By its nature, financial planning takes the long view - and so do financial planners. A good plan, and a good planner, should not be completely derailed by market swings or uncertainty in the regulatory environment; instead, they adapt, often using strategies and tools prepared in advance.

Financial planning clients, on the other hand, are not always so calm in unsteady times.

Challenge and response

When we asked this year's Wealth Magnets to name the most important issues facing financial planners, the maj­ority named volatile markets and uncertain regulation in a variety of areas, from tax and health care laws to the question of fiduciary responsibility.

"Navigating issues associated with turbulent markets and their impacts on clients' long-term financial goals," as Indianapolis-based Crowe Wealth Management put it, is certainly a major challenge facing the profession, as is the undetermined future of estate tax laws.

In many cases, though, planners are already prepared to deal with this kind of uncertainty. Their planning processes, investment offerings, asset allocation models, and scenario-building capabilities are designed to adapt in the face of real-world changes. Cincinnati-based TruePoint, for instance, reported that it is "rebuilding all financial plans under multiple scenarios (increased tax rates, surtaxes, increased medical costs, conservative real returns) to allow the client to understand their financial security under many different assumptions."

This kind of forward-thinking, proactive planning also characterizes the approach of SS&G Wealth Management, in Akron, Ohio: "We help our clients prepare a detailed budget and search for ways to lower expenses. We also perform an insurance needs analysis to identify any potential risk that could derail an otherwise sound plan. Finally, we then recommend investments designed to generate income that they cannot outlive."

With such tools and plans in place, the real issue for many firms is not how they themselves react to uncertainty, but how their clients do: "Keeping clients focused on the journey toward a comfortable retirement and not allowing them to be distracted by the day-to-day ups and downs of the markets" is critical, according to Houston's Hollis Huff Lewis Financial Services.

The need to maintain client discipline in sticking with a financial plan, an asset allocation strategy, or even a personal budget in the face of fears and anxieties has led many of our Wealth Magnets to put a greater emphasis on client communication. "We need to try, as best we can, to redirect our clients' attention away from CNBC, Mad Money and the reckless amount of short-term focus that the media constantly hypes," TruePoint wrote.

In the interests of "keeping our clients from making irrational and emotional decisions that will cause years of potential damage," Denver-based GHP Investment Advisors is taking client outreach very seriously: "In addition to quarterly newsletters and financial statements, we are having our clients come in or engage in a telephone conversation at least three times a year."

CPAWealthProviderAUM2010Ranking.pdf

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