is not what they do during the good times. They differentiate themselves by demonstrating their exceptional value when times get tough. Investors are like passengers on a plane traveling through turbulence. They want reassurance that no matter what is happening, everything is under control and that they have expert crisis management when it is needed most.
High-performance advisors talk the talk and walk the walk. They maintain a positive attitude even when the market is negative. Top advisors never tap dance around or try to sugar coat bad news. Instead, they are forthright and honest about the situations at hand and their focus is less on what’s happened and more on the plans going forward.
Sympathize and Strategize
Great advisors are more accessible during uncertain times. They don’t wait for the uncomfortable calls from clients. They are proactive and contact clients first, knowing that time is always of the essence in financial matters. Investors are often emotionally impacted when their portfolios take a nosedive, so always acknowledge their feelings and share your concern because it shows them you are listening. Market downturns can also provide astute advisors with incredible opportunities to show clients how much they care about them as people first and that’s a difference maker that breeds long-term relationships.
Top advisors never shoot from the hip when discussing bad news with clients. As soldiers train for battle and medical center trauma staff prep for emergencies, great advisors anticipate market downturns and react swiftly and decisively when they occur. The maxim of “failure to plan is planning to fail” is not in their lexicon. Top advisors are prepared for anything and everything that might happen.
Experience matters, especially when markets tumble. Remind your clients that they are not alone, that they have a trusted, experienced partner they can rely upon during tough times to help them make the right decisions. Explain to clients that what’s happening may be new to them, but they can take comfort in knowing they are represented by an advisor who has been through similar firestorms over the years and helped people like them not only survive but thrive when the smoke cleared.
Communicating effectively with clients is always important no matter which direction the market swings, but it is a high priority expectation of clients when downturns occur. Most investors will tolerate the up-and-downs of the market, but many cite poor communications with their advisors as a primary reason for walking away from the relationships.
If you want your clients to trust you, to be loyal to you and especially, to value you – learn how to convey bad news with the same level of professionalism that you convey the good news. How you communicate bad news can actually strengthen your client relationships, so learn how to do it right.
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