Stressed Out Clients? 3 Ways Advisors Can Help

2020 has been…intense.  (I refuse to use unprecedented for obvious reasons).  Individuals are continuing to experience elevated levels of anxiety between the ongoing pandemic, questionable job security, and a new president in January, which will surely shake up the markets.  All this to say that people are stressed out, with concerns around personal finances being more prevalent than ever.  According to the recent Capital One CreditWise Survey, 73% of Americans rank their finances as the #1 stress in their life.  In the fintech space, and even more specifically, wealthtech, one of the most critical trends that has emerged is around the way people see their own financial lives. 

While the shift was already happening, COVID-19 is permanently changing the way investors seek advice, and advisors need to pivot quickly to meet those demands.  With investors not able to meet with their advisor in-person, many are struggling to understand what investment choices make sense in this challenging environment.  But this is good news for advisors looking to add value to their current clients and prospects.  As this rollercoaster of a year begins to wrap up, here are three ways advisors can quell those end of year financial doubts:

Be a guide: Advisors can demonstrate their value by encouraging clients to stay grounded and stick to their long-term investment strategy.  Uncertainty breeds emotional decision-making, and that recipe can be detrimental to long-term financial wellness.  Goals-based planning can help make a client’s financial goals more actionable, alleviating some of the stress due to volatility.  Client expectations are evolving, and advisors need to be able to provide personalized advice geared towards financial and life goals. Utilizing a digital platform can give advisors the ability to align their advice with the way clients think about their wealth.

Drive the digital experience: Innovative wealthtech firms are helping redefine the advisor playbook by driving a better digital experience for clients, ultimately leading to more efficient ways to receive financial advice.  Digital onboarding, which allows clients to open and fund a new account in just a few minutes, can help advisors connect the dots between their clients’ short-term financial wellness with longer-term financial goals.  Reassure clients that they’re on track through a digital advice interface that allows access to their comprehensive financial picture

Act as a generalist and a specialist: Many clients are looking for a wider array of financial and life-planning advice.  Advisors who can offer support and direction around investments, retirement, estate planning, succession planning, and more, will ultimately differentiate themselves.  The role of the advisor is becoming less transaction-focused, and more about high quality financial planning and education.  Take day trading as an example.  With traditional sources of entertainment being shut down this year, coupled with fears around financial stability, many individuals began buying investments, trying to capitalize on low valuations during periods of high market volatility.  Advisors can get ahead of the curve by speaking with clients about the dangers of day trading.  Day traders take on an incredible amount of risk in overly concentrated portfolios, which could lead to poor returns.  Financial advisors can educate clients on an array of topics and determine an actionable plan that will keep their full-life financial plan from going off the rails.

With only a few weeks left in 2020, advisors should continue to focus on deepening their client relationships to allay financial fears.  The trust barrier in the wealth management industry as always been high, and it’s imperative that advisors help clients achieve financial wellness, understand their goals and risk tolerance, and work in their best interest. 

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