Advisers, clients butting heads over markets

Financial advisers are apparently struggling to persuade their clients to share their rosy outlook of the markets. A recent Russell Investments survey found that 59% of advisers are optimistic about the capital markets. But just 7% of those reps said their clients feel the same way. That difference in perspective is putting more pressure on financial advisers to move beyond asset management into more of a hand-holding and consulting mode. “It's clear that advisers have been struggling with a very jittery client base,” said Phill Rogerson, managing director in Russell's consulting-services group. “Advisers are having a really difficult time getting clients to engage in sensible advice.” When asked to select what clients see as the top three obstacles to reaching their financial goals, 78% of advisers chose slow economic growth, followed by market volatility (61%) and investor cynicism (43%). From their perspective, advisers said the biggest obstacles they see preventing clients from reaching their financial goals are underfunding of retirement accounts (60%), the federal budget deficit (54%) and slow economic growth (52%). “Over the last two and a half years, all clients have become a lot more work because the magnitude of this downturn has really eroded investor confidence,” Mr. Rogerson said. “Even though we have seen signs of a recovery, investor confidence has clearly not come back.”