Here are a few more of the traps your senior clients may find themselves in without the benefit of your financial guidance and counsel, and the ways to fix them.

The problem

“I don’t like totally safe investments right now, I am getting back in. Look at how much the market has gained.” This investment mistake is called “short-term memory syndrome.”

We quickly forget what happened last quarter in favor of what happened last week.But the stock market is based on earnings and GDP expansion. Everything else is sensitive to emotion and subject to volatility. This is also called “chasing returns.” There is a strong tendency for your prospects and clients to respond to news reports that tout something that happened today or this week while ignoring a longer-term perspective.

The fix
Talk to your seniors about the rule of 100. Discuss the level of volatility over the last two recessions if they had been fully invested without regard to their retirement horizon. Tell stories about seniors you have helped to weather the last few storms.

The problem
“Losses are only paper, it’ll eventually be fine. I don’t really care about losses right now.” This investment mistake is called “mental accounting.” The money you have is worth the same, no matter how you make or lose it. Still, subconsciously, people believe that some dollars are worth less than others, and therefore matter less. The notion is that my earned income is worth more than the money I make from investing. This is where the idea of “found money” came from.

While waiting for his wife to dress before dinner, a new husband decided to try his luck with $10 at a Las Vegas casino roulette table. $10 turned into $100. That became $1,000 and soon $10,000. Then he lost it all on his last roll. On the way back to his hotel room, he noticed $5 still left in his pocket. His wife asked about his luck, he said, “Not bad, I only lost $10.” Casinos always make money. Las Vegas hotel mogul Steve Wynn once said he has never seen a gambler make money over the long term.

The fix
Take out a $10 bill and give it to your prospect. Let them keep it long enough to feel like they own it. Then ask for $10 out of their wallet and tear it up. Ask which $10 was a gift and which was earned. Your point will soon be made. (You might want to give them another $10.)