How advisers should navigate this bear market

Guiding jittery clients through rough financial patches is one of the most important things advisers do, but they need to keep themselves from being emotionally drained by the effort.

Generally, being an adviser is a great life. But you can’t ignore the fact that it’s been a particularly challenging year for our profession, as client workloads are up while profits are down.

While most clients have a decent grasp of the fact that market cycles don’t last forever, it’s those who call every week that can drive you batty.

You know the clients I’m referring to. They called you in February, March, April and May to inquire about moving to cash. In June, the message shifted to: “I told you we should have sold earlier.”

But the fact is that guiding jittery clients through rough financial patches is one of the most important things we do. Because a vast majority of those people who move to cash after the market has tanked never fully recover.

Again, after a decade-plus bull market, I’m not complaining. But it’s a challenge to maintain healthy emotions in bear markets when, month after month, work becomes exceedingly stressful.

But as an adviser, you’re a leader in the firm, and your clients, your employees and your organization need you to be in good spirits so you can guide them with empathy and optimism.

So how do you avoid being emotionally drained by anxious clients? Here are a few things that have worked for me.

I’m human. I respond to warmth. So first thing each day, I call a few clients who really like me. Every adviser has a group of clients who loves them, trusts them and treats them as family. These are the clients who are as concerned about how you are doing as they are about their own financial lives. When you’re having a tough day, pick one or two, call them and check in. These people will remind you that you’re not an idiot.

Next, block off client-free time. Most psychologists don’t meet with clients every hour of the day because it’s too emotionally draining. In fact, many limit their client workload to 20 hours per week. Schedule some time when you’re not available for client communications and use this time to do other things that are beneficial to your practice, and to you.

Next, because almost nothing feels better than accomplishing something positive in a tough business cycle, take some time each week to focus on finding new clients. Ask your favorite client for a referral. Offer a free retirement planning workshop you never tried before. Call some warm leads from the past. No matter what your marketing approach is, you’ll have much greater success at finding new clients if you habitually block off some time when you’re unavailable to outside distractions.

Lastly, take time to do those things that recharge you. Whether it’s exercise, meditation, hiking, prayer, golf, live music or time with family, don’t allow yourself to push these things aside and just grind through. Ignoring yourself will only make stress worse.

The current economic and financial morass will pass. How you respond to it will determine not only your clients’ future success, but yours as well.

Scott Hanson is co-founder of Allworth Financial, formerly Hanson McClain Advisors, a fee-based RIA with $15 billion in AUM.