Corralling clients to do what you want - and what's in their best interest - is easier said than done. That's why financial advisors need to act as behavioral coaches with investors to get them through some of those tough times. Vanguard Investment Strategy Group Principal Fran Kinniry writes On Wall Street that advisors need to teach clients that what's best sometimes is to do what's counterintuitive -- for example, buying when the market is down, or selling when it is up to return their portfolio to the desired asset allocation.
Do your clients come calling when they get a pay raise, unsure about what to do now with this new influx of cash? Sarah Chang of Betterment suggests recommending that clients invest that extra money instead of adding it to their spending budget. For example: "If you’re spending $4,000 a month and you get a raise to $5,000 a month, it’s an opportunity to save more without reducing your consumption. Instead of investing your entire raise, save half of it. So, if you get a $1,000-a-month raise, spend $500 and save $500."
John Hancock is acquiring New York Life’s retirement planning division, increasing the Boston company’s retirement assets by 60 percent to $135 billion. The purchase will expand John Hancock’s retirement services from startups and small businesses to labor unions and midsize to large companies, including the office supply chain Staples Inc. As part of the deal, New York Life will take on 60 percent of John Hancock’s life insurance policies that were written before 2000, freeing up some capital and helping John Hancock move away from life insurance into wealth management.