No matter the background, profession, or wealth status of your clients, they could feel as if all sides of their finances are being targeted by the cost of living crisis.
Indeed, a study by the British Association for Counselling and Psychology (BACP) found that two-thirds (66%) of therapists say the cost of living crisis is causing a decline in clients’ mental health.
Their investments may have experienced a downturn, while rising costs could have thrown their monthly outgoings – such as mortgage repayments, day-to-day expenditure, and energy bills – into disarray.
Plus, it seems as if we are not out of the woods yet. With the base rate being hiked to 3% in November, and inflation reaching a 41-year high in October 2022, clients might feel overwhelmed by their prospective costs in the coming months.
If clients are turning to you with financial anxiety at this time, it’s your job to support them through it as best you can.
Read on to find out five ways you can soothe clients’ financial stress and build relationships in the process.
1. Learn to spot the tell-tale signs of financial stress
Firstly, it is important to note that your clients might not be crystal clear about the fact they are suffering with financial anxiety. As an adviser, you may have to read between the lines.
Some tell-tale signs of financial stress in clients could be:
- Asking for additional portfolio reviews, on top of those you already provide
- Throwing open-ended “what if?” questions your way on a regular basis
- Obsessing over the negatives instead of looking at the whole picture
- Suddenly wanting to cash in investments, or radically change their financial plan
- Expressing immediate interest in withdrawing their pension early
- Shortness, rudeness, or frustration in communications.
When clients exhibit these signs, they could be losing sleep over the cost of living crisis.
As their adviser, it might be time to gently ask about their wellbeing, and create space for a conversation about financial worry.
2. Improve your firm’s approachability
Although it may not seem obvious, the cost of living crisis is providing your firm with an opportunity to double down on your approachability.
As you know, marketing matters. Now, when clients are stressed and looking for someone to turn to, firming up your client journey could make all the difference for them.
Things to focus on could include:
- Regularly posting insights on LinkedIn and other social media platforms
- Including clear calls to action on all the content you produce
- Improving the user experience (UX) of your website
- Showcasing client testimonials as often as you can.
Not only can this approachable stance bring new clients into the fold, but it can also extend a hand to existing clients, helping you deepen your relationship with them when they need it most.
3. Consider yourself a “guide”, not just a “clinician”
If you’ve been in the advice business for many years now, you may have maintained a traditionally “clinical” approach to financial advice.
Your clients present you with their fiscal goals and you assess them, performing “surgery” on their financial plan to help them get there.
Although there is nothing wrong with this approach, it should be the foundation of your relationship with clients, not the whole package. Especially during the cost of living crisis, your clinical analysis of a client’s wealth is not enough to soothe their worries.
Indeed, building your “soft skills” – empathy, emotional intelligence, and adapting your approach based on the client’s demeanour – can instil confidence in even the most anxious clients.
Building your soft skills into your practice, which still relies on the foundational “hard skills” of your expertise and qualifications, can be invaluable when dealing with stressed clients who need a confidant in trying times.
4. Turn the cost of living crisis into a building block for client relationships
There are few positives to be gleaned from the cost of living crisis, but one potential upshot is the opportunity to build stronger relationships with your clients.
If you are experiencing an uptick in engagement from clients who usually only check in quarterly or annually, you could take the opportunity to get to know each client more personally.
Listen to their goals, dreams, and deepest concerns, and you’ll better understand how to provide an unbeatable service to them and their loved ones.
For example, research published by Professional Adviser reports that the cost of living crisis is now the “main driver for intergenerational financial planning”. 76% of households are still planning for the financial wellbeing of other generations, despite rising costs making this more difficult.
So, as an adviser, now could be the time to deepen your reach within clients’ families, and adapt your service to work with, not against, the cost of living crisis.
5. Seek support from your network
Ultimately, you are only human. While taking on the financial anxieties of your clients, you could find yourself becoming overwhelmed, too.
Indeed, a survey published in October 2022 by Professional Adviser found that only 25% of advisers are confident their clients would meet their retirement goals – down from 34% in March 2022.
If you feel concerned about your clients’ wellbeing – and about your ability to support them – joining a network can help.
Here at Corbel Partners, we work with IFAs who want to strengthen their own practice, thereby providing an even better service to clients when they are met with financial challenges.
Within our network, you can benefit from:
- Compliance support from industry-leading experts
- One-to-one and group training that can help you pass exams and improve soft skills
- Paraplanning support, so you can focus on building client relationships
- Administrative assistance to help keep your practice organised and on track.
Don’t take on the cost of living crisis in silence. We’re here to help.
Get in touch
To join our network and receive unparalleled insights on helping clients through the cost of living crisis, email email@example.com or call 01925 637891.