Most people view financial advisers as investment managers whose job is primarily to select investments and ensure their clients get a certain level of returns. However, the role of a financial adviser goes far beyond this conventional notion.
These days, the value that financial adviser delivers to their clients should ideally be a balanced mix of technical and soft skills, especially during times of high market volatility.
In this post, we talk about the evolving roles of financial advisers and the skills they need to benefit their clients beyond providing investment advice.
Evolving roles – counsellor, financial expert and client advocate in one
With changing client needs that are increasingly becoming more complex over time, a financial adviser can take on various tasks.
As counsellors, they can act as advisers who’ll help handle the emotional strain of making tough financial decisions and their potential consequences.
In certain instances, an adviser may be regarded as a technical financial expert of sorts or guru, providing their own perspective or analysis and acting as the voice of reason. When necessary, a financial adviser might also serve as an advocate defending or acting on behalf of their client and their interests.
While explaining such intangible value advisers provide can be challenging, the benefits of having one are evident when clients feel more assured or secure. In turn, clients are better able to deal with the unpredictability of the market. They also have the confidence of knowing that everything is under control and that they have an expert they can depend on when things get tough.
Preventing costly emotional blunders
Investors who forsake a strong investing plan because of emotion or fear typically lock in losses and miss out on the eventual rally after periods of turbulence.
Therefore, financial advisers must have distinct expertise in gaining a client’s trust and offering sufficient reassurance. This way, clients will keep to their long-term financial plan, avoid getting emotional when the market is in turmoil and steer clear of costly behavioural blunders brought on by frustration and despair.
With a lot of Australians facing financial stress at some point in their lives, emotional support during difficult times is an important aspect of the financial adviser value offer. In fact, it’s not unusual for clients to seek advice from financial experts in times of tragedy, illness, death and financial difficulty.
Therefore, special skills such as behavioural coaching and giving emotional support can prove to be more valuable to a client than simply asset allocation. This is especially true when it comes to regulating the behaviour and emotions of a client, particularly when there’s turbulence and uncertainty in the market.
If you need expert financial advice, seek the help of a seasoned adviser with the right technical and soft skills to help you navigate market highs and lows successfully.
If this article has inspired you to think about your own unique situation and, more importantly, what you and your family are going through right now, please contact your advice professional.
This information does not take into account the objectives, financial situation or needs of any person.
Before making a decision, you should consider whether it is appropriate in light of your particular objectives, financial situation or needs.