Helping Clients Cope with Fear
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The document discusses how financial advisors can help clients cope with fear, anxiety, and stress related to their finances. It describes the physiological responses of fear, anxiety, and stress and how they impact client behaviors. When fearful, clients tend to have a short-term mindset, avoid risks, and make poor financial decisions. The document provides strategies advisors can use to help regulate client emotions, reframe negative thoughts, and conduct experiments to build confidence. It also addresses challenges advisors may face in dealing with client emotions and market volatility.
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Helping Clients Cope with Fear
- 1. Helping Clients Cope with Fear NAPFA February 29, 2016 @docgresh http://www.slideshare.net/docgresh/helping-clients- cope-with-fear Atlanta Financial Psychology Mary Gresham, Ph.D.
- 2. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 3. Fear, Anxiety, Stress • Fear: Immediate threat Atlanta Financial Psychology Mary Gresham, Ph.D.
- 4. Fear, Anxiety, Stress • Fear: Immediate threat response • Anxiety: Generalized experience, uncertain or negative future Atlanta Financial Psychology Mary Gresham, Ph.D.
- 5. Fear, Anxiety, Stress • Fear: Immediate threat response • Anxiety: Generalized experience, uncertain or negative future • Stress: Physiological response Atlanta Financial Psychology Mary Gresham, Ph.D.
- 6. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 7. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 8. Fear Neutral Atlanta Financial Psychology Mary Gresham, Ph.D.
- 9. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 10. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 12. APA Stress In America Atlanta Financial Psychology Mary Gresham, Ph.D.
- 13. In the last year Atlanta Financial Psychology Mary Gresham, Ph.D.
- 14. money Atlanta Financial Psychology Mary Gresham, Ph.D.
- 15. The importance of money
- 16. Social exclusion Atlanta Financial Psychology Mary Gresham, Ph.D.
- 17. Physical pain Atlanta Financial Psychology Mary Gresham, Ph.D.
- 18. Atlanta Financial Psychology Atlanta Financial Psychology The Money Taboo
- 19. What does this mean for financial advisers? Atlanta Financial Psychology Mary Gresham, Ph.D.
- 20. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 21. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 22. Dr. Gregory Berns Atlanta Financial Psychology Mary Gresham, Ph.D.
- 23. When clients are fearful • Short-term time frame Atlanta Financial Psychology Mary Gresham, Ph.D.
- 24. When clients are fearful • Short-term time frame • Risk averse Atlanta Financial Psychology Mary Gresham, Ph.D.
- 25. When clients are fearful • Short-term time frame • Risk averse • Underspend, overspend or overpay Atlanta Financial Psychology Mary Gresham, Ph.D.
- 26. When clients are fearful • Short-term time frame • Risk averse • Underspend, overspend or overpay • Purchase the wrong products Atlanta Financial Psychology Mary Gresham, Ph.D.
- 27. When clients are fearful • Short-term time frame • Risk averse • Underspend, overspend or overpay • Purchase the wrong products • Avoid important tasks Atlanta Financial Psychology Mary Gresham, Ph.D.
- 28. When clients are fearful • Short-term time frame • Risk averse • Underspend, overspend or overpay • Purchase the wrong products • Avoid important tasks • Don’t make changes Atlanta Financial Psychology Mary Gresham, Ph.D.
- 29. When clients are fearful • Short-term time frame • Risk averse • Underspend, overspend or overpay • Purchase the wrong products • Avoid important tasks • Don’t make changes • Obsess over decisions or act on impulse Atlanta Financial Psychology Mary Gresham, Ph.D.
- 30. Rational approach Atlanta Financial Psychology Mary Gresham, Ph.D.
- 31. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 33. Emotional Regulation Atlanta Financial Psychology Mary Gresham, Ph.D.
- 36. Storytelling Atlanta Financial Psychology Mary Gresham, Ph.D.
- 38. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 39. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 40. Reframing Atlanta Financial Psychology Mary Gresham, Ph.D.
- 41. Identify Other Assets Atlanta Financial Psychology Mary Gresham, Ph.D.
- 42. Self-Disclosure • I don’t know if this is helpful but when I have felt this way, I have __________ Atlanta Financial Psychology Mary Gresham, Ph.D.
- 43. Experiments • Clients will do things as an experiment that they will not do as a “change” Atlanta Financial Psychology Mary Gresham, Ph.D.
- 44. Experiments • Clients will do things as an experiment that they will not do as a “change” • Increases a sense of control Atlanta Financial Psychology Mary Gresham, Ph.D.
- 45. Experiments • Clients will do things as an experiment that they will no do as a “change” • Increases a sense of control • Increases self-observation Atlanta Financial Psychology Mary Gresham, Ph.D.
- 46. Experiments • Clients will do things as an experiment that they will no do as a “change” • Increases a sense of control • Increases self-observation • Experiential learning Atlanta Financial Psychology Mary Gresham, Ph.D.
- 47. Experiments • Clients will do things as an experiment that they will no do as a “change” • Increases a sense of control • Increases self-observation • Experiential learning • Get information about the outcome Atlanta Financial Psychology Mary Gresham, Ph.D.
