As I write this column, it’s early February. The media has been chock full of ominous economic reports. Unemployment is edging higher. Growth is slowing, yet inflation is obvious. Home equity is evaporating as housing prices plummet. Credit card defaults are growing. The sub-prime mortgage crisis has generated billions of dollars of write-downs on Wall Street. But you know what? I’m ready to crack open the bubbly, and here’s why:

First, it looks like our economy is resetting itself after years of easy money, speculation and excess. By slowing down, it’s actually laying the groundwork (hopefully) for a new phase of more rational and sustainable growth.

Second, we now have a great opportunity to question our fundamental assumptions. For example, we can ask ourselves (1) whether we’ve been giving clients ethical advice and (2), whether we’ve been ethically managing ourselves.

Let’s address the first question now. Next month, I’ll address the second.

Think about your client relationships in times of prosperity. Everyone’s making money. Optimism is high. People don’t think they can make a bad investment. And they forget what it’s like to use real money for major purchases instead of leverage.

In this environment, have you been more of a cheerleader than an advisor? Have you egged clients on to consume more, invest more aggressively and live a platinum life today? Or perhaps you’ve been their financial shopper, finding ever more clever products that just may generate higher investment returns for them and greater compensation for you, but that relegate downside risks to the fine-print disclosures.

Well, folks, now that we’re transitioning to a slow- or no-growth economy, it’s time to bring your clients back to earth; to get real with them and with yourself. Here are three avenues to consider:

First, get real about risks. Don’t just complete the obligatory risk analysis worksheet and file it away. Get your clients to really talk about their feelings about possibly losing their money. Challenge them to defend their desire for returns that require riskier strategies. And don’t proceed further until both of you are clear about the amount of reasonable risk the client – and you – are willing to take.

Second, get real about expectations. Many clients have difficulty adjusting to new economic realities. If your clients still believe they can achieve head-spinning results in today’s climate, you may need to adjust their attitudes.

Third, get real about what constitutes the good life. When clients become obsessed with consumption, then a recession will hit them very hard. If they can’t continue their torrid pace of consumerism, then their world might literally fall apart. During a downturn, tell your clients it’s OK to buy a little less; to create a lifestyle a notch or two less expensive than it needs to be.

My point is this: a slowing economy isn’t a tragedy. It’s a time to celebrate the wonderful lives we have today – and to get smarter about creating the lives we want tomorrow.