Living in world with a 24/7 news industry whose mantra is "If it bleeds, it leads" poses challenges for us as financial professionals and as human beings.
How do you help your clients have confidence about their futures when they are watching, reading and listening to a steady stream of bad news peddled by smart, sophisticated communicators who are very savvy about getting people addicted to this bad news cocktail?
First of all, you must be totally committed to staying out of this morass yourself because you can't help them if you are just as vulnerable to the quagmire of negativity as they are. You must immunize yourself against the news media and some of the product promoters who would like you to believe that their gurus are smarter than their competitor's gurus.
Second, you have to be willing to tell your clients the truth. This truth comes in two forms:
1. The truth is that you don't know what's going to happen, that you don't believe that anybody knows what's going to happen, and that you don't spend any time worrying about things you can't control. Can they get on board with this truth? Can you get on board with this truth?
2. The truth is that the better game is to focus on what you can control and be prepared for the future. Peter Drucker famously said, "The best way to predict your future is to create it."
It's a bit like any kind of emergency preparedness. Have a plan. The plan won't stop unpredictable events from happening, but it does alter how you feel about them between now and when they do or could happen.
I live in Southern California. We have fires and earthquakes. We don't know exactly where or when they will occur, but we know that they will. Some Southern Californians are prepared. Some are not. Who do you think is more confident about the future? Confidence and preparation go hand in hand.
There's no point burning brain cells trying to predict what's going to happen or when. What if Greece or Spain or Italy goes bankrupt? What if Iran gets the bomb? What if the president gets re-elected or not re-elected? Instead, get prepared. And because the mind can only process a finite amount of information at one time, when it's busy preparing there isn't room for worry. In the mental space that used to be occupied by worry about the future is confidence.
What we are talking about here is leadership-leading your clients to a better way of thinking, believing and acting. It's better for them and better for you. The alternative is that you both are led by events out of your control and living reactive and stressful lives.
Preparing for the future is always right, while attempting to predict the future is, at best, a 50-50 proposition. This is an area where trusted advisors have a significant advantage over a typical wealth manager or investment advisor because they get people to focus on what they can control.