- 48. Financial experiments • Listen to music instead of news Atlanta Financial Psychology Mary Gresham, Ph.D.
- 49. Financial experiments • Listen to music instead of news • Check pictures of grandchildren instead of portfolio Atlanta Financial Psychology Mary Gresham, Ph.D.
- 50. Financial experiments • Listen to music instead of news • Check pictures of grandchildren instead of portfolio • Give away some money Atlanta Financial Psychology Mary Gresham, Ph.D.
- 51. Financial experiments • Listen to music instead of news • Check pictures of grandchildren instead of portfolio • Give away some money • Open a paper trading account and do there what you are proposing to do Atlanta Financial Psychology Mary Gresham, Ph.D.
- 52. Financial experiments • Listen to music instead of news • Check pictures of grandchildren instead of portfolio • Give away some money • Open a paper trading account and do there what you are proposing to do • Pick a time to deliberately worry about money for 15 minutes daily and/or leave your worry here in my office. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 53. Ounce of prevention • Initial meeting: prior negative experiences with money? Atlanta Financial Psychology Mary Gresham, Ph.D.
- 54. Ounce of prevention • Initial meeting: prior negative experiences with money? • How are you likely to respond if……. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 55. Ounce of prevention • Initial meeting: prior negative experiences with money? • How are you likely to respond if……. • What will you need then? Atlanta Financial Psychology Mary Gresham, Ph.D.
- 56. Ounce of prevention • Initial meeting: prior negative experiences with money? • How are you likely to respond if……. • What will you need then? • Let’s write it down Atlanta Financial Psychology Mary Gresham, Ph.D.
- 57. Adviser challenges • Own fear, anxiety and stress Atlanta Financial Psychology Mary Gresham, Ph.D.
- 58. Adviser challenges • Own fear, anxiety and stress • Impatience with extra effort required Atlanta Financial Psychology Mary Gresham, Ph.D.
- 59. Adviser challenges • Own fear, anxiety and stress • Impatience with extra effort required • Market factors affect all clients at the same time Atlanta Financial Psychology Mary Gresham, Ph.D.
- 60. Adviser challenges • Own fear, anxiety and stress • Impatience with extra effort required • Market factors affect all clients at same time • Lack of training in dealing with client emotions Atlanta Financial Psychology Mary Gresham, Ph.D.
- 61. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 62. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 63. Thank you Atlanta Financial Psychology Mary Gresham, Ph.D.
- 64. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 65. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 66. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 67. Atlanta Financial Psychology Mary Gresham, Ph.D.
- 68. Atlanta Financial Psychology Mary Gresham, Ph.D.
Editor's Notes
- This is your brain on fear…fMRI results when shown a picture of fearful faces; other ways to induce fear for studies is to have subjects anticipate electric shock or cold pain, use recollections and imagery; play loud noises including sounds of people screaming; and to increase the amount of carbon dioxide in the blood so that subjects gasp for oxygen….and money loss..
- Gregory Berns of Emory has also used money losses and shown that subjects responded to money loss similarly to electric shock. Subjects had higher body response to shock but rated money loss as subjectively equal to shock.
- Anxiety has to do with our uncertain future, or anticipating a negative future event.
- Over a lifetime an average US citizen has a 28% chance of having characteristics of anxiety disorder. This is the largest category in the US…peaks during years from 30-44.
- The series of experiments in social psychology that have been done in the lab are called “money priming” experiments and Subtle hints of money are introduced, for example using a screensaver with dollars floating vs a screensaver with fish floating. People are largely unaware of the impact of money hints on their behavior. Researcher Kathleen Vohs found that people respond to money primes by preferring to work alone, not asking for help, offering less help to others, working harder at impossible tasks, feeling less physical discomfort and feeling less social discomfort when excluded. The conclusion is that money increases a feeling of self-sufficiency and reduces engagement with others.
- Counting money reduced the reaction of the brain to social exclusion.
- Counting money reduced the physical pain of immersing hand in 122 degree water
- the avoidance of meaningful, contained discourse about money
- Clients will be bringing their fears, anxieties and stress to YOU…
- By now you have heard the metaphor of the brain as consisting of a crocodile bottom layer, an elephant midbrain and scientist riding on the back of an elephant, trying to control it. So your job, then is to become the elephant whisperer for the midbrains of some of your clients.
- When clients feel listened to, accepted and understood they begin to calm; they then need to have emotional labels and make sense of their emotions. Emotions are accepted and understood to be of value.
- Focus on body sensation; as client describes and focuses, they become more aware and in the present.
- Metaphors, imagery and expressive language are useful in making an emotional connection. Some clients do not want to directly identify emotions and use of metaphor is easier for them. Metaphors also shift perspective and allow clients to do things differently.
- Story telling can be a powerful way to communicate without raising resistance.
- Mindfulness and mediation practices assist clients with emotional regulation
- Challenge, opportunity, life experience that will be valuable
- Goals is to have client slow down and self-calm. Acting out feelings is not helpful, move to responsivity and not reactivity.