The coronavirus pandemic will test financial advisers as they guide clients through market volatility and business disruption.
Advisers should “overcommunicate” with clients to allay their fears in the current climate, said Kate Anderson, group executive advice services and solutions at Centrepoint Alliance.
“Advisers have an important role to play during this time to guide clients through important and possibly life-changing decisions about their investments, superannuation and pensions,” Ms Anderson said.
“We have seen markets tumble before but they will bounce back and that is an important message, particularly for those who are still accumulating. For clients who are transitioning to retirement, they are the ones who more than ever will need to speak to a professional about their income requirements.”
Advisers should now be testing their ability to work from home and put into place business continuity plans to ensure service isn’t disrupted at a critical time in financial markets.
“This is an opportune time to demonstrate to clients the value of advice and confirm your commitment to remain open for business, just in a different way,” Ms Anderson said.
Centrepoint has also implemented a range of measures to support advisers and their clients, including holding weekly briefings for advisers and providing regular updates on industry and market changes, as well as creating templates and tools to help advisers communicate with their clients during the period of disruption.
“As an industry, we need to be patient as the government and regulatory bodies work through the current challenges,” Ms Anderson said.
“A good licensee should be keeping advisers up to date with what’s happening and helping advisers to communicate with their clients in the most timely and effective way.”
Advisers should also be discussing relevant investment time horizons with their clients, says Miriam Herold, head of research at Centrepoint.
“There is no one-size-fits-all approach to dealing with the fear and loss aversion, which is likely to be triggered in some clients by recent market turmoil and the developing pandemic,” Ms Herold said.
“It is at times like these that advisers can really add value by helping a client to understand their individual time horizon and financial requirements.”
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