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Richards, Crosby, Others Discuss How to Calm Clients in the Time of Coronavirus

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Calming anxious clients during a financial crisis is nothing new for financial advisors, but addressing that anxiety during a worldwide pandemic is something else entirely. 

Not only have clients suffered severe losses in their equity portfolios — U.S. large-caps as of Friday’s close lost about 20% of their value in a little over three weeks — but many are under pressure from school and office closings and fears about their own health — pressures many advisors may also be experiencing.

“This dislocation is different from a lot of previous ones,” says Daniel Egan, director of behavioral finance and Investment at Betterment, noting that clients are also expressing stress and anxiety unrelated to the market.Egan was one of several behavioral experts participating in a webinar on Calming Anxious Clients About Coronavirus organized by blogger and XY Planning Network co-founder convened Michael Kitces. Here are some highlights.

When Your Client Calls

Start with expressing your empathy, acknowledging your client’s fears. “This is our job, being the release valve for other people’s uncertainty and anxiety,” said Carl Richards, a certified financial planner and author of “The Behavior Gap.” He suggested that advisors first thank their clients for calling, then pause, creating some space before responding. “Hold on while I grab your file,” or say some words to that effect.

Clients don’t want to hear facts and figures about what bear markets do or the bull markets that eventually follow, according to Richards. “That’s like talking to a smoker when he’s smoking about the problems of smoking,” says Richards. “It doesn’t go very well.”

Meghaan Lurtz, professor of practice at Kansas State University’s Institute of Personal Financial Planning and a senior research associate at, said advisors should repeat back what each client tells them and then ask the client to tell more.

That allows the advisor “to get to the why” of the call and “to answer in an individualized, more authentic way” even after they’ve received 25 or 50 calls from different clients, Lurtz said. 

Kitces recalled a young client who lost about $10,000 in a rollover IRA during the 2001 market downturn. It was built from annual $2,000 contributions so the client didn’t view the loss as a dollar amount but as five years worth of savings.

Daniel Crosby, chief behavioral officer at Brinker Capital, who was previously a clinical psychologist, said it was important to not only listen to clients but also provide them with something at the end of the conversation so they feel that something was accomplished. It could be something to read, says Crosby, or some rebalancing or a change in their asset allocation, says Kitces.

Clients “need to walk away feeling they’ve been heard, they understand their financial plan and are confident about the person in charge of their plan,” Richards said.

Which Clients You Should Call

Egan of Betterment suggested that advisors think about which clients are the most important to reach out to during a crisis. “Keep track of everybody,” he said.

“Reach out to the nervous Nellies even if they haven’t called you yet,” Kitces said. One way to identify them: They log in the most frequently to client portals, according to Kitces. “You want to be proactive but you don’t want to scare clients.”

Richards recommended that advisors call every client during times like the present. ”Everyone is feeling uncertain about what’s going on today. It’s safe to assume they have read the news. Tell them ‘I’ve been thinking about you and just wanted to check in.’ “

Beyond Phone Calls to Clients

“One of the most impactful things is to send a video,” said Egan. “Not an email or text message, but a video where clients can see and hear you.”

Advisors can also use the current coronavirus crisis to help drum up new business. “Educate the public, share knowledge, at events or on social media,” said Crosby. “There is so much hunger for this.”

Richards suggested telling current clients, “If you have a friend or family member who is worried right now, I  can talk to them,” and consider video calls for this. “Look for ways to help people find a place to talk.”

Give Clients Hope

Remind clients that bear markets happen and then recover, Crosby said. He shared a chart showing average annualized equity returns of 9.6%, but after a 20% market drop, a 12% annual return over the next five years. “Construct a future,” Crosby said. “Tell clients, ‘You were here for the risk. Will you stick around for the reward? … We need to let clients understand the future is not like today.”

What Not to Do 

Don’t email reports recapping what the market has been doing and where it might be going. “Don’t bother. Share that you care about them. Emphasize the relationship” and why the client hired you, said Crosby. “This is when you earn your money,”

“Don’t send the template weekly report,” said Richards.  It comes across as tone deaf.” He suggested instead in-person meeting, phone call, video or personalized email. Make it “relevant and personal.”

Remember Self-Care

Financial advisors are likely to take on some of their clients’ trauma, which not only harms the advisor but affects their ability to serve their clients. “Be good to yourself,” advised Lurtz. “Self-care is not selfish.”

“You can’t help anyone else if you are literally burning yourself out,” Kitces said.

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