Financial Services Training Enhances Practice Growth During Recessions

The past year has been one of the most difficult periods in our history, especially for the financial services industry.  Portfolio losses have been at a high and investor confidence has reached a new low.  It is an important time for financial advisors to regain investor confidence and further develop the skills that will set them apart in this tumultuous market environment.   Financial services training and financial services education can help to accomplish these objectives. This article outlines the benefits of further financial services education and training from the perspective of a financial advisor
 
Three Ways Financial Services Training Will Help Your Practice:

Client Communication
Client communication during periods of fear can result in the broker gaining more referrals or at least a client for life. People seek out leadership and direction-they want to believe. Reach out to investors when your peers are panicking (or hiding). Sit down with them and review the financial plan. Show them how markets recover, how long such recoveries may take and, of course, the upward bias of the stock market.

Bear Market Reality
During uncertain or bear markets, investors frequently change brokers or decide to become their own advisor. Investors become frustrated that their broker's recommendations have done little, or nothing, to reduce the losses now being experienced. With the proper approach, the advisor can show the client how risk can be reduced and losses minimized.

Stocks vs. Real Estate
The fact of the matter is that no other investment has done as well as stocks-not even real estate. Over the past 30 years, residential real estate has appreciated about 4-6% a year while stocks have averaged 11-13% over the same period. Sure, some real estate has done dramatically better than 4-6% a year, but there are also some stocks and mutual funds that have done even better than the best real estate (e.g., how many real estate investors double their money in one year or less-there are lots of stocks and mutual funds that have doubled in value in less than a year).

Remind your client that a stock represents an ownership interest in a company and how nice it would be to own part of Apple (that dominates portable music devices and cellular phones) or the local utility company (that keeps raising rates) or a health care provider (whose charges greatly exceed inflation). You can also show them that by incorporating MPT, parts of their portfolio will often go up when stocks are falling (e.g., quality bonds and metals).

Comprehensive financial services training will provide you with what you will need to create portfolios designed to weather financial storms. Training that will provide a course of action the client can easily comprehend and embrace. How do you expect to excel if your methodology is just like everyone else's-be a leader, not a follower.