This was a talk given on 7 April 2020 to financial advisors hosted by CSI.ca

I remember October 19th, 1987, like it was yesterday. My chest tightened as I watched the stock market fall in the largest percentage drop in a single day — over twenty-two percent, almost twice the second worst day in history, March 16th, 2020.

When the Phones Stopped Ringing

In 1987, everyone was in shock. Advisors were afraid to pickup their phones and clients avoided calling fearful of what they would hear. Offices were silent and everyone moved in slow motion. Older brokers reminisced about how it was just like ‘73 when they played cards with each other for weeks, because the phones stopped ringing and nobody would talk to them.

Finish Well

The threat we face today is the same, yet can be avoided by being honest with ourselves, our families, our employees, our clients, and prospects. The threat is real, but traumatizing fear is a choice. Whether we feel that the worst is over or yet to come, our objective is to finish well, both personally and professionally. Our family, employees, clients, and prospects are counting on us.

Mark Goulston, TEDx speaker and renowned psychiatrist said recently shared with Billy Bros: “What I’m hearing from people right now are three questions…

Am I going to get through this?
How will I get through this?
How can I help others get through this?”

You will get through this. We will discuss over this series the tools to help you get through this.

I would like to show you how to help others get though this.

Take Care of…

To help others, we must take care of ourselves first…and then those closest to us, and then our employees, clients, and prospects.We can only be valuable to others if we are whole ourselves.

We must first take care of ourselves and those dearest to us. They support us. They are the network that stands behind us, as we go out into the world to make a positive difference in the lives of our clients. Without their support we stand alone and our clients and customers suffer.

Look first at yourself and be certain you are doing what you need to do to be well rested, safe and at ease. Then connect with your family and friends, and make sure they understand your concern and desire for their best.

Checkin with your employees. They also feel stress and concern for your client’s and customer’s wellbeing, and they need to know you care and support the team in taking care of themselves and their loved ones. After ensuring that you and your support network are well, move our attention to the business.

Opportunity

We must partner with our clients to calm their fears and their concern for themselves and those they value. Clients are scared. Some feel their dreams are at risk. This is a rare opportunity to touch the lives of others in a meaningful way and help them achieve their dreams.

Whether you made or lost money for your clients, it is irrelevant in the grand scheme of things. There is nothing to do now to change the past. We can only change the present to impact a different future.

You are faced with a Great Opportunity. But before you pursue the opportunity you must settle your clients fears. You must reach out to them face-to-face, not one-on-one, but en masse as we are doing today. Time is of the essence. That may seem daunting to some of you, but hearing your voice is essential to relieving your client’s fear.

Use whatever technology that is available to you , Zoom, Skype, or GoToMeeting. Client privacy can be honoured as any participant can remain anonymous if they so desire. The most important means of comfort is for them to hear from you.

Schedule a private video session with your top twenty-five clients or customers. For all the rest, schedule one or more group calls. Client fears are greater than reality. In most cases a client’s situation is better than they imagine. However, fear can make us believe the worst will happen — the mystery of not knowing is frequently more fearful than the truth of reality.

Tell them your story.

Give them a positive, reasonable response to what is happening currently.
Remind them that times like these have occurred in the past and will occur in the future.
Help them establish a “long view” of the economy.
Use the example of trusted experts.
Re-explain to them that cash flow controls the market, not earnings or sentiment.
Re-confirm the disciplined process you have taken them through to determine their needs and the unique solution they have working for them currently.
Calm their worries about the future, remind them that we are the most adaptable species on the planet.
Offer them the opportunity to reassess their risk or comfort level.

Take action quickly, because there is greater work to be done.

Your clients were protected by some measure thanks to your disciplined investment approach. They perhaps did not lose as much as others they know, and will recover sooner. They need to understand that, due to the model diversified portfolio, prudent investment choices, and consistent oversight, they are positioned for recovery.

The Hard Truth

The hard truth is despite all this you will lose some clients, no matter how their portfolios performed. The problem today is that you do not know which clients will leave and which will stay.

Do not spend all your time trying hold on to a client you will eventually leave. Identify your “real clients,” the ones who will stay. Do not miss affecting the great change possible in the lives of your “real clients” and prospects.

There are two types of years in the market: client years and prospect years.

Client years, as we have seen for the past decade, are years where investors are happy and it is difficult to convince a prospect to move. The market is going up more often than down and their advisor seems to be doing a good job. The Investor is comfortable where they are.
Prospect years follow a major correction. Money goes in motion. With major declines like ‘87, ‘90, ‘96, ‘00, ‘04, ‘08, and ‘20 a lot of money changes hands. You can gather more assets in a single year than you have in a decade. Some of you are capable of doubling your assets under management in the next nine months.

During my career we doubled our assets under management in a single year three times, in ‘88, ‘91, ’97 — the years that following major corrections. Our team doubled assets again in ‘01, ‘05, and ‘09.

Hundreds of billions of dollars are looking for a new home right now. Decide where to place your focus.

Your clients are taken care of, it’s those outside your business that are in the most pain.

This opportunity to focus on prospects is limited. Once the economy strengthens and the good times return prospects are difficult to move because they are once again content with their existing relationship. Do not miss this opportunity , it rarely arrives. The potential for new growth occurs in difficult times and is exponentially leveraged when markets improve.

After you settle your client’s initial fears, remind them of the others they know who are worried and do not have someone like you in their life to help them assess their situation. Your desire to help their friends must be a “no cost, no obligation” offer, to meet with their friend, assess where they are and where they want to be in the future, and build an action plan to get them there.

You have a rare opportunity to ask a client to introduce you to others without any risk. Your clients know many who are scared and their friends may not have someone who is returning their calls. You will be surprised at the number of introductions that are only available during difficult times.

Your last action is to renew contact with all prospects. Prospective investors will be more open to change now than any other time. You have been busy, but if you would like to make 2020 the best year in your career, you have more work to do.

Next Actions

Settle your client’s fear and honestly assess their situation. Then quickly move your attention to those outside your business who are in great need of your services.

To help you over the coming weeks, I recommend you read the article “What Financial Advisor’s Can Learn from Behavioural Economics” on Gillian Leithman’s blog.

You have the greatest opportunity of the last decade before you. If you apply the concepts and tools, you will find the still centre within the chaos, comfort those around you, and help those in the greatest need.

This is the first in a series of articles about how to talk with your clients and how to help those outside your practice. Subscribe below to receive updates.

What to Say – Part One – After the Market Fell