Man talking on phone

5 steps to providing perspective during volatility


Darren Crow, External Director – Practice Development

Great Practice Solutions

Talking to your clients during tumultuous times can be difficult and stressful. The key to success is being proactive, not reactive. Get in front of your clients’ fears by calling them early and often and making yourself available. Showing clients you have them in focus during these times is crucial. Here are five ways to help your clients through market volatility.

  1. Actively listen.

Allow your clients the opportunity to express their feelings. This is not the time to introduce your feelings about current events but to understand your clients’ perspectives. When you really listen to what they are trying to tell you, you are simultaneously showing concern and gaining insight into the issues that are most important to them.

  1. Help clients think forward.

Validate their concerns. Then, through active listening and feedback, steer your clients’ thinking forward in time. Help them envision what the situation will be a year from now, three years from now, and/or even five years into the future. Their thinking doesn’t even have to be about finances. This allows them to provide their own perspective.

  1. Ask permission to express your opinion.

Allow your clients to be in control of the conversation. Ask them if they would be interested in hearing your opinion about the current situation. Then, direct your thoughts toward their concerns. Remind yourself and clients that while you are an advisor, they ultimately have to decide what sounds right for them. Remind them that you are not just an advisor but also an investor. Your portfolio is likely experiencing the same volatility. Sharing what you are doing with your portfolio can be helpful, where appropriate.

  1. Reiterate the importance of portfolio diversification.

Remind your clients that we build diversification into our portfolios to help weather volatility. Markets do not always go up; if they did we would just own stocks. The bottom line is that you built their portfolio to give them the best opportunity to weather these conditions. In most cases, the best course of action is to not make wholesale changes in a reactive manner. However, be aware that when you recommend to hold a position, clients may have the impression that nothing is being done. Reassure them that the mutual fund managers we selected are working tirelessly for their benefit, making changes where appropriate and looking for long-term opportunities.

  1. Offer multiple solutions.

Focus on goals over performance. Ask yourself how recent volatility affects their ability to reach their goals. This is a great opportunity to revisit their financial plan and put into perspective the impact this has on their overall objectives. If a change is necessary, be prepared to offer multiple solutions based upon your client’s circumstances.

These five key actions allow you to drive client relationships deeper, establish that you care more about them than their money, as well as give them an opportunity to voice their own perspective. Provide answers when asked, ask questions to understand and listen to learn.

Help your clients navigate volatile markets.

Our Great Practice Solutions (GPS) program offers support as you help your clients through market uncertainty.

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