20 back-to-basics questions to gauge client optimism

Gauging investor sentiment can be tricky. Not all clients are forthcoming about their concerns while others may be an open book. A lot has changed in the last few years and your clients’ attitudes may be different than they were before a pandemic, global unrest, political upheaval and major economic shifts came on the scene.

Even advisors who feel they have a keen sense of where their clients stand could benefit from a fresh conversation. Consider getting back to basics by asking questions about the following topics, and get to know your clients all over again.

Topic: Inflation

Inflation tops the charts as the biggest concern for Americans, according to a Pew Research study. In fact, seven in 10 view inflation as a “very big problem” for the country. Their concerns about rising inflation far outweigh those on any other topic, including affordable health care (55%) and violent crime (54%).1 

Pessimism about rising costs and a potential recession may be top of mind for your clients, opening the door for the following questions.

  • How has inflation affected your ability to save each month?
  • Have you cut back on any spending due to inflation?
  • Have you had to borrow money to make ends meet?
  • Are you willing to make changes to your lifestyle to stay on track with your savings goals?

Topic: Market volatility

It’s no secret that markets have been anything but steady, and your clients might feel uneasy about their investments. Knowing how willing a client is to ride out the ups and downs can help you engage them in strategic conversations. Redefining a client’s tolerance for risk can also help inform which products or investments to recommend. For example, some types of annuities are linked to market indexes with the potential for double digit growth and a guaranteed floor, allowing clients to stay in the market with fewer potential risks. 

  • When markets drop, do you have a tendency to take a fight or flight approach?
  • What percent of loss in your portfolio would be extremely concerning to you over a year’s span?
  • Would you prefer to define how much you could lose if it meant you might limit how much you might gain?

Topic: Job markets

The employment rate for Americans has made a remarkable comeback since the mass layoffs during the height of the COVID-19 pandemic and has hovered around 3.5%.2 It’s important to walk through the implications — good or bad — of any unexpected or planned changes, ideally before they happen.

  • Do you feel secure in your job?
  • Do you plan on making any career changes in the next few years?
  • Are you taking full advantage of any employer-sponsored defined contribution plans, HSAs, etc.?
  • When do you want to retire from the workforce?

Topic: Social Security

Like clockwork, Social Security is in the headlines again as lawmakers debate its solvency and how to rein in federal spending. As it stands now, Social Security spending exceeds revenues, and the program’s trust fund could be exhausted by 2033 if measures aren’t taken.3 Uncertainty over whether Social Security will be there for your clients may be a major concern that needs to be addressed.

  • How confident are you that Social Security will be there for you when you retire?
  • Have you calculated your projected Social Security benefits?
  • Will you need your Social Security income immediately when you retire, or can you delay claiming benefits by living off savings or other investments?
  • What other sources of guaranteed income will you have?

RELATED: Is Your Client Facing a Retirement Income Crisis?

Topic: Retirement savings

According to the most recent Census data, about three in five Baby Boomers (58%) and Gen Xers (56%) have some type of retirement account, compared to just under half of Millennials (49.5%).4 

However, major disparities exist between various ethnic groups, with Hispanics (28.3%) being the least likely to have any retirement savings at all.4 There’s still plenty of room for improvement, providing ample opportunities for advisors to engage new and existing clientele in meaningful conversations.

  • What keeps you up at night?
  • What does retirement look like to you? travel, leisure, part-time work, volunteering, etc.)
  • Do you feel you’re on track to meet your retirement goals?
  • If not, what changes are you willing to make to get on track?
  • What kind of legacy do you want to leave your family?

In the end, growing your relationships with your clients is more about listening than it is about asking all the right questions. Attentive listening is one of the best ways advisors can discover their clients’ outlook and motivations, their hopes and fears.

Go deeper with our Behavioral Finance Advice (BFATM) resources. They offer interactive exercises to help your clients move away from making erratic decisions based on shifting markets and emotions and, instead, make decisions based on their core values. Access these complimentary resources by clicking below.



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