Tighten Your Focus, Broaden Your Perspective

During the BBC documentary Seven Worlds, One Planet, there is footage of an albatross parent that is forced to leave the nest momentarily to find food for its chick. While it’s gone, the chick is blown out of the nest, where the parent left it, by gale-force winds. The chick’s survival is at risk, due to the weather conditions and decreased shelter, but for another more unexpected reason: albatross parents identify their chick by location, not sight or sound.

When the parent albatross returns to the nest, with food in its crop for the chick, and finds the nest empty, it seems to fixate on the absence of the chick from the nest. Despite the chick being mere inches away, struggling to get back into the nest: the parent’s laser-focus on “chick not being in the nest” constructs the very tunnel-vision that puts the chick at real risk of death.

There’s a parallel in this for how we navigate the distress invoked by market disruption: focus on the growth of our goals remains important, but if we develop tunnel-vision on the current economic snapshot, we risk behaviors that will, ironically, starve out our success. If, instead, we can feed our focus but zoom out to have broader perspective, we insulate against the danger of impulsive action that betrays our best interest. Let’s look at how we can do this:

Empathy Before Strategy

Periods of market turbulence can be terrifying for any investor, and the fears are valid but can’t drive decision-making. The uncertainty of what happens next can instigate anything from paralysis to reactionary insistence we have to do something. This bias to take action leaves us liable to impulsive decision-making that actually risks returns in the long-run. It’s natural for investors to feel panic in an episode of volatility: without an advisor, 76% of investors indicate struggle to have peace of mind in managing their investment. That drops to 20% for investors that have financial advisors³: advisors make the difference between the clients that react reflexively to this fear, rather than reflecting and acting in accordance with long-term goals. Why is this, and how can we be part of that subset? Same reason investors prefer human advisors to tech-only solutions: the ability to empathetically steer investors towards their goals, even when waters are choppy.

It’s essential to resist the urge to immediately jump into problem-solving mode or soothing the client with promises of future returns during times of market volatility. Instead, start by empathizing with your clients’ fears. It can feel counterintuitive to engage with an investor’s panic, but rather than amplify it, empathetic exploration of investors’ experience engenders a sense of partnership and understanding necessary for investors to become calmer and constructive. Proactively reach out to investors,  normalize the fear and anxiety that often accompany market downturns, and create conditions that let clients feel heard and understood. By starting with empathy and validation, you’ll be better equipped to guide them through the downturn with a sense of trust and clarity.

In due course of empathizing and validating these fears, acknowledge explicitly that uncertainty is inherently stressful and a reaction of distress is natural. Reassure them that while the future may be unpredictable, you are committed to staying agile and pivoting as necessary to help them stay focused on their long-term financial goals. This pairing of acknowledgement and support has been shown key, in helping people align behavior with best-outcome in uncertain conditions: Physicians often help patients work through uncertainty around prognosis, and studies have demonstrated that pairing acknowledgement of uncertainty with reassurance and faith for their patient in staying the course, leads to best outcome, strengthening the client’s resolve and enhances their ability to weather challenges.

Reiterate to your clients that you are partners in this journey, navigating the ups and downs together. This might include steps, such as:

• Acknowledging their portfolio may not be where it has been in the past
• Restating that distress around that can be natural
• Contextualizing the distress in terms of their wider goals:
  • Assess if they are still on track towards their financial goals in terms of behavioral consistency with things such as contributions or spending
  • Reviewing which behaviors are consistent with key objectives such as growth, diversification, and long-term stability

From this position, we’re ready to shift into strategizing.
 

Strategize with Support

We can only control a limited number of factors, and it’s essential to focus on those. While it’s natural to worry about things we can’t control, that worry is of low utility. Acknowledge those concerns, express that you wish the situation were different, and work together to identify which aspects of their financial plan you can influence and which you cannot. Focusing on what we can control brings a host of well-documents psychological benefits and improves ability to regulate emotions that might otherwise prompt high-risk-low-return behaviors.⁶ By doing this, you reaffirm your role as a steady guide, helping clients focus on what matters most and providing clarity during uncertain times.

As you focus on the things within investors’ control, be sure to fully explore all the options they do have:  market downturns threaten our sense of control over our lives and futures, and exploring all the options – including ones we may not want to take – can reinstate a sense of confidence for investors, that even if tides are beyond their control, they understand the topography and are as informed as possible when they chart their course. Being able to explore options serves to help investors feel less like they are cornered, which supports acting from a place of knowledge, not fear, which will buffer clients against reacting to uncertainty by doubling-down on following forecasts or the predictions afforded by partial knowledge, which are about as useful as a coin-flip.⁷

Provide psychoeducation around this feature of our neurological functioning: uncertainty can trigger strong psychological and cognitive responses, often activating a fight-or-flight reflex that makes people want to jump into action. Neurologically, this is a natural reaction, as our brains are wired to seek control in situations that feel threatening or unpredictable. This heightened state of alertness may drive people to make impulsive decisions, like trying to predict market movements or chasing short-term forecasts. However, it's crucial to recognize that these reactions are driven by fear, which is a normal response to uncertainty. Instead of succumbing to the instinct to act immediately, it’s important to pause and reflect on the best course of action based on what we actually know. By engaging in thoughtful reflection and resisting the urge to react impulsively, we can make decisions grounded in strategy rather than emotion, ensuring that actions align with long-term goals rather than short-term anxiety. This approach helps to create a sense of calm and control, even in the face of uncertainty.

If, at any point during this process, investor distress is re-elevated, it’s crucial to pause the strategizing and return to empathy and understanding. Take a moment to listen actively, normalize their feelings, and reassure them that their concerns are valid. Failing to do this can leave investors feeling misunderstood and unheard, which increases the likelihood of them reacting impulsively and seeking short-term solutions as a defense. By taking the time to empathize and validate their emotions, you create a safe space for thoughtful, long-term decision-making.

Treat uncertainty as a teacher, a chance to reflect on what truly matters and where you can take action. Start by asking yourself and your clients: What are you most afraid of losing in this uncertain environment? Once you identify those fears, focus on what can be done to protect them, and recognize what’s within your control. This is where you refocus on the importance of goal orientation, not a control orientation. The goal isn’t to control every variable, but to stay grounded in the non-negotiable elements of the plan — security at the base level, and flexibility in areas where your client has choices that can boost their confidence. From there, adopt an RBI (responsive, not reactive) mindset: rather than making hasty decisions based on panic, you can be thoughtful and strategic in your response. Finally, revisit why you structured the plan the way you did in the first place. Often, simply reviewing the original strategy helps reaffirm its strength and clarifies how to stay on course in a volatile market.

The focus here should be on coaching your clients toward the best decision-making process, rather than fixating on outcomes that, by nature, cannot be guaranteed. True value comes from providing services and guidance that ensure long-term success, regardless of the market’s immediate performance. What’s needed today is a strong partnership with your client as you navigate through this uncertainty. Think of yourself as the steady hand on the wheel of the ship—holding firm and maintaining the course even when the waters get choppy. If you react impulsively by changing direction in response to short-term fluctuations, it’s unlikely to simply misalign you with your long-term goals. Instead, staying focused on the bigger picture and guiding your clients with consistency and patience will ultimately help them reach their financial destination.