Some clients might delay investing for several reasons. As a financial advisor, it’s your duty to detect the source of their procrastination and give them a strong rationale explaining why they should begin investing at the earliest.
The main priority for majority of individuals is instant satisfaction. They will prefer to spend money on things that they want now instead of saving it for emergencies or beginning a new investment. In order to help clients overcome this kind of hesitation, financial experts must employ visualization methods. Ask them to think about the happiness they will obtain if they spend their retirement years as per their wishes or get their kids married without any financial difficulty. Emphasize on the fact that these goals can be easily achieved if they start saving instead of spending.
People have the notion that the future is far away and there is lots of time to begin saving. Therefore, they don’t think of investing soon. Advisors have to make them understand that this perception can have disastrous effects. An effective way is to give clients a reality check. For example, if your client is a couple with small children, make them realize that in few years they will need funds for their higher education. Will they be able to fulfil their kids’ aspirations? If they don’t plan their investments soon, they might end up in debt. When clients become aware of the seriousness of the situation, they will view things in a different way and accelerate investing.
Lastly, many individuals don’t take inflation into account when they plan their future. Make clients understand that while the cost of living might increase considerably over the years, their earnings won’t. The only smart solution is to build a realistic investment portfolio so that they can spend their retirement phase comfortably.