Professional financial planners can add real value, both financially and non-financially. 

As well as providing reassurance and peace of mind during uncertain times, advice can help your clients avoid common pitfalls and mistakes, whether with their savings, pensions or investments.

Schroders’ recent Pulse Survey, quoted by Money Marketing, looked at the conversations clients and planners are having. It found that the cost of living crisis dominates, with worries about the risk and reward of cash savings and investments cropping up for 90% of advisers. 

Around 89% of surveyed clients are looking to alter their plans in the face of rising living costs.

Here are just a few areas where Boolers’ advice can add value and help your clients achieve their long-term goals.

1. Encouraging investment and managing risk and reward

The survey found that 90% of planners have had to weigh up cash v investments and explain the benefits of each. 

During periods of market volatility, this is understandable. Your clients might become more risk-averse, but re-examining their attitude in the context of high inflation and soaring interest rates is key.

While holding some savings in easily accessible cash accounts is vital for protecting your clients and their families should the unexpected strike, high inflation quickly erodes the real-terms value of those savings. 

At Boolers, we can make sure your clients understand their risk profile and capacity for loss, helping them to invest toward their long-term goals in a way that works for them. 

Cashflow modelling can be a particularly useful tool to forecast – and illustrate – the likely outcome of the decisions clients make. 

With inflation falling more slowly than expected and the Bank of England’s (BoE) base rate likely to rise higher in the coming months, a risk-managed investment aligned to a long-term goal is likely to be the best plan to add value in the long run.

2. Staying calm and managing a measured decumulation

As we have already seen, sticking to investment strategies during times of volatility can be difficult. Falling markets often trigger emotional knee-jerk reactions but the long-term consequences of leaving the market during economic downturns can be huge.

Not being invested when markets recover effectively means turning a paper loss into a real one and that could seriously hamper your client’s progress. 

Around 89% of clients admit to changing their plans thanks to the cost of living crisis, mainly due to higher household bills or to help family members. 

Clients need to be encouraged to remember their long-term aspirations and to ignore the noise of short-term volatility. Boolers can add significant value here.

Even for clients that have already reached their goals, advice can add value. The decumulation phase of retirement has been made harder to manage by Pension Freedoms legislation, putting the onus on clients to manage their retirement income. This becomes even trickier during tough economic periods.

Withdrawing more than planned – whether to pay bills or help dependants – could mean that a retirement fund runs out too early. Likewise, making drawdown withdrawals when markets are low means selling more units. This too can diminish a fund more quickly than clients anticipate and lead to a shortfall in later life.

Advice throughout the accumulation and decumulation phases is key to managing a pension that will last a lifetime.

3. Regular reviews help clients adapt to changing priorities

Sticking to a long-term investment plan during periods of stock market volatility is vital if your clients are to reach their goals. Regular reviews can help to make sure that happens.

But that doesn’t mean that clients’ plans aren’t allowed to change.

Life events like births, deaths, and marriages can change priorities and mean that alterations are necessary. It is here that a robust plan with in-built flexibility adds real value.

We can help your clients manage a household budget following a new arrival, adjust their level of savings and investments as their income changes, or help them to manage their estate planning after a marriage or divorce.

Generally, your clients should stick to their long-term plans but knowing when to make changes is important too. When alterations are made, we can offer reassurance and peace of mind that the decisions they make are the right ones for them.

Get in touch

If you have clients who would benefit from help with any of the topics raised in this blog – from household budgeting to debt management and financial protection – please get in touch. Email or call 0116 240 7070.

Please note

The value of investments (and any income from them) can go down as well as up and investors may not get back the full amount they invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with an investor’s overall attitude to risk and financial circumstances.