Latest news with #financialadvising
Yahoo
30-07-2025
- Business
- Yahoo
Maintaining Client Relationships During Off-Hours
Surf's up … right after this client call. Whether it's summer vacation, spring break, or even just the weekend, everyone needs time off, and in wealth management, that can lead to conflicts since clients increasingly expect that they should be able to reach their advisor at a moment's notice. With a little bit of planning and boundary-setting, however, advisors and clients can come to a middle ground where no one's water-skiing lesson is interrupted to discuss market moves. READ ALSO: New Stablecoin Bills Are Normalizing Crypto for Advisors and AI Set to Play More of a Role in Investment Selection Ring, Ring Technology helps. Whether it's through emails, phone calls, video chats, or in-person meetings, clients have more ways to access their advisors today than ever before. And that access is key for long-term relationships: Nearly 90% of client reviews about advisors focus on relationship quality and emotional factors, while just 10% focus on investments and portfolio management, according to a recent study from Wealthtender, a platform that helps people find advisors. The report also found that one of the top priorities for clients is having advisors who are easy to reach and responsive to questions. Real-time access to an advisor is common at family offices. 'Those are the people who are like, 'I need the answer yesterday,'' said Chad Maggard, managing director of family office services at Johnson Investment Counsel. His solution? A second-chair advisor who maintains the office while he's away. 'He's a rising star and can respond to our clients just as well as I can,' Maggard told Advisor Upside. That always-available mindset is showing up in smaller, traditional firms too, sometimes at a cost. 'I actually left my job where this was an underlying expectation,' said Omen Quelvog, founder of Formynder Wealth Management. Now solo, he sets clear availability guidelines upfront, which he said clients appreciate. 'While I love being an advisor and I love my clients, I also love my time on holidays,' he told Advisor Upside. Gotta Do What You Gotta Do. Even with boundaries and other colleagues in place, surprises happen. 'I was in Spain when a client called about a market dip and a cash-raise for unexpected expenses,' said Dennis Huergo, an advisor at Wealth Enhancement. 'I stepped away from a wine-tasting to talk them through it and loop in my team stateside. That's just part of the job sometimes.' This post first appeared on The Daily Upside. To receive financial advisor news, market insights, and practice management essentials, subscribe to our free Advisor Upside newsletter.
Forbes
07-07-2025
- Business
- Forbes
Why Advisors Should Start With Behavioral Finance During Planning
Gianluca Sidoti is an Independent Financial Advisor, Founder of TraDetector and Managing Partner at The Wealth Company International. Imagine walking into a doctor's office, and instead of asking about your symptoms, the doctor hands you a generic prescription that 'works for most people.' You'd be concerned—and rightfully so. Yet this is exactly what happens every day in the world of finance. Investors are handed prepackaged solutions without anyone considering their behavioral profile, biases, emotional responses or decision-making patterns. As an independent financial advisor who has worked with hundreds of clients across Europe and the Middle East, I can say with certainty: Behavioral finance is the missing foundation in most investment plans. The Human Side Of Money Traditional finance assumes that people are rational agents optimizing expected returns. But anyone who's watched investors panic-sell during a market drop knows this isn't reality. People invest with emotion, not spreadsheets. Over the years, I've encountered investors with wildly different reactions to the same market event. One client, a retired doctor in Milan, saw the Covid crash in 2020 as a golden buying opportunity. Another, a young engineer in Dubai, liquidated his entire portfolio at the bottom. Same market, opposite behavior. The Cost Of Ignoring Behavioral Factors Too many investors lose money not because their investments are bad, but because their behavior sabotages them. They panic during volatility and overestimate their ability to time the market. According to Dalbar's research, the average investor underperforms the market by a significant margin primarily due to emotional decisions. I once worked with an investor who was fixated on checking his portfolio daily. He became obsessed with short-term losses, even in a long-term retirement plan. We worked together to restructure his dashboard to show only quarterly performance, and we agreed on a 'no-login' rule during market turbulence. His results improved, because his behavior changed, not the portfolio itself. Financial Plans Fail Without Emotional Fit Even technically sound investment strategies can fail when they are emotionally unsustainable. A portfolio that's optimized for return but leaves you awake at night is, in my view, a failed portfolio. This is where behavioral profiling becomes essential for advisors. At our firm, we run clients through simulations that test their reactions to hypothetical drawdowns, unexpected expenses or even peer pressure. One tool we use is a 'Loss Aversion Challenge,' where investors are asked how they'd react if their 100,000 euro portfolio dropped by 20,000 euros in two weeks. Their gut response reveals more than any multiple-choice form ever could. Biases: The Unseen Enemy Every investor carries cognitive biases: overconfidence, anchoring, loss aversion, confirmation bias—you name it. And they have real-world consequences. Take, for instance, one client, an entrepreneur in his 40s, who refused to sell a losing stock because 'it would recover.' He was anchored to the purchase price. Eventually, the stock became worthless. Once we worked through the psychological barrier and reframed the concept of 'loss,' he became far more decisive and rational in his portfolio rebalancing. Another investor, a retiree, only invested in companies he recognized from the news. This familiarity bias led to a concentrated, unbalanced portfolio. Through education and exposure to evidence-based strategies, he diversified and reduced his risk—while maintaining emotional comfort. Behavior-First Planning For advisors who want to switch to behavior-first investment planning, here's how it can work in practice: 1. Start with client self-awareness. Use tools rooted in behavioral finance to help clients understand their emotional triggers and financial personality. 2. Incorporate investor emotions into goal alignment. Instead of asking 'How much do you want to save?' ask your clients, 'How do you want to feel when you retire?' or 'What scares you most about investing?' 3. Stress-test through scenarios. Model adverse situations—market crashes, job loss, inflation spikes—to evaluate how clients would react, not just how their portfolio would perform. 4. Provide ongoing coaching. Behavioral change doesn't happen overnight. That's why it's so important to schedule regular check-ins, not just for rebalancing portfolios but for rebalancing mindsets. The Advisor's Role In The Age Of AI With the rise of robo-advisors and AI tools, many ask if human financial advisors will become obsolete. I believe the opposite. Technology can execute trades, optimize allocations and automate savings. But it cannot coach behavior. It can't listen to a client's fear during a crisis or help them navigate a life transition. My vision of the future is hybrid: AI for efficiency, human advisors for empathy. Final Thoughts Behavioral finance should not be an afterthought or a side topic. It should be the starting point of every financial plan. Without understanding human behavior, the best strategy on paper can become a disaster in practice. Investing is not just a numbers game. It's a game of emotions, discipline and decisions made under uncertainty. As advisors, our job is to guide clients not only toward better portfolios—but toward better behaviors. That's how real wealth is built: with a plan that understands the person behind the money. The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation. 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