The bad news emanating from today’s financial markets is enough to drive even the most successful financial advisor under the desk and over the edge.

But to be successful over the long term, it’s more important than ever to be positive and proactive. Reaching out to clients in today’s difficult market–particularly 401(k) participants–can help position you to manage more assets in better times.

So what do you say to your clients when you finally summon the strength to lift that 500-pound phone that has become the immovable object for the past few months? There are 6 key points to make:

(1) Don’t panic. Most likely, you need to treat your clients for “statement shock” after they have viewed their most recent 401(k) statement. Remind them that their retirement savings represents a long-term investment and, as such, can potentially repair itself over time.

For clients who are unnerved by market volatility–and who isn’t today?–suggest an asset allocation model to provide investment discipline and all-weather diversification.

(2) Gear your discussion to the age of your client. If your client is 35, point out that he or she is in the market for the long haul and has another 30 or 35 years to recoup losses. If your client is older, say 55, offer to conduct an in-depth needs analysis, re-examine his or her risk tolerance, and review the time horizon until retirement.

Depending upon how close your client is to retirement, it may make sense to shift more assets to cash. Don’t forget, though, that today’s stock market now resembles Filene’s Basement, with bargains available to savvy shoppers. Reexamine what sectors and individual stocks are poised for a rebound.

(3) Perform a gap analysis. No doubt your clients’ market losses have created a bigger “gap” between what they have accumulated for retirement and what they need for retirement. Take account of all of their assets–retirement investments, savings, home and other property–when calculating what assets are available for retirement. Your clients most likely think the gap resembles a crack in the sidewalk when in reality it’s closer to the Grand Canyon. Once you know the real gap, you can help clients create a realistic action plan.

(4) Don’t stop deferring income. Many people have stopped contributing to their 401(k) plans, a big mistake that should be avoided at all costs. Once clients stop, they find it hard to start contributing again because they become accustomed to having a bigger income. If they truly need to reduce contributions, don’t cut back below the amount needed to qualify for the company’s matching contribution. Doing so leaves free money on the table.

(5) Avoid taking a loan if at all possible. Many people struggling to make ends meet in this economy are resorting to taking hardship loans from their 401(k) plans. These loans have to be paid back within 5 years. If not, both taxes and penalties must be paid on the outstanding loan balance.

(6) Consider making Roth 401(k) contributions. Plan participants can make some or all of their current and future contributions on after-tax basis, meaning the income they take out of the plan at retirement is tax-free. This can be a great way to boost income from future retirement savings, especially for clients whose retirement savings may be battered from the recent stock market volatility.

Keep your chin up

So don’t despair and don’t hide. Helping clients navigate through these choppy waters can help you shine in their eyes and enhance your relationships. And in this business, relationships are everything.

E. Thomas Foster Jr., Esq., is Hartford’s national spokesperson for qualified retirement plans. You can e-mail him at tom.foster@hartfordlife.com