3 Tactics for Framing the Conversation During Market Volatility
Help clients stay focused on their long-term plans during market volatility.
Questions This Article Can Help You Answer:
- What steps can clients take to keep their plans for retirement intact during market volatility?
- How can I help reassure clients who are concerned by news headlines about market volatility?
- What can I show clients about their past experiences that could help them reframe their current financial goals?
With a 24-hour news cycle and constant updates on market performance, clients may be tempted to react emotionally to market volatility instead of sticking to their long-term plans for retirement. Consider these tactics to promote productive conversations that could help clients stay focused on their goals during uncertain financial times.
1. Review and Reassess Financial Goals
When clients call concerned about a disruption in the markets, use the opportunity to:
- Suggest a one-on-one meeting to go over their financial strategy, review where they are currently, and discuss where they want to be with both short- and long-term goals
- Introduce new products and investment strategies that can help meet their changing needs or objectives
2. Help Clients Understand Historical Market Performance
When signs of volatility appear in daily headlines, encourage clients to avoid responding with a rash or hasty decision. Instead, discuss how the current performance may be affecting their portfolio in the short term and what their feelings are about the volatility. Provide clients with historical examples of stock market performance over both the short and long term to help them better understand that markets typically have both higher and lower performance averages. For example, the pandemic hit the stock market hard, with the S&P 500® Index declining more than 30% between February and March of 2020. But by August of that same year, it had reached its pre-pandemic level and continued to rise steadily throughout the rest of 2020 and 2021.1
3. Review Each Client’s Risk Tolerance
After an initial meeting, a client may feel that their risk tolerance or goals from the past have evolved. Re-opening this conversation can help you realign their investment strategy to better match their current goals.
Changes in the market are a given, but it doesn’t have to derail long-term plans. Market disruptions can be an excellent opportunity to connect with clients, review their financial goals, and even introduce new products that could be appropriate for their needs.
1 S&P 500 Index. Google Finance, as of November 2023.
Past Performance does not guarantee future results.
This information is brought to you courtesy of Brighthouse Financial, Inc., which provides, through its affiliates, annuities and life insurance products issued by Brighthouse Life Insurance Company, Charlotte, NC 28277 and, in New York only, by Brighthouse Life Insurance Company of NY, New York, NY 10017 (“Brighthouse Financial”).