According to a recent economic forecast, one word has set the tone for Americans’ financial outlook in 2023: uncertainty. Economists have varying projections on how the U.S. labor force, the housing market and inflation rates will fare in 2023.
Some predict a recession, while others are more optimistic. A slight downturn in fuel costs and rent prices has many Americans hopeful that inflation might decrease too, the report continues. But there are still more questions than answers.
So, this begs the question: what actions can you take as a financial advisor to maintain strong client relationships and help them navigate this uncertain economic climate?
Why Communication Matters in Times of Financial Uncertainty
If you don’t invest in building trust with your clients, it will be hard to maintain those relationships in financially uncertain times. Be a true partner to each client—give them the courtesy of honest communication and mutual collaboration.
Considering this economy’s natural ebbs and flows, difficult conversations between you and the client are inevitable. That’s true even in periods of economic growth and stability. This nation (and the world at large) may feel more volatile now than in years prior and clients will want to know you can be trusted with their assets.
When your client relationships are strong, it’s easier to manage their expectations, alleviate fears, and, ultimately, retain their business. You can’t shield clients from an uncertain economic landscape, but you can help them navigate it as confidently as possible.
How Communication Boosts Client Relationships
When clients feel anxious about their financial situation, they’re more susceptible to making emotional or impulsive decisions during stressful moments. However, those emotional reactions can lead to regrets. As the expert, help your clients plan a well-informed course of action based on real-time data. In seasons of unpredictability, understanding metrics may help reinforce a sense of financial confidence. Empower your client with all the information they need to make strategic financial decisions.
Listen to Concerns and Offer Proactive Solutions
Finances are personal, so it can be terrifying when assets and investments feel threatened. Before you launch into the laundry list of professional financial services you offer, pause and actively listen to the client’s concerns. Validate their feelings and ask questions, so you have a clear idea of their needs. Then, based on this intel, you can give feedback and solutions to help them confidently move forward.
Help the Client Form Measurable, Realistic Goals
A study in the American Journal of Lifestyle Medicine reveals that when someone has access to financial coaching, they’re more hopeful about the outlook of their finances and more motivated to make behavioral shifts to reach a financial goal. Educating your clients on how to set and achieve measurable goals is essential. This means helping them develop a realistic plan to allocate resources and track their progress.
Find a Balance of Transparency and Reassurance
Your clients deserve the truth at all times. When inflation affects their retirement savings or cost of living, they don’t want a financial advisor to sugarcoat the reality. These conversations are often uncomfortable, but trust will only take root with honesty. Be a steady voice of reasoning so the client knows they’re still in capable hands.
Strong Client Relationships Are a Bedrock of Professional Financial Services
In an uncertain economy, clients need more support than ever. In many ways, their level of adaptability and resilience hinges on how much they trust the counsel of their financial professional. To help your clients navigate this volatile market with a focus on honest communication and mutual collaboration.
This is for informational purposes only, does not constitute individual investment advice, and should not be relied upon as tax or legal advice. Please consult the appropriate professional regarding your individual circumstance. Past performance is not indicative of future results, and forecasts are inherently limited and should not be relied upon as an indicator of future results.
Data contained in this material was obtained from third-party sources believed to be reliable; however, CIS, CAM and CIA do not guarantee the accuracy of the information.
Securities offered through Concorde Investment Services, LLC (CIS), member FINRA/SIPC. Advisory services through Concorde Asset Strategy, LLC (CAM), an SEC -registered investment advisor. Insurance offered through Concorde Insurance Agency, Inc. (CIA)