How Advisors Are Supporting Clients During COVID-19

Economics has been labeled “the dismal science.” I prefer to call it “the illuminating science.” This discipline enlightens us about the workings of our world. The coronavirus pandemic is no exception. Its disastrous effects have echoed through capital markets, corporate offices, and community spaces. Nearly every industry has been touched by its virus-ridden hands. Joining us to speak on this topic was Sarah Foster, Federal Reserve & Economy Reporter at Bankrate. From Pennsylvania to Pune, we came together to learn about the cost of COVID-19.

We began by discussing the response of the Federal Reserve (the Fed) to coronavirus. Sarah noted that this year, the Fed has gone farther and faster than ever before. Such magnitude speaks to the severity of the economic shock. The Fed answered the markets by adjusting interest rates and influencing the cost of credit and borrowing. When the cost of borrowing decreases, consumers are incentivized to spend, theoretically catalyzing economic growth. Other actions taken by the Fed include: eliminating reserve requirements, instituting an unlimited bond-buying program, and creating emergency lending programs. Some of these indicate a reversion to the 2008 crisis-era playbook, others are new solutions to new issues. Unfortunately, even with all of these actions, the Fed cannot cure the coronavirus and it could be called on to do more. Cash may be king, but it’s no doctor.

According to Sarah, one new issue is the causative relationship between health and human hardship. This time, it’s not just banks that have been hit with the economic strain – individuals and families are suffering, too. Back in January, Bankrate’s Financial Security Index survey revealed that only 41% of Americans could afford a $1,000 emergency expense. Fast-forward four months and this same survey found that 23% of Americans identified insufficient emergency savings as their biggest financial regret. For many families, the Great Recession never ended. These conditions have set the stage for financial advisors to educate, empower, and encourage clients. To serve those who were unprotected and unprepared, Sarah recommends working from a place of understanding. Remind your clients of their goals, the cyclical nature of the market, and your fiduciary commitment to them. Focus on the importance of building savings for unexpected expenses and keeping a long-term perspective. Uncertainty is certain and advisors can act as a compass to help clients navigate these times.

Sarah also shared that advisors now have an opportunity to serve as advocates and changemakers. Earlier this year, Gary Cohn, Former Director of the National Economic Council, released a statement saying, “It’s clear that the COVID-19 pandemic has highlighted inequality in America while simultaneously increasing it.” Racial and ethnic minorities, as well as the economically fragile, are bearing a disproportionate burden. Social and institutional barriers matter – where we live, work, and play can significantly impact our health and wellness. According to a recent Bankrate survey, nearly 1 in 3 Americans turn away healthcare due to cost. Given the current pandemic, people are experiencing the compounded loss of healthcare and employment. Because of this, essential vaccines, examinations, and treatment may be missed. Those of us in the financial services industry need to work to fight this systemic inequality. Everyone deserves a future of opportunity, and we are in a position to help achieve that.

It’s impossible for anyone to predict their future, but we can all be prepared and aware. We can educate ourselves on ways to flatten the curve and preserve our financial confidence. We can also take time to reflect. From this pandemic, we learned how the Fed works to stabilize markets. We saw the state of personal finance and the need for supportive advisors. We heard the voices of those speaking up and out for greater improvements to our nation’s structures of care. For now, we wait and hope for breakthroughs with vaccines and recoveries. The coronavirus pandemic has wreaked havoc on our world. We are masked; the economic impact is not.

For more information on Sarah Foster’s work, connect with her on LinkedIn at and follow her on Twitter at

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