An informal survey of advisors in recent months uncovered the obvious—many firms had their best year ever.
And yet advisors say when one talks to clients, or people they meet in their daily lives, another argument emerges. Which year was worse, 2020 or 2021? In one online poll I saw, 2020 received about 64% of the 50,000 or so votes, while 2021 got 36%.
Obviously, people are responding to their overall emotional well-being, not their financial health, which actually has improved for many people. So the challenge for financial advisors in 2022 may well be to create ways for clients to convert higher levels of wealth into things that give them satisfaction and meaning.
It now seems increasingly likely that people around the world are going to have to learn to live with Covid and perhaps future pandemics, even as the draconian changes in lifestyle fade into the rearview mirror. One of several reasons for the sagging popularity of governments around the world was that many created expectations that vaccines would expunge this virus the way they once did with polio.
Public health professionals and governments alike failed to anticipate the delta and omicron variants. While everyone hopes omicron spells the beginning of the end to Covid-19, and it may, that’s not a wise bet. And it’s a stupid expectation to raise.
For advisors, the challenge is expanding deeper into areas of life planning. Clients who are parents of high school and elementary school children are wrestling with ways to mitigate the huge disruptions the children have seen in their formative years, years they will never get back.
Older clients may be dealing with depression. Many middle age clients find themselves rethinking their careers, while worrying about melancholy parents and unmoored offspring. Advisors aren’t professional psychologists, but the opportunities to become involved in conversations about these problems is powerful. Depression is no longer taboo when over half the planet is afflicted by it.
Everyone is dealing with these issues, and advisors can help by sharing the experiences of both clients and allied professionals who are tackling universal problems. For advisors who want to learn more on these topics, I’d urge you to read Steve Gresham’s column on page 19 on the new bull market in advice and Jennifer Lea Reed’s article on page 30 on the problem of at-home drinking.
It’s time to translate the financial gains clients have enjoyed over the last decade into something more significant.
Email me at [email protected] with your opinion.