Survey sheds light on clients' concerns as well as perception of financial advice's value amid volatility
As clients’ stress levels rise in the face of multiple financial stressors, CFP professionals are telling them to avoid making emotional decisions amid market volatility.
In a new survey of professionals conducted by the CFP Board, more than one in three CFP professionals (36%) reported that their top advice to clients is to wait out the volatility before making any major financial moves. Another 17% said their main advice was to rebalance portfolios, and 16% prioritized a review of short- and long-term goals.
“The spread of COVID-19 is having a resounding impact on all aspects of our lives," said Kevin R. Keller, CEO of CFP Board.
Almost two thirds (64%) indicated high or very high stress levels among their clients. When asked to name clients’ top concerns, almost three fourths cited concerns around managing volatility (74%) and protecting assets (72%); just over a third identified liquidity (35%) and unemployment or reduced income (34%) as primary stressors, while nearly three tenths (29%) said clients worried about saving enough for retirement.
Choppy financial markets and economic malaise threaten clients’ financial futures, but CFP charterholders believe there’s still hope. The vast majority of respondents (94%) agreed that Americans with a financial plan are more likely to make progress toward their financial goals.
In line with that, nearly two thirds predicted that more Americans will seek financial advice in the aftermath of the COVID-19 crisis. Almost eight tenths (78%) said they’ve witnessed a higher volume of inquiries as the coronavirus pandemic evolved, and just over a third (34%) said that more prospective clients have been approaching them with inquiries.
With rising appreciation for financial advice, survey respondents said that they now face a twofold challenge: maintaining more frequent communications with clients (18%) and catering to their emotional needs by acting as therapists as well as financial planners (17%).
“The findings show that during the current health and economic crisis, CFP® professionals play an important role in counseling Americans through stress and uncertainty,” Keller said.
