We deal in facts and figures; no question about that.
However, as we cope with the business fallout from COVID-19 (aka coronavirus) it’s worth remembering that, when it comes to our clients, we are also dealing with the full spectrum of human emotion that comes with investing capital for the future.
The opportunity afforded by this crisis is for you to grow as a financial planner in two ways. One, to take stock of how you deal with uncertainty and build professional resilience. Two, to courageously step up for clients and provide the reassurance needed that their financial goals—and dreams—are still achievable.
We are about to have some difficult conversations, driven largely by fear. What I’d like to do is help encourage and reframe these conversations so that you can be in a place to offer empathetic insight to anxious clients wondering how COVID-19 will affect their money.
So where do we begin?
Prepare and Self-care
Before you even start to think about how to deal with the business fallout of the crisis, check-in with yourself to make sure you have the well-being tools at your disposal to cope and thrive. If you have a mentor, speak to them to establish context for what is happening. If you don’t, I recommend seeking out digital resources to gain a sense of perspective and direction. Josh Brown, CEO of Ritholtz Wealth, shared an inspirational talk he gave to safeguard the well-being of his team and help young financial planners navigate this crisis with their clients. Let Josh’s voice be your own!
Pick Up the Phone First
Be the financial planner who proactively reaches out to clients before COVID-19 panic motivates them to call in a frenzy. Check in with them first to see if they are doing OK, if their family is healthy and if there are any immediate ways you can be of help. Be as vulnerable as they are and have a human conversation before you pull it back to their financial plan and address any concerns about their investments.
Acknowledge and Repeat Their Concerns
When rational thinking is in short supply, our primary concern is to ensure our clients don’t derail their long-term goals and strategy. What some may be feeling right now is a fight or flight reaction, at odds with the logic that brought them to their investing journey. You can’t talk them out of how they’re feeling in this moment; it’s akin to telling someone with a cigarette in their mouth to stop smoking.
First, acknowledge that you’re thankful for them opening up—that it’s normal—and repeat back what you hear. Right now your client is looking for empathy and some emotional skin in the game, not a silver-tongued voice of reason. We get it, this sucks, now let’s take a deeper look together.
Before this conversation gains momentum, stop it in its tracks and create some space. Tell them you’re pulling up their file; put them on hold. This gives them a chance to pause (and center) and creates a platform for you to drive the conversation. Right now your client feels an absence of control over their external environment and they need you to remind them of what they can control: how to react.
As Dr. Robert Cialdini’s six pillars of influence, which he set forth in his book Influence: The Psychology of Persuasion, suggested now is also the moment to establish authority…quickly. Data and facts may not help irrational thinking, but clients still want to know you’re on top of things. Have your evidence-based information ready to start the conversation.
Refocus on Their “Why”
When you first started this relationship, you spoke at length about their financial goals, values and reasons for investing. That was a good conversation. This one can be too if you pull them back from the immediate reality they are focusing on and go big picture. Ask them once more about what the purpose of investing was and scale it back to what was always a longer-term timeline. Our worst decisions are made when we can’t construct a positive future, especially with the repercussions of COVID-19 confronting us daily. Remind them of their financial plan and use visuals to show that things will get better in the future. Even better, pull up their plan and show them that all their goals are still within reach.
Word Choice is Everything
Gently remind them that your strategy accounted for market fluctuations, even at this level. Use phrases like “Remember, we discussed” to reassure them that this is well-trodden ground and not unplanned for. Now is a good time to use empowering language to bring your client into feeling an active partner in what happens now, rather than a passive victim to the markets. It’s our strategy, it’s our financial plan and it’s our goal. Remind them to trust the decision-making skills that led them to invest in the first place.
Anchor Their Experience
Anchoring clients in recent history, with timelines, is also helpful. Provide the wider context, as you did at the start, that markets are cyclical. We fear bear markets because of fear of the unknown. Six years ago, we had a bear market. Do whatever you can to give things form by linking their experiences to the past. For example, the average bear market losses are X. The average bear market lasts this long. Again, be aware and intentional with the words you use. Focus on using positive words that infer we will get through this.
End with Hope
You didn’t have to rush to call the client, but you owned the situation and did. Your priority was to give some reassurance and a regained sense of control. You did this because you understand that living through a market downturn isn’t about portfolios and percentages for them. It’s about the thought of having to stay in a job longer, not being able to afford a child’s education, not seeing out a lifelong dream.
There will be many of these conversations ahead and I encourage you to embrace them. Contextualize each one around your client’s unique set of dreams and fears. Do that each time and you’ll provide the balance of normalization and hope needed.
Much better, you’ll strengthen the bond you have with your clients, through authentic, considered financial leadership.
Amyr Rocha Lima, CFP® is a partner at Holland Hahn & Wills LLP, a financial planning practice based in the United Kingdom. Recently named by Citywire as one of the UK’s Top 35 NextGen Financial Planners, Amyr specializes in retirement planning for successful business owners and senior professionals, serving clients in London and the South East of England. Follow him on Twitter @a_rochalima or check out his personal blog www.amyr.co.uk. Connect with him on LinkedIn.
Editor’s note: This article is in the forthcoming April issue of the FPA Next Generation Planner.