Action items: The long view isn't just for clients

Beverly Flaxington & Mike Slemmer

1 July 2008

To be truly reassuring, an advisor has to feel and act assured about things. Beverly Flaxington and Mike Slemmer are principals of The Collaborative, a Medfield, Mass.-based business consultancy to financial-service firms and software companies.

Working with advisors every day, we know immediately -- even if we haven't checked CNBC -- whether it's an up or down day. We see the tension, the anxiety and the urgent desire to "fix" things in response to a volatile market's latest peregrination.

Managing portfolios and watching markets are big parts of the advisor's offering to clients. But the advisor is also there to help clients understand how to "take the long view." Trouble is, we do that even as we tend to take every market blip and gyration |image1|sorely to heart.

What does "taking the long view" mean anyway?

Education, communication

As the industry slowly but surely moves from a reliance on pure asset management to the offering of overall wealth management, the need for wealth-management service providers to walk the talk. Wealth management is a process of looking at the whole picture, of considering the entirety of the investor's life -- and of staying "cool" whether the market is hot or not.

Having a process and a methodology for planning and for continuing to educate clients about the long view is vital. Whether it's creating a "program" for introducing your clients to the long-term perspective, or providing seminars to reinforce this view, or aligning with other professionals such as attorneys and accountants to create a holistic plan, you must show the clients that it's the overall picture that really counts.

If you haven't taken an overall view of managing the client's "life and wealth," there are many training programs, software programs and approaches available.

Of course clients worry when the market doesn't behave. And having a system in place for sharing your perspective on market moves with clients is important. Not communicating with clients in times like these, or just saying, "Hey, we take a long view, so we don't worry about it," won't reassure a client who is losing money by the minute.

What makes sense is a process that looks at the whole client, the whole picture and the long term, combined with demonstrable, day-to-day concern for the client's feeling and experiences.

And remember: that even if you are making good decisions, letting the clients understand how the process works is critical to your success. -FWR

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