Don't Get Left Out in the Cold: Helping Clients Prepare for the Worst

Bill McManus   |  Wed Feb 10 10:30:00 EST 2016

Man in snow

A couple of weeks ago, we in the Northeast were buried under about two feet of snow and were left digging ourselves out from what was one of the worst blizzards in recent memory. Records were broken, travel was impaired (to say the least), and several of our nation’s largest cities essentially shut down.

Luckily, we were prepared. Leading up to the storm meteorologists agreed that the weather event would be large scale and could have significant impact on as many as 100 million people. In reaction to the predictions, those of us in the storm’s path armed ourselves with all of the snowstorm essentials: grocery store shelves were emptied; hardware stores sold out of shovels and rock salt; and beer, wine and liquor sales skyrocketed. We had enough warning, and so we were able to prepare for what ended up being a days-long weather event.

But what if we had not had advanced warning? What if the Blizzard of 2016 had caught us off guard? For those who rushed out pre-storm to buy essentials at the last minute, they could have been stuck without a shovel and no tools to protect themselves from being trapped by the unexpected chaos.

It led me to think about financial storms, and how we can apply these same principles to our finances. There are several lessons that can be gleaned from the Blizzard of 2016 that can apply to how we prepare and react to financial storms. Just like it is better to buy a snow shovel when there is no snow in sight, when it comes to our financial lives, being prepared for unpredicted, unforeseen events ahead of time can make a world of difference when the inevitable storm hits.

There are several ways that financial advisors can help their clients be prepared and armed for any potential financial storms that may hit:

1. Examine their portfolio construction.
Take a careful look at your clients’ portfolio makeup to make sure that they are positioned to weather market volatility. Do they have a balanced long-term approach to cushion their portfolio in down markets? Remind your clients that portfolio construction is not about making moves based on what is happening in the market right now, but rather about making arrangements to ride out the market’s unpredictable ups and downs.

2. Save it for a rainy (or snowy) day.
The same way that market volatility happens, so too does life have its ups and downs, all of which can affect our financial health and unearth unexpected financial burdens. No matter how well we prepare, the fact remains that events happen in our lives that are out of our control. However, we can control how well we anticipate such events and how to react to them. The trick, then, is to build a contingency plan into the mix. Talk to your clients about making sure they have sufficient assets to handle the unexpected.

3. Plan for the long term.
Although snowstorms are typically short, their impact can be long lasting, especially with regards to clearing the piles, safely getting around and being able to access the outside world. Very similar considerations can be applied to longevity—as we age and enter the retirement phase of life, things such as traveling, doing housework and accessing our social networks can become trickier. No matter your clients’ age, it is never too early to talk to them about their life in retirement and to help them become armed to tackle these kinds of issues and incorporate them into financial planning.

For now, the blizzard is over and much of the snow has melted, but one thing is for sure: that is not the last snowstorm we’ll endure. Buy your snow shovels and rock salt now, so that you have them in your back pocket for the time you do need them. And let that serve as a reminder for financial advisors to do the same for their clients—help them be better prepared from a financial standpoint for different scenarios and events, so that they do not get left out in the proverbial cold.

Bill McManus

Bill McManus  

CIMA®
Director, Strategic Markets


Bill is part of the Strategic Markets Team for Hartford Funds. In his current position, Bill is responsible for engaging and educating both financial advisors and their clients about current and emerging opportunities in the financial-services marketplace. These opportunities range from tactical strategies in areas such as retirement-income planning, investment planning, and charitable planning, to anticipating and preparing for long-term demographic and lifestyle changes.

Bill joined the organization in 2003 as an advisor consultant responsible for marketing Hartford Funds in Virginia and West Virginia. Bill earned his Certified Investment Management Analyst (CIMA®) designation, is FINRA Series 7 and 63 registered, and holds his life and variable insurance licenses.

Bill has been widely quoted in consumer and trade publications such as US News and World Report and Wealth Management.com. He has also appeared as a featured guest on Bloomberg Radio to discuss his views on retirement-related topics.

Originally from Smithville, New Jersey, Bill attended the University of Pennsylvania where he earned a bachelor’s degree in political science. He currently lives in Philadelphia, Pennsylvania.


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