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Times of Market Volatility Require Advisors to Shift Their Mindsets

April 2, 2020 Steve Zuschin By Steve Zuschin

In recent weeks, advisors have faced something they haven’t seen in a decade: a volatile market that ultimately resulted in a significant correction and the end of the long-term bull market. This current volatility is based on uncertainties around the impact of the COVID-19 global pandemic, as well as an oil price war. To pile on, we are all transitioning to remote working environments and adjusting to meetings that aren’t in person. These circumstances would amplify any advisors’ insecurities and fears that their business will suffer.

Admittedly, a market downturn is an uncomfortable discussion to have. No one wants to highlight losses with their clients. After all, performance is often seen as the main tangible measurement of the advisor-investor relationship. However, there is something positive advisors can do in this environment…

First, take a minute to reassess the situation.

Shift your perspective from scarcity to abundance

Now make a mental shift from scarcity—the losses and the lack of control—to abundance—the silver lining that includes things that can be controlled. This mindset shift will lead to productive conversations that focus on the value and benefits advisors can bring to their clients beyond performance.

Advisors can also help their clients find more opportunities for tax-efficiency in their plans. The LifeYield Taxficient Score® helps advisors show clients they are paying unnecessary taxes. It gives them a single Score they can use to communicate the value of a tax-smart portfolio. In light of our current circumstances, the Score can help guide advisors through positive conversations.

The Taxficient Score is also a measurable tool that advisors can use to demonstrate their value to clients, regardless of the investment climate. We believe that taxes are the single largest drag on a portfolio, keeping investors from optimal outcomes. While we cannot control performance, we can make improvements to these outcomes through tax-efficiency.

Have a mobile mindset

A second silver lining: advisors have the opportunity to approach the way they do business differently. Face-to-face meetings shouldn’t be a requirement. If you aren’t offering your clients a way to connect virtually (through tools like, Zoom, or Go-To-Meeting), now is a great time to add these options to your practice. This shouldn’t just be done as an emergency measure either, but for our long-term plan. People’s lives are busy, and as we get forced into this change, people are going to start to like the convenience of web conferences.

Advisors can also work on prospecting for new clients by showcasing their opinions, advice and expertise on their social channels. Given all the uncertainty in the market and with the pandemic, focus on providing insights that can help prospective and current clients. There’s a ton of misinformation flying around, so anything you can do as an expert to clarify complicated topics or guide investors to the solutions that are right for them will set you apart.

The average American spends over 52 minutes a day commuting to and from work. What if you used that time to focus on your digital footprint and produce content to share with your community and fine tune your social media presence? 

Create asset consolidation opportunities

Market volatility can cause DIY investors to seek financial advice. It can also cause those who currently have an advisor to question the value of the relationship. This quest inevitably leads them to the internet, where they’ll find all that killer content you started producing instead of sitting in your car!

Advisors can also pick up new business in down markets by offering differentiated, positive-thinking solutions to clients. When you can direct the conversation towards positive topics that you can control, you can use the optimism to encourage clients to consolidate their accounts with you. After all, tax efficiency is dependent on coordinating all the accounts in the household to work together, we see this as win-win.

Overall, it’s time for all advisors to shift their mindset. A shift away from solely focusing on performance toward the abundant ways they provide holistic value to clients. When advisors approach client conversations with the right tools, they can have the proactive conversations that clients deserve.

Steve is the EVP of Advisor Success at LifeYield. He's responsible for leading our Direct-to-Advisor channel and always keeps up on the latest advisor technology. Steve writes about how advisors can grow their business by building stronger relationships with clients and adopting new technology.