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Advisor-in-Chief: Making the Most of Election Season

Fear has played a big role in this year’s presidential election, just as it traditionally has with investing.

During such a divisive and emotionally charged time, it’s important that financial advisors are on top of their game. Despite an apparent pattern that election-time markets tend to follow and widespread advice to ignore sensationalized headlines, investor uncertainty is a prevalent factor that financial advisors will have to address this fall.

Financial advisors should not only see this as an opportunity to open a dialogue with their clients, but as a chance to expand their practice, establish themselves as thought leaders and strengthen relationships. Much like the road to the White House, success won’t come from playing to investors’ fears, dodging tough questions or reciting the same canned statements.

Election season provides the perfect backdrop for engaging with existing clients, as well as capitalizing on the chance to acquire new ones.

Plan for Either Party

There is no shortage of ways for financial advisors to start important election-time conversations. Maintaining regular communication with clients and potential clients is critical, whether it’s through newsletter communication, automated direct campaigns, social media or simply picking up the phone.

The election season also offers the opportunity to host an event—a chance to connect with clients and prospects face-to-face. Instead of allowing investors to stew in fear, advisors can walk them through the different “what if” scenarios and demonstrate comprehensive plans for any outcome.

Advisors should also consider the recent lack of volatility when beginning these conversations with clients. Despite the Federal Reserve rate hike at the tail end of last year or the Brexit decision in Europe, this half of 2016 has been absent of big market swings. When things are going well with their portfolios, investors are less apt to making changes to their financial plan or hearing new financial advice. 

Talk the Talk

Investors will have questions as the election gets closer: How will either election outcome affect my financial plan? What kind of volatility should I be expecting? Are there any industries that will experience more volatility than others after election day?

In order to handle this influx of queries, it is important to be ready and well-researched. Advisors need to be prepared with talking points and educational presentations in order to educate existing clients about the ramifications their current portfolio could face. Prospective clients will also be seeking clarity and guidance in a tense political climate and are going to be looking for answers as well. They will want to know what risks they are already vulnerable to and how to minimize them. Advisors can’t rely on guesswork, though, and must do their due diligence when it comes to answering questions.

For example, influential factors such as headline effect can drastically impact the spending, saving and investing attitudes of clients and prospective clients. Staying up to date on current news stories and economic trends is vital to an advisor and will ensure that they are informed, educated and never blindsided by new information.

For clients that are in or planning for retirement, advisors can anticipate their questions and concerns by identifying any risks these clients may be facing come November. Most of these interests will be of a macroeconomic nature, including public policy changes to entitlement programs, tax rate changes, a shift in tax breaks at the hands of a new presidential administration or dramatic changes to health care. It’s also important to look past just investing—the winner of the election will likely also have an effect on clients’ overall financial plans.

Provide Tools for Success

Once the advice has been given and the votes have been cast, the election season also provides the perfect transitional period to adopt new technology and investing tools. According to 2014 polling data, only 40 percent of people think that American elections are fair to voters. Even if clients don’t feel in control of their political future, advisors can help them feel in control of their financial future, assisting them in navigating the unexpected bumps on the road to retirement.

A financial advisor’s job is to position themselves as the person who ensures their clients’ confidence in their retirement plan, regardless of short-term hiccups in the market. Utilizing the right technology and making it available as a client resource can be just as important as hiring the right advisory team.

By the time that changes in the market actually begin to show themselves, advisors who spend this pre-election period establishing themselves as well-informed and building client trust will have little to worry about. Unlike politicians, shaking hands and kissing babies won’t appease an advisor’s constituency during an election year. The best course of action is to understand the outcomes, prepare for all of them, educate clients about what to expect and guide them through any upcoming tension.

Otherwise, they may elect to find a new financial advisor to go with their new president.


Mark Mersman is the Chief Marketing Officer at USA Financial, as well as one of the co-hosts of the nationally syndicated USA Financial Radio Show. 


Investment Advisor Representative of USA Financial Securities. Member FINRA/SIPC. A Registered Investment Advisory firm located at 6020 E. Fulton St., Ada, MI 49301

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