When the market takes a sharp plunge, the real test of a financial advisor during market volatility is simple: do they reach out, or do they go silent?
The stock market often feels like a massive rollercoaster. When it’s climbing, the ride is thrilling and effortless. But when it takes a sudden, sharp plunge, it can push regular investors into full-blown panic. It is during these volatile drops that the true value of a financial professional is tested. Are advisors doing enough to keep their clients calm, or are they falling short when the pressure is on?
A revealing report by J.D. Power Wealth Intelligence examined investor sentiment during periods of significant market turbulence, specifically tracking reactions following major tariff announcements and subsequent market pullbacks. The findings offer a stark wake-up call for the financial services industry, showcasing a significant disconnect between what clients need and the support they actually receive.
The Reality Of Market Anxiety
According to the data, a whopping 56% of investors surveyed stated that the market downturn represented the toughest investment climate they had ever experienced. Let that sink in. Despite navigating massive historical cycles like the 2008 financial crisis and the COVID-19 market crash, over half of investors felt the recent turbulence was the most challenging environment yet. This underscores how deeply short-lived financial memory can be; human emotion responds heavily to the immediate pressure of the present moment.
Nearly Half Of Managed Investors Felt Unsupported
Because of this intense pressure, many individuals felt left completely in the dark. The report revealed that 31% of managed investors felt entirely uncertain and unsupported by their advisors during the downturn. An additional 7% expressed frustration over receiving absolutely no guidance, while 10% remained unsure of where they stood. In total, nearly half of all managed investors experienced some level of doubt or frustration regarding the communication coming from their chosen financial professional.
The Silence Is Deafening
To be fair, most advisors do try to put out fires. The data shows that 57% utilized low-touch communication methods (like emails, texts, or letters), and 56% engaged in high-touch outreach (such as phone calls, video chats, or face-to-face meetings). However, despite these efforts, 18% of investors reported receiving zero contact from their advisor during the peak of the market shock.
What A Financial Advisor During Market Volatility Should Do
Imagine watching your life savings or retirement portfolio take a dive, only to experience total radio silence from the professional you pay to manage it. Market shocks are the ultimate “moment of truth” for investment professionals. It is the absolute test of whether an advisor can manage human emotion and fear, or if they simply blend into the background when things get tough.
The Shift Toward Professional Guidance
This volatility has radically shifted the perspective of Do-It-Yourself (DIY) investors. Managing a portfolio is simple when the markets are green, but when everything turns red, it becomes an entirely different beast. The J.D. Power report revealed that 40% of self-directed investors are now likely to hire a professional financial advisor within the next 12 months.
Younger Investors Want Expert Backup
This desire for professional backup was most pronounced among younger generations, with over half of Millennials and Gen Z self-directed investors indicating they need expert help to shield them from emotional decision-making.
What This Means For You
- If you have an advisor: If you felt ignored or stressed during the last market dip, remember that you have every right to expect proactive communication. Initiate an honest conversation with your advisor about their strategy and ask directly: “What is your plan to support me the next time the market drops?” A great advisor doesn’t just build a portfolio; they serve as a steady, rational voice when emotions take over.
- If you are a DIY investor: Feeling overwhelmed by market swings is completely natural; millions share your anxiety. Focus on what you can control, such as your savings rate, and ensure your risk tolerance and asset allocations are updated regularly during market upturns, rather than making panicked changes when the market is already down.
Money is emotional. Make sure you get the guidance that fits for you.
Disclaimer: Investment advice offered through Integrated Financial Partners, doing business as One Vision Retirement, a registered investment advisor. The information in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. Integrated Financial Partners does not provide legal/tax advice or services. Please consult a qualified legal/tax advisor regarding your specific situation.
About the Author:
Lisa Sakai is a Financial Consultant who works with clients on Bucket List Acceleration and getting to live the life they want now. As the co-founder of One Vision Retirement, she has been working with clients across the country for over 12 years. Lisa’s advice provides easy to understand, logical steps and exercises that people can take action on right away. Learn more about Lisa Sakai here at One Vision Retirement.
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