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Risk & Behavior

How to Manage Client Conversations During Turbulent Markets

This checklist provides behavioral techniques to help clients manage their emotions and their investments.

As the market pendulum continues to swing back and forth, many investors may be struggling to rein in their emotions. During these troubling times, financial advisors can use behavioral coaching tactics to help their clients manage their emotions and avoid making rash decisions.

However, we know this is easier said than done. Client conversations during market volatility tend to be more rooted in the need for reassurance rather than investment analysis. During times of high stress and uncertainty, both of these issues become more complicated as we struggle internally to tune out irrelevant information, have the strength to stick with the plan, and resist the urge to follow a fearful herd. enter image description here To help advisors manage clients during market volatility, we created a conversation checklist. It features behavioral techniques you can use to combat the psychological struggle your clients may be facing right now.

A Framework for Handling a Variety of Client Situations

Investors will handle their emotions in their own ways during these turbulent times—not all of them will necessarily be in a state of panic. Some investors may be wary of the situation and curious as to how they should respond. No matter how your client feels, there are steps you can take now to ensure their emotions don’t interfere with their financial decisions.

Our checklist offers suggestions for how to navigate client conversations based on a few different situations:

  • If your client is relatively calm but is reaching out to you, this is the time to prepare your client for any emotions that may appear down the road.
  • If your client is already overwhelmed by the current volatility, focus on ways that you can help them avoid knee-jerk reactions. The aim of this scenario’s techniques is to help your client take a step back from their emotions and engage in a more thoughtful decision-making process.
  • If your client hasn’t connected with you yet, you can be proactive in developing the appropriate way to handle the situation.

Our checklist breaks down the messaging you can use with your clients in all of these situations. It also discusses the tangible next steps you can suggest clients take to stay calm, manage their stress, and remain focused on the bigger picture.

Helping Investors Through This Tough Time

As investors struggle with changes in their routine, market volatility, and COVID-19, an advisor’s role as a behavioral coach may be more important than ever. Behavioral techniques can be an effective way for advisors to help ensure that these current stressors don’t impact their clients’ financial decisions.

Download our checklist to learn how to manage client conversations during turbulent markets.
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